Confidential

Strategic, specialist
capital for early-stage
healthcare companies

$25m Fund I
Opportunity Overview
May 2024
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Disclaimer
This presentation does not constitute an offer of securities in any existing or to be formed fund or
issuer or a solicitation of an offer to purchase any such securities by any person. Offers of securities
will only be made by delivery of a Confidential Private Placement Memorandum and associated
subscription documentation.

The information in this presentation has been presented for informational purposes only and is only a
summary of certain of the anticipated terms of the proposed fund. The actual terms of an investment in
the proposed fund may be different from the terms set forth herein, and such differences may be
substantial. Although the information has been obtained from sources which the fund management
deems to be reliable, all of which is subject to change, no representation or warranty is made as to its
accuracy or completeness. In preparing this presentation, the fund management has relied upon and
assumed, without independent verification, the accuracy and completeness of all information available
from public sources or which was otherwise reviewed by it.

Nothing contained in this presentation is, or should be relied upon as, a promise or representation as
to the future. Any projections or forward-looking information contained in this presentation represent
only the current estimations of the fund management. There can be no assurance that the fund will
achieve its investment objectives. You will be asked to consult with your financial advisor concerning
the risk considerations, charges and expenses before you invest.

Discussions of any individual partner’s past performance and returns include only specific transactions
executed by the fund’s management, which are representative of the target transactions of the fund.
We further note that the foregoing results are not intended, and should not be construed, as
guarantees of future performance.

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OUR FIRM

A venture capital partnership catalyzing the

innovations that improve the health of our
healthcare system
We invest in solutions that enhance access, elevate patient and provider
experiences, and lower costs to ultimately improve healthcare outcomes

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OUR ADVANTAGE

Fund 1
Introduction
InnovateHealth Ventures (“IHV”) is
targeting a $25m Fund I to invest in ~20 Strategic
Seed stage (Pre-Seed to Early Series A)
healthcare companies, primarily focused
on software and tech-enabled services
with strong stakeholder alignment around Network
care and administration

We are targeting a 3-5x net return for our

limited partners

4 IHV will not invest in biotechnology, life sciences, or medical devices

that require de novo FDA regulatory approval
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OUR ADVANTAGE

EXPERIENCE
Deep expertise is in our DNA
We fuse years of experience across early-stage investing, health system and payor strategy, operations, finance, and
our strategic network, to be a preferred partner to healthcare founders and target exceptional returns for our limited
partners. Our combined network and experience makes us a differentiated healthcare investing platform and partner
in the healthcare ecosystem.

LEADERSHIP TRACK STRATEGIC ADVISORY STRATEGIC

RECORD PARTNERS NETWORK NETWORK
Experienced seed-stage All partners bring Collaboration with Our expertise and We leverage our
VC joining forces with seed-stage and deeply integrated access points are ecosystem of expansive
two well-connected healthcare investing partners that engage supplemented by healthcare relationships
healthcare domain experience across prior with healthcare senior payor and across investors, payors,
experts as co-GPs to funds, healthcare organizations, subject provider industry providers, service
increase conviction, startup SPVs, and 55+ matter experts, and leaders, experienced providers and other
right-to-win, and ability startup investments integrated services startup operators and stakeholders for
to add value enhancing our platform domain experts sourcing, diligence and
post-investment support

5

EXPERIENCE
Our History
Coming together
Sandalphon Capital was
founded in 2016 as a
generalist venture fund by
Jonathan Ellis, primarily
investing in pre-seed to
early series A B2B
software and tech-
enabled startups in the
Midwest and other
underserved markets
As venture capital
matures, top-tier founders
will be attracted to funds
specializing in their given
industry
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Seeing an emergent need for healthcare
innovation and relative gap of strategic,
specialist capital at the earliest of stages.
The result of this evolution is
Sandalphon has bolstered its team with
InnovateHealth Ventures (“IHV”),
healthcare domain experts who have prior
a highly differentiated healthcare
investment and operating expertise:
venture platform with a network
of advisors, industry, and
• Nevin (ex-Elevance Health) has been with
strategic partners to create a
Sandalphon for nearly 3 years, and brings
leading, vertically-focused
a strong health plan (“payor”) expertise
healthcare fund
and network
• Jami (President & CEO of HealthEco) has
spent her career partnering with
healthcare organizations, and after
several years of informally collaborating
with Sandalphon, is bringing her provider
relationships and expertise to the platform
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EXPERIENCE

Our General Partners

Balanced team
GENERALIST PERSPECTIVE PROVIDER PERSPECTIVE PAYOR PERSPECTIVE

Jonathan Ellis, MiF Jami Youmans, MHA Nevin Ramanujan, MBA

Managing Partner General Partner General Partner
Chicago, IL Denver, CO Chicago, IL

17+ years of institutional investing experience, 15+ years of healthcare provider strategy, 8+ years of payor corporate development
including eight years as an early-stage GP operations, and investment experience and principal investing experience

• Founder & General Partner of Sandalphon Capital
• Raised two prior early-stage venture funds, with upper
quartile performance across 50 portfolio companies,
and previously angel invested in 30 companies
• Experience across 12 startup boards
• 5X entrepreneur, startup operator, and board member
• Raised over $40M from healthcare strategics for SPV
investments
• Currently Founder, President & CEO of HealthEco; Chief
Operating Officer, Atalan
• Prior corporate development experience
at Elevance Health (NYSE: ELVH)
• Responsible for 10+ acquisitions and investments,
leading to the creation of Carelon, and expansion of
Elevance’s MA/CAID health plans

