Advocate Aurora Health, which has dual headquarters in Milwaukee and Downers Grove, Illinois, is ready to make moves in the consumer health arena.
On Thursday, the 26-hospital system announced the launch of Advocate Aurora Enterprises, a subsidiary focused on making investments in health and wellness companies. The subsidiary led a Series C funding round of more than $25 million for Foodsmart, a personalized telenutrition provider.
The genesis of Advocate Aurora Enterprises is rooted in the health system’s mission of helping people live well, said Scott Powder, president of the subsidiary, in a phone call.
“That purpose implies that we will ultimately…be much more involved in treating all aspects of a person’s health,” Powder said. “Our core business is obviously great medical and clinical care, but there is a pretty large body of literature out there that [shows] a person’s overall health is…also heavily impacted by many other determinants, including access to things like healthy food and nutrition, their employment status, their housing security status.”
This meant that the health system had to start participating and investing in the larger ecosystem of consumer health. Advocate Aurora Enterprises was created to provide a corporate structure for those investment activities. The health system will also consider making larger transactions through the subsidiary, like acquisitions, Powder said.
Advocate Aurora Enterprises plans to invest in businesses in the following three categories:
Enabling aging seniors to thrive independently in their homes
Supporting parents in raising kids with less stress and greater confidence
Helping people to achieve their mind, body and nutrition goals
The subsidiary’s first investment was in Foodsmart because its services touch on all three categories, Powder said.
Foodsmart provides several services through its platform, including telenutrition meetings with registered dietitians, personalization of meal plans and grocery lists, and the ability to order food online.
Further, the platform provides price comparison capabilities, discounts and Supplemental Nutrition Assistance Program (SNAP) benefits with partners like Walmart, Amazon and local grocers through delivery service Instacart.
“Food is medicine and critical to our health, yet the act of feeding ourselves and our families can be stressful, complicated and expensive,” said Dr. Jason Langheier, CEO and founder of Foodsmart. “Foodsmart takes the guesswork out of food buying that is sustainably affordable and addresses specific health needs.”
Though the launch of the investment arm may signal an interest in a venture capital strategy to some, Powder said that is not the case.
“We are not a venture capital fund or a private equity fund,” he said. “We certainly have some aspects of what we do that look like that. [But] we’re not necessarily looking to invest $10 million today and exit at $100 million in five years. We’re looking for companies that we can, over the long term, partner with — not simply buy in today and sell later for a return on investment.”
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