Reprinted from: the Phoenix Business Journal
WebPT LLC has received $1 million from Canal Partners LLC in an effort to help the company expand its business.
By Patrick O’Grady | Tuesday, December 14, 2010, 12:01am MST
The Phoenix-based company has developed an electronic medical records software system that allows physical therapists to record everything from appointments to information about patients.
The private equity funding comes from the Scottsdale-based group comprised of Jim Armstrong, the founder and chairman of JDA Software Group, and entrepreneur Todd Belfer.
Paul Winandy, CEO of WebPT, said the funding will help the company begin to market its product, which already has more than 5,000 physical therapists as customers. Despite its growth, WebPT has yet to tap the vast majority of the market.
“What the money really provides is allowing us to go out there and market at a really aggressive level,” he said.
WebPT has been tracking down funding for several months. It has presented at the Arizona Technology Investor Forum, which was formerly headed by Winandy, and last week at the Invest Southwest Capital Conference.
Armstrong said his company decided to invest because WebPT seems to have the ability to scale quickly. As a result of the investment, Armstrong will become a board member.
“We look at fast companies all day long and we don’t believe most of them can truly scale. WebPT has proven that they can. We believe WebPT has done everything right and shows enormous potential to be the market leader in their segment very, very quickly,” Armstrong said.
The company’s growth has been fueled by a push for electronic medical records. The company was founded two years ago by Brad and Heidi Jannenga. Brad Jannenga is the company’s chief technology officer, and Heidi is its chief operations officer as well as a licensed physical therapist.
One of the attractions of WebPT has been it has had positive cash flow since its third month. Most of the money will be used for marketing, but some will be reserved for software development to expand the business into different areas, Winandy said.
“It’s our expectation that we won’t have to raise money again,” he said.
The company has targeted a market where an estimated 80 percent of its potential clients are using paper records of some form. Electronic medical records will become the standard by 2014, giving the company a large target audience, officials said.