Bangalore-based specialty home healthcare services company Medwell Ventures Pvt Ltd has raised $10 million (Rs 64 crore) in its Series A round investment from Fidelity Growth Partners India and Fidelity Biosciences. The two investment firms have picked up significant minority stake in the company, it said on Thursday.
Prem Pavoor from Fidelity Growth Partners India and Ketan Patel from Fidelity Biosciences have joined the company's board as part of the investment.
VCCircle had reported in December 2014 that Medwell is looking to raise $10 million.
Medwell was started by Vishal Bali, former group CEO Fortis Healthcare who currently doubles up as head of PE major TPG's Asian healthcare investments unit; Ferzaan Engineer (former CEO of Quintiles India) besides Lalit Pai and Himanshu Shah, co-founders of clinical research site solutions firm Cytespace.
It started its operations over one year ago and last year acquired Nightingales Home Health Services Pvt Ltd, an established player in the home healthcare business, to get a bigger foothold in the industry.
The Nightingales team comprises more than 300 medical and paramedic professionals consisting of doctors, nurses, physiotherapists, speech therapists and trained bedside paramedical caregivers specialising in chronic care disease management. Nightingales has been in the home health sector since 1996 in Bangalore.
Medwell has set up two branches in Bangalore and one in Hyderabad. It will launch its services in Mumbai next quarter.
Using fresh funds, the company will make significant investments in technology and expand to five more cities in South and West India in the next three years.
Bali, chairman of Medwell Ventures, said the company will invest $50 million in three-five years as it seeks to take its subscriber base to 500,000 families in 10 metro clusters. The company plans to raise an additional $25-30 million over the next three years to fuel its future expansion.
“In India, the category of specialty healthcare at home will mature in a couple of years and the sector is finding investor interest,” Bali said.
Fidelity Growth Partners India and Fidelity Biosciences are part of American financial services conglomerate Fidelity.
While Fidelity Growth Partners India has been an active growth equity stage investor in Indian companies having backed over 20 companies in the country to date. According to VCCEdge, the research platform of VCCircle, this is the first known investment in India by Fidelity Biosciences.
Boston-based Fidelity Biosciences invests in private biopharmaceutical, medical technology and healthcare IT and services companies through venture capital stage deals.
Prem Pavoor, managing director at Fidelity Growth Partners India, said, “We see tremendous potential for a clinically focused, world-class provider of chronic care healthcare services at home.”
BMR Advisors acted as the financial advisor and BMR Legal acted as legal advisor to Medwell for this transaction.
Indian home healthcare market is poised for strong growth, according to Bali who estimates the current market size to be $3.5-4 billion, of which the unorganised sector accounts for 90 per cent.
In 2013, US firm Bayada had picked 26 per cent stake in Chennai-based India Home Health Care. Another emerging player is Bangalore-based Portea, promoted by serial entrepreneurs K Ganesh and wife Meena Ganesh. It has backing of Accel Partners and Ventureast.