• Founder of midwest.tech/connect virtual summit
• Previously Senior Vice President at Macquarie, spent
10 years investing in private equity and debt in various
sectors throughout the economic cycle
• Co-Founder of Vantedge Ventures and VantEdge One
Group
• Began career as a hospital administrator, leading
departments at Trinity Health and BJC Healthcare
• Served as Managing Partner of the Tarrson Impact Fund
and built its Health Equity investment team
• Began career as a generalist investor at Chatham
Capital, a middle market credit fund

• Masters in Finance from INSEAD, and BSc(Hons) in • MHA from St. Louis University, and BS in Cell & • MBA from the University of Chicago Booth School of
International Management with American Business Molecular Biology, Chemistry from Missouri State Business, and a BBA from the
Studies University University of Washington

7
3 General
Partners 2 Prior Venture
Funds 4 Prior
SPVs $60M+ Prior
AUM 55+ Prior Startup
Investments
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EXPERIENCE

Track Record
Upper quartile performance across two funds

Sandalphon Ventures I Sandalphon Ventures II

InnovateHealth Ventures I is our Managing Strategy: Generalist

Strategy: Generalist
Partner and Sandalphon Capital’s third fund. Fund Size: $14m
Fund Size: $4.2m Proof of Concept
Over the last 8 years and 50+ investments, Raised: 2016-17
Raised: 2021-22
Jonathan has refined his approach to Deployed: 2021-22
Deployed: 2016-19
Weighted average life: 1.9 years
seed-stage investing, early-stage company Weighted average life: 5.9 years
Portfolio: 26 Pre-Seed, Seed and Series
support, and VC fund management, as a Portfolio: 24 Pre-Seed and Seed Companies
A Companies
solo GP.
4.4x MOIC 32% Gross Asset-level IRR 1.2x MOIC 12% Gross Asset-level IRR
This evolution into a specialist fund strategy 3.4x Net TVPI 23% Net Fund-level IRR 1.1x Net TVPI 7% Net Fund-level IRR
1.1x DPI (*pro forma) 0.0x DPI Still early in fund lifecycle
blends the strengths of that experience,
with the benefits of additional partners,
greater domain expertise, and tighter focus. Select Portfolio Companies Select Portfolio Companies

8
*Sandalphon Ventures I is not audited. Pro Forma Net numbers shown assuming comparable capital call schedule and 20% carried interest. Metrics as of 12/31/23
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EXPERIENCE

Our Diverse Experience

Select investment history
Company Deal Lead Type Notable Investors Description Latest Update

Jonathan Ellis CVS Health Ventures, Frist Cressey Ventures, Solving the behavioral health supply/demand
Merged in 2019 to become Array, and raised a
Seed Extension Health Velocity, HLM, Wells Fargo gap via a B2B virtual staffing model for mental
(formerly Sandalphon I $25 million Series C led by CVS in 2023
Regroup Therapy) Strategic Capital health providers

B2B integrated technology marketplace to Founded in 2022 in strategic collaboration with

Nevin
Jami Youmans Froedtert Health, TriCore Reference
Seed solve provider and patient access to high three health systems, and has raised $14
HealthEco SPV Laboratories, South County Health
quality laboratory and diagnostic services million in 2023 led by HealthEco

Nevin Ramanujan Since investment, pilot has been successfully

Currently raising a seed / notable investors - Solving for rural health access to behavioral
run, and is in discussions with their pilot health
(formerly Tarrson Pre-Seed 25M Health (collaboration of LifePoint Health health care via a physician distributed
system to expand to multiple locations in
Harmon Care) Impact Fund and Apollo Global Management) referral model
North Carolina

Streamlining prior authorizations (PA) using A new CMS rule, finalized in early 2024, has
Nevin Ramanujan Excelerate Health Ventures, Bread & Butter medical policy transparency and AI to provide positioned Itiliti as one of few vendors that can
Seed
Sandalphon II Ventures, Altitude Ventures (still Seed stage) an automated and regulatory compliant provide payors with a regulatory compliant PA
solution for payors solution, resulting in new strategic investment

Jami Youmans B2B technology platform for organizations that

Founded in 2020, raised $2 million from two
Seed VCU Health, Froedtert Health want to engage safely and transform their
HealthEco SPV health systems led by HealthEco
approach to community health

Sandalphon (lead), MATH Venture Partners,
Jonathan Ellis healthcare angels (probably shouldn't call out
Seed
Sandalphon II CEO of MATTER without his permission) (cash
flow positive, no follow-on round yet)
Since raising their seed in 2021, Metopio has
Data visualization tools to stratify health risks gained significant traction from public health
by geography agencies and Medicaid plans, growing revenue
from $600k to $2.5 million

Jami Youmans Outsourcing (cGMP) facility intended to bring Raised $10 million of Series D venture funding
University Hospitals, UNC Health, LCMC
Series C safety and quality to compounded medications, in June 20, 2023, putting the company’s
HealthEco SPV Health, Froedtert Health,
for hospitals and provider networks pre-money valuation at $155 million

