2023 Annual Impact Report
Vintage Year
Total Capital Deployed: $124.2M Debt, $42.7M Equity
Total Investments: 8 Active, 9 Exits
Capital Deployed by Industry
As of Q4 2023, HCAP IV has invested across seventeen companies, with 72% of the capital invested going into traditionally underserved businesses, i.e. businesses that are either located in a low- to moderate-income census tract or employ a majority low- to moderate-income workforce.
The following impact metrics highlighted below illustrate the composition of the portfolio as well as job quality results for 2023.
We are pleased to report that 76% of the jobs in the portfolio were classified as quality jobs under the Gainful Jobs Approach™.
* Percentage of companies with an owner or CEO who is a woman, non-binary individual, or person of color or where the majority of the company management team is comprised of women, non-binary individuals, or people of color.
** Percentage of directors of portfolio company boards who are women, non-binary individuals, or people of color.
Diverse Ownership/ Leadership*
Female Workforce
Board Diversity**
Diverse Workforce
*Total jobs and jobs created reflects data for active companies as of 12/31/2023 and exited companies as of the last period of data collection prior to exit.
Annual employee turnover rate and employee median tenure reflects data only for active companies as of 12/31/23.
**2023 annual portfolio-wide turnover rate among active companies. In comparison, the average monthly U.S. turnover rate in 2023 was 3.6% or
43.2% annualized. See: https://www.bls.gov/news.release/pdf/jolts.pdf.
Total Jobs
Annual Employee Turnover Rate**
Total Jobs Created Since Investment
Employee Median Tenure
Quality Jobs
76% of Jobs in the Portfolio
Increase in Quality Jobs Since Investment
of 2023 Gainful Jobs Approach™ Goals Completed
In 2023, HCAP introduced interviews with portfolio company leaders as part of the process when exiting an investment with a portfolio company. These exit interviews provide an opportunity to reflect on the final results of HCAP’s investment, revisit key milestones and challenges in the company’s journey, invite feedback on ways that HCAP could have better supported the company, and document lessons learned. HCAP believes these conversations will help enhance its value creation efforts with portfolio companies and inform further iterations to its investment strategy and Gainful Jobs Approach™.
Corticare is a provider of neurotelemetry and remote neurological patient monitoring services for hospitals, healthcare systems, physician practices, and in-home care. The company’s services assist in the neurological assessment of adult, pediatric, and ICU patients utilizing electroencephalograms (EEGs) and monitor real-time brain activity and interpret potential seizure risks.
HCAP’s investment thesis with Corticare focused on the opportunity to expand access to care and lower cost of care by leveraging technology to bring remote patient monitoring services to health systems, healthcare providers, and physician practices. This thesis was supported by a number of factors, including: (i)There are approximately 3.4 million people with epilepsy in the U.S. and the most common detection method is through an EEG (ii) There is a continual shortage of registered board-certified EEG technicians and reading neurologists. In the U.S. over 10,000 healthcare facilities compete for 6,000 registered EEG technicians and 4,000 neurologists formally trained to read EEG charts. (iii) High cost of EEG equipment poses a significant barrier to providing care for rural and smaller/medium-sized hospitals that are less resourced.
During the investment period, revenues quadrupled, and EBITDA increased by two and a half times. The company’s workforce grew from 54 employees to approximately 256. HCAP helped the company implement a broad-based stock option plan, an annual employee bonus pool, and a transaction bonus as part of the exit plan, enabling employees to participate in the value creation they had helped achieve.
The following are excerpts from the exit interview with Brad Westcott, along with our team’s reflections.
Brad Westcott
HCAP Reflections
What attracted you to working with HCAP?
“In the beginning, trust was a big deal for me. I was very leery of taking on outside money but knew that we needed capital to reach the next level as a company. I had known Tim Bubnack a long time ago and hadn’t kept in touch. There was a friend who recommended I reconnect with Tim and learn more about HCAP. Through the process, I got to know the HCAP team, and I appreciated our conversations and interactions. The proposed investment structure from HCAP which combined debt and equity helped in establishing trust as we wouldn’t have to give up control of the company. Other investors that approached us wanted to have control or more equity.”
What has been your experience working with the HCAP team and having HCAP as an investor?
“It really has been a true partnership. Hope Mago is probably tired of my phone calls where I’d seek advice or look to him as a sounding board. This has been such a different experience from the limited interactions I had with the private equity firm that invested in my previous company. HCAP has brought important knowledge and expertise, not only in finance and governance, but also operationally, and importantly in healthcare. I knew I could always call, and even with bad news, the relationship would be strong enough that we could work through any issues.”
What are some of the ways HCAP has engaged with you and your team and supported value creation at your company?
“HCAP has supported value creation in a variety of ways, including through governance, fundraising, acquisitions, industry knowledge, strategy, and preparing for exit. HCAP connected us to new board members who brought valuable operational experience and perspective. They helped us raise additional capital to finance growth, assisted us in evaluating different investment banks and, participated in our follow-on capital raises. They also helped us explore acquisitions—meeting target companies and offering valuable feedback and guidance. From an overall perspective, HCAP helped us tremendously in narrowing our focus and setting an appropriate strategic direction. HCAP also helped us evaluate different opportunities for exit, including buyouts and investments that would use the company as a platform to merge in additional companies. Each offer was different. and they helped us determine the right buyer, partner, and culture fit.”
Are there things you wish you or HCAP could have done differently during the investment period?
“We should have focused on margin enhancement and getting the pricing of our services right earlier on. However, we were focused on revenue growth, and this took a back seat. We also didn’t have the team in place to analyze the data and develop a plan to shift the focus to margin enhancement. People were a big challenge for us initially, and it took time to bring in the right Vice President of Finance. We also had a challenge in recruiting human resources staff and had turnover with several hires. We should have invested more in the budget to recruit the right people.”
Looking forward, how else can HCAP support you?
“It would be great to collaborate with HCAP on future deals. I’d welcome the chance to be involved in transactions and help as an industry consultant or serve on the board of one of HCAP’s portfolio companies. I’ve had a great experience with HCAP and would rate it a 9 out of 10.”
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