Private equity firm invests in MobileHelp
BOCA RATON, Fla.—Florida-based private equity firm Stonehenge Growth Equity Partners has invested an undisclosed amount in MobileHelp, a mobile PERS provider based here.
Stonehenge Growth Equity Partners, the private equity firm that invested in MobileHelp, specializes in growth-stage, tech-enabled companies, likes the recurring revenue business model, and typically invests between $1 million and $5 million, according to its website.
Unlike MobileHelp’s formal equity round in 2012, which raised $6 million in growth capital, this deal provides liquidity for some early MobileHelp investors, Robert Flippo, MobileHelp CEO, told Security Systems News.
Since 2008, the company has raised a total of $15 million in several funding rounds, and between 2011 and 2014, the PERS provider has a CAGR of 163 percent, according to Flippo.
The company’s RMR is now at a level that allows it to get most of its growth financing from traditional sources such as banks, Flippo said. But the company’s transition from a startup to growth-stage business has generated a spike in interest from the private equity side, and that, he said, bodes well for the PERS space and MobileHelp alike.
Also reassuring, for several reasons, is the company’s ability to finance growth from traditional bank debt. “Knowing that you have growth capital means you can be more aggressive in going out and getting new customers,” Flippo said. “Everybody in the electronic security industry knows it takes capital to get customers because of the creation costs associated with bringing them in.”
The financing allows the company to expand quicker than it could organically, Flippo said.
It also provides greater strategic flexibility.
“If you need to do a strategic acquisition for a technology or other component of our business, the capital is there to do that,” he said. “So that makes you much less constrained in how you formulate a strategy going forward.”
Stonehenge Growth Equity Partners, which spun off from Stonehenge Capital Company in 2013, was interested in MobileHelp during its initial equity funding round, but didn’t invest then because its own fund hadn’t closed, Flippo noted.
A request seeking an interview with SGEP was not immediately returned.
Since MobileHelp’s inception, Flippo said he’s seen the skepticism around mobile PERS largely erode. “I watched that perception change. When we first joined [the Medical Alert Monitoring Association] in 2010, what we were doing was thought of as nontraditional, and many thought it wasn’t going to have the adoption,” he said. “It’s switched from that very skeptical point of view to where people are asking, ‘How are we going to get a mobile PERS offering of our own to keep up with the way the industry’s trending?’”
Flippo believes the expansion of telehealth functionality in mobile PERS units will be the next major phase of development for the devices. It’s been a busy year on that front already for the Florida company. In January, MobileHelp introduced the Cellular DUO mPERS unit, a mobile device and in-home base station that can deliver app-based medication reminders and activity monitoring.
In April, MobileHelp was issued a patent—its ninth—titled “Human Health Monitoring Systems and Methods,” which is designed to support products that extend beyond basic emergency response to a “broader ecosystem for health monitoring,” the company said.