How long have you been affiliated with Johns Hopkins? First of all, thank you for the invitation to the conference, Hall. This is a great event, and I’m excited about participating in it. To answer your question, I joined the Johns Hopkins Medicine board of trustees in July 2010 and became chairman of the board of Johns Hopkins Medicine International in July 2011. It’s a honor to be a part of the leading academic healthcare brand in the world. We have a stellar team representing an amazing institution globally. How did get into the private equity world? At Harvard Business School, I was very fortunate to get to know a couple of professors who were willing to meet with me as a first-year MBA student. They took me under their wing and provided personal introductions to leading venture capital and private equity leaders, including many HBS graduates. This private equity industry has a lot of business school graduates from a very limited number of schools, so the network effect is really important. Ever since business school, I’ve enjoyed this industry immensely, and these initial contacts from the folks from Harvard Business School were instrumental, so I’m very grateful. You and your partners manage close to $1 billion. Where are you planning to take Camden Partners into the future as far as funding goes? As our assets under management grow, we anticipate gradually increasing our fund sizes with each subsequent fund. Serving as a steward of capital – our own capital and our investors’ capital – is a real honor. I’m very proud of the current portfolio, but perhaps most importantly, my partners and I have the opportunity to work with some of the country’s best CEOs. It is humbling to be able to work with these ladies and gentlemen, and we are pleased to be able to call them part of the Camden family. What is your investment strategy? How do you choose companies? Venture capital and private equity are very relationship-based businesses. Camden has raised many funds in the last 20 years, and we’re now backing folks whom we’ve backed before. We work with business builders with whom we have previous relationships, whether they’re the CEOs, the founders, co-investors or deal sourcers. My partners and I truly place a priority on people, people, people, and serial relationships are the key driver for what we do. The best entrepreneurs and executives – the people who have been in this business for multiple cycles – know how they want to build their next operating company and they know which trends are important and I think we likewise have a good sense for how industries evolve over time. There’s some trend recognition and predictive skills needed in our investing industry, but much of the success is attributable to people. You are doing well with Essence Group Holdings Corporation and PatientSafe Solutions in the portfolio. What made those relationships a success? Was it prior relationships? These are excellent examples of prior relationships with management team members. Then, when you combine the “people factor” with a focus on reimbursement trends, you have a winning formula. Regarding new reimbursement strategies, Essence is the leader in population health management, evidenced but it’s recent No. 1 KLAS ranking in population health services. Essence focuses on a trillion dollar market opportunity, and we are very pleased with the company’s positioning and progress. PatientSafe is a national leader in mobile clinical communications by leveraging its technology leadership in point-of-care (POC) medication management and barcode scanning. PatientSafe is benefiting from the very powerful change in healthcare regarding how clinicians are communicating across the enterprise amongst their fellow clinicians and making sure that they’re capturing the clinical and financial patient data at the point-of-care. We do pay a lot of attention to how people are paid in healthcare. We basically follow the money. Two of our panel topics are “new forms of payment” and “value-based healthcare.” What’s your take on those two trends? Are those real drivers for you? Very important. Hundreds of billions of dollars will be spent on value-based care within the next several years. This is only a fraction of the $3 trillion healthcare industry. Value-based contracts are an integral part of the future of American healthcare, but they come in a variety of flavors. There are pure capitated risks, contracts where the providers are completely on the hook for quality and cost. But there are also “toned-down” risk contracts where the providers are not exposed to both upside and downside risk. The concept of value-based contracts, i.e. population health management in general, is arguably the top trend in healthcare. Talk about what you look for in management teams in your space and what they need to have in order to get traction with you or any top class investment group. #1: character and integrity. #2: a real track record of success with institutional capital. In private equity, venture capital and growth equity, we’re investors in high-growth private companies, and we’re responsible to our limited partners for how we allocate capital. Backing previously-successful CEOs is very important to us. Regarding our investment strategy, we place a real premium on what we call technology-enabled service companies that possess hybrid business models that differentiate based on great customer service on the front end combined with proprietary technology on the back end that helps the business scale. This is a very powerful front end-back end combination. We invest in people with expertise in these kinds of businesses. These are not pure technology, “dot com” businesses but rather technology-enabled businesses in vertical industries like healthcare, education and business services. Our investments are also generally not pure service businesses. If we end up investing in a service business, we like to quickly figure out how we can inject technology into the business model to optimize returns. What technology drivers and trends are important to this area? #1 Point-of-care technologies that enable mobility. #2 Revenue cycle management (RCM) companies, i.e. companies that improve