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EXPERIENCE

Our Advisory Network

Strategic payor, provider, and operator relationships

Placeholder Placeholder Placeholder

Deeply engaged network

of senior healthcare Ryan Miller Nevin
executives leveraging
Raj Shrestha
their expertise in the
Cathy Eddy Eric Steager
payor and provider
landscape to identify
optimal investment
opportunities, ensure Roman Margolin Niclas Kohler

thorough due diligence,

and provide strategic
Lourdes Rivas
guidance to maximize Steve Schlegel

10 the growth and success

David Cohn Chan Basho Neil Hattangadi, M.D.
of portfolio companies
This is not a comprehensive list of all relationships held by IHV. The individuals
Priya Bathija
and organizations represented reflect a sample of key relationships.
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EXPERIENCE

Our Strategic Partner

Expansive domain expertise

Current HealthEco Network Strategic Value

HealthEco partners with the nation's
leading healthcare organizations
and plays a crucial role in building,
commercializing, and investing in
impactful businesses by convening
senior executives, identifying and
solving common problems, and
offering comprehensive analysis
and insights across all phases of the
portfolio company lifecycle
x x
x x
x x
Equivalent to fifth largest health system by
collective size and scale of immediate network
• Proprietary deal flow developed from inside
of healthcare organizations, leveraging key
stakeholders and assets to co-develop
business models and opportunities
• Venture Studio support for the build and
launch of strategically-aligned portfolio
companies
• Commercialization Accelerator to rapidly
scale portfolio companies across the market
• Derisking and Due Diligence to enhance
investment processes intelligence, and
support
• HealthEco provider-owned health plan
Strategic Workgroup:…

55 7,768 59,173
Hospitals Beds Employees
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EXPERIENCE

Our Strategic Network

Ecosystem of deep healthcare relationships Incubators &
Our network consists of senior executives, decision makers, end Accelerators
users, and other key stakeholders within healthcare organizations Payors

Network of regional / national payors

Investors

Service
Providers Providers

Network of GPOs, consulting, and talent

Network of health systems, IDNs, ACOs, firms with deep healthcare roots
and telehealth providers

12

This is not a comprehensive list of all relationships held by IHV. The

organizations represented reflect a sample of key relationships.
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OPPORTUNITY

BIG OPPORTUNITY SLIDE

Placeholder Nevin

Placeholder

Placeholder

Placeholder

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OPPORTUNITY

Opportunity
We have a pulse on the healthcare market
Our strategic access allows us to deeply understand problems in healthcare,
viability of solutions, and the priorities of payors and providers

OPPORTUNITY
PAYOR PROVIDER

$1T1 Improving efficiency

Wasted health
Leveraging technology to reduce More than 50% of health
redundant admin and ineffective
An average of 2% gross costs p.a
clinical spend systems are reporting
underwriting margins due to negative margins due to
Creating access
increasing medical expenses 100M2
Americans w/o
Emergence of new, proactive and challenges with care delivery
preventative care delivery models
and limited room to increase access to primary
for existing and underserved e.g., sicker populations,
care
populations
premiums provider shortages, and
503 Unlocking value
reimbursement pressures
Petabytes of AI enables new insights and
healthcare data solutions leveraging data collected
p.a. from within and around healthcare

Notes
1. JAMA – Waste in the US Health Care System (Oct 2019)
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2. National Association of Community Health Centers – Closing the primary care gap (Feb 2023)
3. World Economic Forum – 4 ways data is improving healthcare (Dec 2019)
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OPPORTUNITY

Focus Areas
Aligning to the needs of stakeholders

INVESTING IN SOLUTIONS THAT:

Healthcare requires an
innovative approach from INNOVATE CARE
payors and providers to to reduce the $600 billion of ineffective clinical
spending through collaborative, engaging, and
expand their capabilities equitable care models
and lower costs while
achieving clinically INNOVATE ADMIN
equivalent or better to reduce the $350 billion of administrative waste
outcomes and experiences through streamlining and connecting workflows
and stakeholders across the healthcare ecosystem

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OPPORTUNITY

Market Landscape
Venture-backable exits in healthcare
US Healthcare, particularly care managed from the perspective of health plans, providers, employers, etc., comprises approximately
17% of the US GDP or $4.5tn as of 2022. This number is expected to increase to $7tn+ by 2030, as per estimates from the Centers
of Medicare and Medicaid Services (CMS). This growth is largely due to inefficiencies in our current system and changing population
needs, and large exits can be had building startups to curtail this growth as evidenced by the below exits over the past 10 years.

Mental Health Primary Care (Concierge) Primary Care (Senior) Pharmacy There are over 1.1m
[Gap in market – physicians and 4.7m nurses
Access to Care $3.5bn $3.9bn $10.6bn $750m
verbiage to be added]
Acquisition by across 6,120 hospitals, 48k+
INNOVATE CARE

Acquisition by Acquisition by Acquisition by

UnitedHealth Group Amazon CVS Health Amazon outpatient clinics, and
Palliative Care Chronic Care Care Team Enabler Hospital at Home Kidney Care VBC Enabler numerous private practices,
Collaborative but still, 100m US citizens do
$445m $3.5bn $8.0bn $18.5bn $2.5bn TEV $3.5bn TEV
Care Acquisition by Acquisition by Acquisition by Acquisition by Valuation at last strategic Valuation at last fundraising
not have access to primary
Elevance Health UnitedHealth Group CVS Health Teladoc investment (2022) round (2023) care, and there will be a
Population Health Population Health EHR (Cancer) Systems Integration 100k+ physician shortage by
Data 2030
[Gap in market –
Not Disclosed $800m $1.9bn $800m
Interoperability Acquisition by Acquisition by Acquisition Acquisition by
verbiage to be added]
Elevance Health Walgreens (WBA) by Roche Best Buy
[Research TBD] Population Health EHR (Cancer) Systems Integration In US Healthcare, there are
INNOVATE ADMIN

