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Wednesday, June 24, 2009

Former Independence Blue Cross exec forms new private-equity firm

It’s not surprising that executives who once ran a health-care company called Leprechaun L.L.C. would pick an unusual name for their next venture.

But Blood, Sweat & Capital L.L.C.?

Daniel C. Lyons, one of the four partners in the new private-equity firm, said he wasn’t sure who actually came up with the whimsical name. It was the winner from a contest the partners held among their friends and associates.

Their business plan is more serious: funding new health-care services companies. Rather than backing the next diabetes drug, Blood, Sweat & Capital is looking to capitalize on opportunities that the national debate over health reform will spawn.

Lyons said he expects to back new ideas championed by the nurses, allied health professionals and doctors on the front lines of a health-care system often criticized for its inefficiency and cost.

“They see the pain in the health-care system,” he said.

Blood, Sweat & Capital is a virtual company, with Lyons, based in Wayne, its only tie to the Philadelphia area. He retired recently after 14 years as an executive at Independence Blue Cross.

Most recently, Lyons was president and CEO of Veridign Health Solutions, a for-profit subsidiary in Center City that provides “back-office” services to insurers and health plans offering Medicare Advantage insurance coverage.

Based in New York, David Bach, who is CEO of Blood, Sweat & Capital, founded Leprechaun, also focused on Medicare Advantage plans. The other partners - Patrick Aberle in Fort Worth, Texas, and Michael Duffy in the San Francisco area - worked at Leprechaun, which was bought by XLHealth, of Baltimore, in 2007.

Lyons said the partners will use their own capital, but would not say how much they have committed. They intend to invest in the seed-stage range, from $50,000 to $250,000.

Top Dragon

The team of students behind Stabiliz Orthopaedics won Drexel University’s 10th annual Baiada Incubator Competition earlier this month. The medical-device maker gets rent-free space in the campus business incubator for a year, $12,000 in seed capital, and $35,000 in in-kind support, such as legal advice and brand positioning.
Posted by Mike Armstrong @ 2:30 AM  Permalink | File Under: Financial Services | | Health-care Services | Post a comment
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About Mike Armstrong
Mike Armstrong, a business editor and writer for nearly two decades, is the Inquirer's business columnist and PhillyInc blog editor. Contact Mike via e-mail or at 215-854-2980
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