Calgary Circle Cardiovascular software star promises the answer to all things the heart as she prepares for possible IPO



A Calgary-based company that is quickly becoming the standard-bearer in imaging software for cardiologists around the world has raised $ 10.6 million ahead of a possible initial public offering next year.

Circle Cardiovascular Imaging Inc. CEO Greg Ogrodnick said the funding, led by existing investors Kayne Anderson Capital Advisors of Los Angeles and Yaletown Partners of Vancouver, will help bring the company closer until the end of the year. year, when it decides to pursue an IPO or private financing in the range of $ 75 to $ 100 million.

“We are very undecided,” Ogrodnick said, adding that it would depend on valuations, the availability of capital and the receptiveness of investors.

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Circle has worked with BMO Capital Markets, National Bank Financial and Credit Suisse, but has yet to determine which bankers it will use as advisers for its funding, he added.

The 225-person company makes software used in cardiovascular magnetic resonance imaging (MRI) scanners to read, analyze and organize images viewed by cardiologists when they assess their action plans for patients. The artificial intelligence-based software is now being distributed with new machines made by industry giants General Electric and Siemens. This represents about a third of Circle’s annual sales of over $ 30 million; the remainder comes from hospitals replacing the software supplied with their operating machines with the Circle product.

More than 1,500 hospitals use Circle’s software, including the 10 highest-rated hospitals in the world, according to Newsweek, run by the Mayo Clinic, Cleveland Clinic and Massachusetts General Hospital. Circle, who believes its software can help move more imaging to MRI machines from other methodologies such as nuclear imaging, says it has barely scaled back what it thinks is a market opportunity. of $ 15 billion.

“There is an opportunity to take all the tailwinds behind them and invest in some of these seeds that they have planted as well as their core business to really accelerate their growth,” said the managing partner of Kayne, Nishita Cummings.

Circle is the latest in a series of emerging tech stars including Benevity, Neo Financial and Symend, who have brought much-needed diversity and jobs to Calgary’s oil and gas economy, which has suffered from a prolonged downturn despite a recent surge in energy prices.

“Circle is an example of technology companies we see in Calgary that have now reached a scale where they can continue to self-finance their growth and attract growth capital,” said Hans Knapp, President and Partner of Yaletown.

Mr. Ogrodnick, a seasoned healthcare entrepreneur, co-founded Circle in 2008 with Matthias Friedrich, a German cardiologist who had been recruited to start the cardiac MRI program at the University of Calgary. Their goal was to create cardiovascular imaging software that was superior to prepackaged programs on MRI scanners.

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The opportunity was vast: Heart disease is the leading cause of death worldwide and a huge drain on healthcare resources, with $ 94 billion spent on imaging each year. But the science of collecting and analyzing images of the heart on tens of thousands of scanners around the world is complex. This requires not only capturing images of the organ, but also measuring its functioning. About one in five procedures is unnecessary, redundant, or ineffective, based on frequent misdiagnoses.

Circle has built a flagship program it calls cvi42, inspired by The Hitchhiker’s Guide to the Galaxy series of books, in which the number 42 is determined to be the “answer to the ultimate question” of life, the universe and everything. “For Circle customers, cvi42 is the answer to everything in cardiology,” said Ogrodnick.

Using trained AI on images from multiple heart centers, Circle was able to automate parts of the process, organize, read, and present images. in a way that has dramatically reduced the time and effort required by cardiologists to do their jobs. A 2019 study in the medical journal Circulation: Cardiovascular Imaging found that Circle’s software not only matched the accuracy of human researchers, but did the job 186 times faster, in just four seconds, compared to 13 minutes.

“It’s a perfect solution to a problem,” said John-Paul Carpenter, consultant cardiologist at University Hospitals Dorset in southern England. “Circle speeds up the workflow and provides a robust, easy-to-use solution that is ahead of the competition. He added that Circle is continually tinkering with the offering to make it easier to use and provide 24 hour support. “I think that is setting the standard” in the industry.

Mr Knapp said that since Yaletown’s first investment in 2018, Circle “has done exactly what they said they would do within the time frame they said they would,” including tripling revenue and transforming its revenue model from one-off sales to ongoing subscriptions.

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