Administrative [Gap in market – 5.4m administrative staff

[Exit Value] $800m $1.9bn $800m
Complexity Acquisition by [TBD] Acquisition by Acquisition Acquisition by
verbiage to be added] (2017), and typically twice as
Walgreens (WBA) by Roche Best Buy many admin staff as
Payment Integrity Population Health EHR (Cancer) providers in a hospital setting.
Fraud, Waste, Health systems see curtailing
$3.2bn $800m $1.9bn [Gap in market – verbiage to be added]
and Abuse Acquisition by Acquisition by Acquisition
admin costs as their number
16 UnitedHealth Group Walgreens (WBA) by Roche one priority
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OPPORTUNITY

Solution Areas of Interest

Key Examples
EXAMPLES
SOLUTION AREAS
FOCUS AREAS
POPULATIONS Virtual Care
STAKEHOLDERS Provider Staffing / Augmentation
Access to Care Patient / Member Engagement
Social Determinants of Health
Geography
Regional, Rural, Urban
Chronic Care Management
Case Management
Collaborative
Providers INNOVATE Care Hospital at Home
Insurance Type CARE Care Team Enablers / VBC
Commercial,
Medicare, Medicaid,
Student Health
Population Health
Data Systems Integration
Interoperability Data Transparency
Longitudinal Health Records
Demographic
Gender, Ethnicity, Race,
Sexual Orientation
Prior Authorization
Payors Administrative Denials Management
Complexity
EHR Documentation Management
Condition INNOVATE Clinician Burnout
Physical / Mental
Health, Chronic, ADMIN
Severity, Utilization
Payment Integrity
Fraud, Waste, and
Abuse Risk Adjustment
Quality Control / Management
17 Claims Adjudication
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OPPORTUNITY

Portfolio Company
InnovateHealth Ventures I LP
Warehouse Special Purpose Vehicle (SPV)

Innovate Care
Sourcing Referral from First Trust Capital Partners (lead investor)

Referral Sources Payor Network and Expertise Trusted Co-Investor Relationship

Specialty care is broken, with disparate What we liked CEO & Management Product Traction Customer Traction
information, profit-focused vs. quality driven,
and a frustrating inability to find a specialist
Building the Infrastructure that Healthcare Requires Now

Switchboard helps payors and providers

Switchboard combines multiple, highly critical information
identify and coordinate high-value specialty Strategic Input layers related to pricing and quality, alongside hybrid network
care, through a hybrid specialty network Conviction points
development that is not easily replicable, but needed for VBC
alongside a quality-driven referral platform
enabling values-based care (VBC) contracting Point Solution Fatigue Excessive Specialty Costs
Demonstrable
Pain Point Optum Closes Telehealth Agilon loses $95M in Adj.
InnovateHealth Ventures I LP has secured 5% Business / Walmart Health EBITDA due to accelerating

initial ownership and majority investor status Closes medical costs

via the Company’s Series Seed Preferred stock Advisory Support Commercial Access Graduation

Series A: Referrals to
Value add Former Health Plan CEO Medicare Payor Intros
Strategic Investors
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Initial portfolio company via warehouse SPV to be assigned to Exits: Connections with
InnovateHealth Ventures I LP at first close Former HCIT CSO Primary Care Intros
strategic acquirers
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OUR ADVANTAGE

APPROACH
Embracing collaboration is at the heart of what we do
We leverage our connected network and a comprehensive approach to sourcing, investing, and portfolio support to
ensure we win the best deals and add strategic value post-investment

Healthcare specific go-to market advice

Great entrepreneurs come to us.
Our reputations, relationships, Engaging industry insiders as part of diligence
and support …value us so greatly
SOURCING METHODOLOGY

SOURCING METHODOLOGY

Nevin is great, Nevin is SOURCING METHODOLOGY

great, Nevin is great,

Nevin is great”
- Derek Quote

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OUR ADVANTAGE

APPROACH
Embracing collaboration is at the heart of what we do
We leverage our connected network and a comprehensive approach to sourcing, investing, and portfolio support to
ensure we win the best deals and add strategic value post-investment

Advantaged deal flow

Great entrepreneurs come to us.
Our reputations, relationships, Industry insider input into screening, diligence and
and support …value us so greatly company growth

Early-stage investment and company-building practices

Healthcare specific go-to market support

Nevin is great, Nevin is
“InnovateHealth Connect” flagship community events
great, Nevin is great,
Nevin is great” Connected ecosystem and strategic insights for LPs
- Derek Quote

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APPROACH

Investor Positioning
Strategic, specialist value at seed
There is relatively little direct competition for seed-stage, specialist, strategic healthcare venture funds

CVCs typically
Sourcing Alpha
$10M+

invest later, and Our sourcing engine leverages robust networks and strategic
B+

move at a slower
Most specialist healthcare investors partnerships to see deals before they are on the radar
pace
with strong networks have raised
larger funds, and have moved their
$2M - $5M $5M -$10M

investment scope
to later stages Early Conviction
A

Our expertise and network enables us to build conviction early

before market consensus and valuations become overinflated
Where expertise Most healthcare
Right to Win
Seed

and network seed investments

provides the are made by
Generalists Our strategic value will allow us to win the best deals, de-risk,
strongest edge
and improve the trajectory of our portfolio
Pre-Seed
$1M - $2M

Typically, angels and small check

sizes; seed funds for optionality
Fund Size Alignment
Our strategy for a relatively smaller fund balances portfolio
construction (i.e., diversification and ownership percentages)
Corp. Venture Strategic Specialist Generalist
with typical round sizes, and smaller funds tend to outperform

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APPROACH

Portfolio Construction
Balance of diversification and ownership

Target Investments ~20 companies

Primary Stage Seed (Pre-Seed, Seed, Seed Extension, Early Series A)

Carefully crafted and
Role Flexibility to lead, co-lead, or follow
disciplined approach to
$250k - $1m
maximize the impact of Check Sizes
maximum per portfolio company is 10% of the fund
our expertise on portfolio Average Ownership 5% (2.5-7.5%)

companies and the Initial Check / Follow-on Reserves 50% / 50%

impact of portfolio Target LP Returns 3 – 5x / 20% unlevered IRR

company outcomes on Investment Horizon 8 – 10 years

fund performance Risk-adjusted Return Potential 0.5 – 1x Fund, for each investment

Active Involvement Board Director, Observer, or Major Investor status

In comparison to Sandalphon Ventures II, InnovateHealth Ventures I will continue the same
proven portfolio construction strategy utilizing stage, check size, and business model focus as
core tenants of the strategy, but specialize for healthcare through the addition of two domain
22 expert GPs, an expansive strategic network, and a focused advisory team while also retaining
higher follow-on reserves for our high-conviction and outperforming portfolio companies
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SUMMARY
Why Us
InnovateHealth Ventures I LP
Our highly motivated team
combines the strengths of
experienced investors, leverages an
extensive network, and applies a
rigorous diligence process and
support playbook to mitigate risk
and target outsized returns
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Deep Expertise
Our leadership team and advisory network
combines diverse domain expertise from
health plans and health systems with a
polished seed investing skillset
Proven Platform
We are expanding and focusing the fund
strategy based on an existing institutional,
seed investing platform with top-quartile
returns across two funds
Informed Deal Selection
We leverage a broad strategic network with
a rigorous screening and diligence process
to identify the best opportunities
Confidential
Right to Win
We have a compelling value proposition for
early-stage companies that resonates with
both founders and our co-investor network
Value Generation
Our access to strategic partners coupled
with a systematic playbook is a recipe for
consistent value creation post-investment
A Lasting Partnership
Our partners and advisors have a
commitment to building a venture platform
that stands the test of time, and is mutually
beneficial for our limited partners,
founders, and community
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SUMMARY

Summary of Terms
InnovateHealth Ventures I LP

$250,000 for Individuals

$25m target
Fund Size Minimum Investment $1,000,000 for Institutions
($15m min first close, $40m max)
(lower at management discretion)
No more than 20% every 6
Fund Life 10 years + up to 3 x 1-year extensions Capital Calls
months
Quarterly Reporting &
Investment Period 4 years Reporting
Newsletter

Recycling Period 4 years Auditor Plante Moran

GP Commitment 1% Administration Carta

2% average (2.5% for 4 yrs, 2% for 2

Management Fee Legal Cooley LLP
yrs, then 1.5%) paid quarterly

Formation Expenses $200,000 cap First Close Incentives Discounted carry

Carried Interest 20% Large Check Incentives Discounted carry

24
MAX INVESTMENT?
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Appendix

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EXPERIENCE

History
Firm timeline and future plan
2016 2021 2024-5 2025-6 2027 2028

Sandalphon Capital [Innovate Partners]

Generalist Funds Series of Specialist Funds

Future Team –
Healthcare
HealthEco
Jami

InnovateHealth InnovateHealth
Ventures I
Elevance
(Healthcare Ventures II
Nevin (Healthcare Specialist)
Specialist)
Sandalphon
Ventures II
Sandalphon (Generalist)
Macquarie Ventures I
(Generalist)
Jonathan

Shared Services

Future Team -
Other Sectors

Note: Jonathan Ellis will continue to manage Sandalphon Ventures

I, Sandalphon Ventures II, and may raise funds focused on other
complementary sectors as part of a broader platform. Healthcare
29
is the first a of a series of anticipated industry-focused funds, with
a shared services and back-office strategy.
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EXPERIENCE

Our Advisory Network

Strategic payor relationships Quote?

Payor Network

Responsible for strategy, corporate venture, and executive leadership for national and regional payors across Medicare,
Medicaid, and Commercial lines of business

Eric Steager Niclas Kohler Lourdes Rivas

• Former Head of Corporate Venture at
Elevance Health
• Former Co-Head of Corporate Venture
at Independence Blue Cross
• Responsible for $300+ million in
strategic investing over 2 decades
• Former Staff Vice President of
Corporate Development at
Elevance Health
• Former VP of Strategy at Alignment
Healthcare (prior Elevance Health)
• Current Managing Director of Corp
Dev at Health Management Associates
• Former President of Medicare East
Region for Elevance Health
• Former President & CEO of Simply
Healthcare (acq. by Elevance)
• Current Independent Board Member
of Liberty Dental

Ryan Miller Cathy Eddy Steve Schlegel

• Former Head of Corp Dev & Strategy
at Change Healthcare
• Former Head of Corp Dev & Strategy
at Availity
• Current New Mountain Capital Advisor
to Apixio and Personify
• Former Founder and President of
Health Plan Alliance
• Experienced strategic advisor and
board member
• Former Head of Corporate
Development at Elevance Health
for 15 years
• Responsible for over $20 billion of
strategic M&A and investing
• Current Board Member and Chair
of the Audit Committee at Amwell

30 Plus more being added… Our advisors bring deep domain expertise, founder support, and access to a broader ecosystem of payors and providers
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EXPERIENCE

Our Advisory Network

Strategic provider and operator relationships Quote?

Provider and Operator Network

Responsible for operations and strategic guidance of leading provider organizations across the nation,
prioritizing high quality care for their respective patient bases

Roman Margolin Chan Basho Priya Bathija

• Former Managing Director of
Genstar Capital (HCIT focus)
• Experienced strategic advisor
and board member
• Current Chairman of the Board
for ConnectiveRx
• Current CFO and COO of Astrana
Health (NASDAQ: ASTH)
• Former VP of Corp Dev & Strategy
at Alignment Healthcare
• Former VP of Corp Dev & Strategy
at DaVita Medical Group
• Former VP of Strategic Initiatives for
the American Hospital Association
• Former Counsel for MedStar Health
and ProMedica Health System
• Founder of Nyoo Health, providing
support for women’s health startups

Neil Hattangadi, M.D. Raj Shrestha David Cohn

• Founder and CEO of Cortica, a
leading autism provider for children
• Last raised a $115 million Series D
led by LRVHealth and CVS Health
• Experienced healthcare focused
advisor and board member
• Former Founder and CEO of Castell
(Intermountain VBC platform)
• Former Founding Executive of Cigna’s
Care Allies Division
• Current CEO of MyCare Medical
• Former Founder of CEO of Regoup
Therapy (dba Array)
• Raised approximately $19 million in
venture funding while leading Regroup
• Current Founder of Sanarte
Health (a Sandalphon Fund II
Portfolio Company)

31 Plus more being added… Our advisors bring deep domain expertise, founder support, and access to a broader ecosystem of payors and providers
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Confidential
OPPORTUNITY

The Problem
Breaking point of US healthcare

National Healthcare Expenditures 1 Healthcare Costs per Capita 1

Costs projected to $7.2T Commercial – 62% increase
Healthcare costs will grow faster in grow by a 5.5% CAGR
over the next decade Medicaid – 58% increase $24,211

this decade then any decade before, Medicare – 63% increase

$4.5T
driven by inefficiencies from a siloed $14,854 $14,066

and uncoordinated healthcare system $8,906

$9,898

$6,126
managing an aging and increasingly
sick population
2022 2031E 2022 2031E

Increase in Chronic Disease 2 2030 Provider Shortage Projections 3

83.4M
Potential shortage of 100k+ physicians
Significant growth in US
population suffering with severe deficits in 33 states
from 3+ chronic
diseases

Notes
30.8M
1. CMS – National Health Expenditures (Updated as of Dec 2023)
2. Hales, et al. Prevalence of Obesity Among Adults and Youth: United States,
2015–2016. NCHS Data Brief No. 288, October 2017
32 3. Zhang X, Lin D, Pforsich H, Lin VW. Physician workforce in the United
States of America: forecasting nationwide shortages. Hum Resources
Health. February 2020 2015 2030 A B C+ C C- D F
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OPPORTUNITY

The Market
A Need For Innovation

Wasteful healthcare
spending is nearly
$935 billion a year

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EXPERIENCE
Past Healthcare Investments
Sandalphon Venture I & II
CARE
Nationwide Mental Health
Telehealth Platform
ADMIN
Data Analytics and
Visualization Platform
ADMIN
Prior Authorization
Workflow Management Platform
CARE
34 Concierge behavioral health
service for families
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Confidential
Investment History Latest Update
Year: 2017 Size: $250,000 Stage: Seed Extension
• Sandalphon Ventures I invested in Regroup Therapy’s bridge round in 2017, just prior to their $6.6m Series A led by OSF Ventures
and OCA with participation from Frist Cressey Ventures, HLM, Impact Engine and others. After our investment, the firm raised
another $17 million from strategic healthcare investors. January 2023: CVS Health Ventures has
• In 2019, Regroup merged with Insight Telepsychiatry to form Array Behavioral Care, the largest telepsychiatry provider in the US, invested $25 million into Array Behavioral Care
offering services along the continuum of care from hospital to home.
Year: 2021 Size: $350,000 Stage: Seed March 2024: ARR has grown from $600K to
$2.5M (soon to be $4M) since we invested,
• Sandalphon Ventures II led Metopio’s $1 million seed round ($6m pre money valuation cap) alongside MATH Venture Partners, while the company has been cash flow positive
Chicago Early Growth Ventures and various angel investors
• Since the investment, Metopio has consistently grown its client base amongst health systems, rural hospitals, and public health Financing round and valuation increase
agencies, with use cases ranging from required regulatory reporting, internal strategy, public health portals and population expected in 2024
health/social determinants of health
Year: 2022 Size: $250,000 Stage: Seed February 2023: Center for Medicare and Medicaid
Services (CMS) issued a proposed rule to address the
• Sandalphon Ventures II invested in Itiliti Health’s seed round ($10m post money valuation) in late 2022 alongside Excelerate administrative hassles of prior authorization by requiring
Ventures, Bread & Butter Ventures, and Altitude Ventures certain payers to implement an automated process,
speed up decision making, and improve transparency
• At time of investment, Itiliti had landed and begun implementing two new enterprise-wide contracts with Blue Cross Blue Shield
plans, and is currently positioned as one of very few prior auth vendors, assisting health plans in managing prior auth claims November 2023: raised a bridge round
March 2024: Brand new investment, launching
Year: 2024 Size: $250,000 Stage: Pre-Seed in summer 2024
• Sandalphon Ventures II invested in Sanarte’s $1m pre-seed round ($6m post money valuation cap) in March 2024 alongside a
selection of HNW individuals
• Sanarte is pre-launch however we have known the founder for almost 8 years and we’re excited about the scalability and capital
efficiency of this innovative approach
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OPPORTUNITY

Illustrative Investment
Sandalphon Ventures II LP
Fund Investment

InnovateHealth Ventures
Thematic Fit

Providers

The current system of “industrialized” Future

Demographic: Insurance Type: Transition Insurance Type:
behavioral healthcare leads to sub-optimal, Families Out-of-Pocket Employer / Government
fragmented care
INNOVATE
The Sanarte model puts the family in the CARE
center, supporting each individual and the
family unit as a whole Access to
Care
Sandalphon Ventures II LP has secured 4%
initial ownership as part of the Company’s Mental Health
Pre-Seed SAFE round

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APPROACH

Sourcing Methodology
Generating high-quality deal flow

Sourcing Channels Geographic Reach Strategic Referrals

• Deal flow through network of advisors Sourcing from across the US, focused on
and strategic partners key geographies and healthcare hubs to
• Targeted outreach driven by market efficiently cover the entire market
Payors
research, industry knowledge, and Providers /
Health
insights on payor or provider needs Systems
and priorities
• Extensive generalist and specialist
Service
co-investor and founder network Providers

• Inbound leads driven by profile raising

efforts including social media, original
content, thought leadership and
speaking engagements
• Attending and hosting Legend
healthcare-specific and generalist Proprietary Deal Flow
Key healthcare hubs (IHV coverage areas)
startup/VC events

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APPROACH

Investment Methodology
Building conviction early

Structured process
leveraging the
benefits of our
strategic network,
resulting in a portfolio
Investment
Screening Initial Diligence Full Diligence Invest & Support
of high-conviction, Committee

derisked companies Selecting and Qualifying Deep diligence with Analysis of all Value creation
prioritizing targets business problem, strategic partners, information strategy initiated
that fall within progress, and advisors, and collected and leveraging
thesis, focus, and strategic alignment subject matter decision to invest network and
company profile experts advisors
thresholds

OUR METHODOLOGY INCLUDES

• Rigorous early-stage scorecard • Strategic Advisor input • Founder Site Visits

• Due diligence best practices • Strategic Network perspectives • Value creation strategy
37
• Market and competitive analyses • Customer discovery • Regular Partner discussions
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APPROACH

Portfolio Support
Our right to win

Early-stage healthcare
companies need more than
just funding to succeed,
they require intelligent
investors who can provide a
wealth of industry-specific
guidance and resources, as
well as extensive access to
their target markets
FOUNDATIONS
Establishing a cadence of
engagement and exchange
while connecting the early
ecosystem through:
• Monthly Meetings
• Founder Roundtables
• Financial Operations
• Governance
• Founder (mental) Health
VALUE CREATION
GRADUATION
Propelling company trajectory and
success with curated support across
Ongoing support and
the early-stages of a company’s
engagement with
lifecycle through:
transition to scale-up
partners through:
• Network Activation
• Advisor Guidance • Future Fundraising
Strategy
• Industry Roundtables
• Capital Connections
• Product-Market Fit
• Access to Strategic
• Go-to-Market Strategy Investors
• Commercialization Process • Follow-on Investment

COMMUNITY

Empowering portfolio companies with a robust healthcare ecosystem that encourages peer collaboration,
38 offers comprehensive support services, and provides exclusive access to our investor events events and
executive network
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APPROACH

Limited Partner Engagement

Transparency and connectivity
We have built lasting relationships in the healthcare industry and are now seeking to build long-term limited
partner relationships to help us achieve our mission to improve the health of our healthcare system

ANNUAL MEETING PORTFOLIO COMPANY SPOTLIGHTS SOCIALS & EVENTS

Market and portfolio company updates, Webinars led by portfolio company Bringing our community together through
plus a chance to connect with portfolio leadership providing insights into progress new and existing industry events,
teams and other strategic limited partners and opportunities for value creation cultivating relationships and connections

QUARTERLY NEWSLETTER TREND & INSIGHTS AUDITED REPORTING

Regular reporting with portfolio company Quantitative and qualitative insights into Third-party audit on annual fund
updates and opportunities, and ongoing the venture capital and healthcare financials, statement of investments and
visibility into fund performance market aggregated across our network investment valuations

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APPROACH

Community Engagement
Expanding our ecosystem

InnovateHealth Connect is our event platform to engage with the

early-stage healthcare technology ecosystem targeting founders, Innovators
investors, and accretive organizations. We host curated events in
partnership with sponsors, event organizers, incubators, and
accelerators to maximize the efficiency and impact for our firm and
portfolio companies. Accelerators Startups

Annual Conference

A virtual summit engaging the early-stage healthcare technology and

services ecosystem creating connections and content to maximize
CONNECT
one-on-one meetings between healthcare Pre-seed to Series A stage
start-ups and investors (venture capital and accredited angels). Angel
Incubators
Investors

Branded Events (target)

• Annual Virtual Summit Venture
• Industry Socials-within-Events Capital Firms

40 • Regional Socials & Happy Hours

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APPROACH

Org Structure
Standard venture fund legal structure

Sandalphon Capital LLC (Management Company)

employs / contracts with

Jonathan Jami Nevin TBD 2-4 interns - pays

Ellis Youmans Ramanujan VP/Principal typically 2 management
(Partner track) days/week fee to
Managing Partner General Partner General Partner

makes decisions on behalf of

InnovateHealth Ventures I GP LLC (GP) InnovateHealth Ventures I LP (Fund)
fund management and decision-making cash and investment assets
receives carried interest from

dollars invested dollars distributed

advisory relationship with

provide insights to
Advisors Strategic LPs

41

APPROACH
Learning From Mistakes
Stay humble and always iterating
#1 Sandalphon Ventures I Learnings
Small checks mean limited access to information
and influence; cannot rely on co-investors to
drive positive outcomes
Relatively few local/regional conviction lead
Seed investors, more followers
Very few truly active Pre-Seed investors in
the region
Very few local/regional Seed funds with strong
“platform” offerings
Set aside capital to solve problems
Being a good “picker” will not be enough to win
the best deals
Quality over quantity
Very few funds with truly regional presence;
we have better than average regional network
Invest in what we know
Early on, we’re investing more in the people
more than the business and each hire has a
huge impact
We are perceived as having a better than
average portfolio by some of our peers
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Increase bandwidth
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#2 Sandalphon Ventures II Actions
Increase fund size to write larger checks,
investing ~25-33% of rounds; increase target
ownership to 5-10%; secure major investor
status and ideally board or observer seats
Be willing and able to lead or co-lead deals
Create dedicated Pre-Seed allocation
Create platform offering to differentiate
Increase fund size, reserve for bridge rounds
e.g. Bridge to sale, or just additional follow-ons
Increase team size (bandwidth) and budget,
develop platform offering
Be selective, be patient; balance adequate
diversification with adequate attention
Lean into regional brand and connectivity;
lean into being network-driven, be known as
a connector
Broaden team, advisor and LP networks
and expertise
Create “Two Cents” program to literally invest
in the people; invest in talent/recruiting
support function
Include our Fund 1 founders as operator
advisors for Fund 2 and potentially future
funds, compounding our collective knowledge
and network
Increase fund size with appropriate fee
structure to build out our team
#3 Sandalphon Ventures II Learnings
Much better visibility, but much more time
involved with portfolio companies
Flexibility works, leading takes up much more
time pre and post investment
Pre-Seed checks take as much work as Core
checks, if not more. Relatively little competition
but valuation difference not enough to outweigh
additional risk
Did not have the resources to build out
platform offering
Fundraising environment limited fund size,
lower follow-on reserves than ideal
Did not have the resources to build out platform
offering; continue to grow team
All-time peak market activity resulted in
faster deployment
Capitalized on Midwest network but getting
pulled into other markets
Continuing to refine areas of focus
Did not have budget or bandwidth
to operationalize
Operator advisors have been very helpful, but
better to be deep than broad in terms of
sector/experience
Fundraising environment limited fund size /
budget, bandwidth still essential
Confidential
#4 InnovateHealth Ventures I Actions
Add GPs and Increase number of deal leads to
ensure adequate portfolio company attention,
ensure time-based cohort diversification to
spread intensity
Be very selective about board seats, broaden
board participation among team and advisors
Include very selective “Late Pre-Seed”,
better to have real ownership vs just a small
toehold position
Focus on tangible sector-specific value-add,
easier to operationalize than a very broad
offering
Larger first close target, larger fund target, 50%
follow-on reserves
Go broad AND deep in sourcing, strong
emphasis on “right to win” messaging to market
Focus on 20 instead of ~25 given industry
specificity, still enough diversification for power
law; pacing
Given the industry focus the national footprint
particularly in healthcare hubs more important
to see the best US deals vs best of Midwest
10x our domain expertise and ability to add
value directly by focusing on healthcare
Emphasize importance as part of
post-investment support but encourage use of
third-party solutions
Track record + industry focus in terms of
portfolio and advisors will create strong flywheel
Shift from 1 to 3 GPs, potential 4th hire,
targeting larger fund for larger team
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InnovateHealth Ventures I
330 N Wabash, Suite 2300
Chicago, IL 60611
Innovatehealth.vc
Jonathan Ellis Nevin Ramanujan Jami Youmans
Managing Partner General Partner General Partner
jonathan@innovatehealth.vc nevin@innovatehealth.vc jami@innovatehealth.vc
(312) 402-9793 (253) 347-6887 (816) 805-3310

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