Unlocking workforce productivity across the healthcare ecosystem
The birth of healthcare operations
The global healthcare sector faces rapidly increasing demand, constrained budgets and shortages in clinical staff. Today, the software and data businesses we back bring about positive change, improving outcomes for the whole ecosystem - across patients, providers and payors - through our focus on healthcare operations, specialist core systems, life sciences, interoperability and population health sectors.
But all of this started from one single, small (at the time) and complex investment we made over a decade ago: Allocate Software.
Discovering Allocate
In 2014 we found Allocate, a small and complex software business that was listed on the London Stock Exchange. It provided a ‘workflow allocation’ software product to a mix of several industries to help them to ‘allocate’ and roster their staff to the right place at the right time.
Hg saw a huge opportunity for this business to focus solely on healthcare - to plug software into a very ‘analogue’ system, where staffing were typically 70% of a hospital’s cost base, and to digitise the ‘allocation’ of healthcare works across the UK.
We invested and Allocate delisted later that year – but that was just the beginning.
A game of two halves
Hg had two investment phases, first from our Mercury fund in 2014 and then from our Genesis fund in 2018. Each phase had a different investment case and journey for the business
2014 to 2018
Extracting and building the diamond in the rough
Delisting Allocate was only the start of the journey. It was a complex business from which to focus on healthcare, then set off on a growth transformation, through significant investment in R&D, product and a SaaS transition
2018 to 2021
Scaling as a platform in healthcare HumanCapital Management software
By this phase we had created a high-quality business – the next step was to scale. This meant developing better business systems, an expansive M&A strategy and to further build outside of the United Kingdom.
Three core areas of development
Sustained investment in R&D
We invested heavily in R&D, doubling headcount and increasing the overall level of R&D capacity by 3x, which enabled significant investment into the usability and adoption of core products, while building new products to support long-term growth.
This programme was aided by a deep knowledge of complex rostering for nurses, doctors, and AHPs – rooted in a thorough understanding of local regulatory frameworks. This led to leading tech innovation with array of new SaaS products both built internally and integrated through M&A
Expanding Allocate’s global footprint
Building a growing platform, with the execution and integration of four acquisitions as well as a pipeline of 100+ qualified opportunities.
Through this strategy Allocate grew into new markets, leveraging Hg’s networks across Europe to acquire a business in France, a partner in Denmark, and to grow organically in Germany and Spain.
This supported an acceleration of organic growth from 8% at the time of the acquisition to 20% by 2018.
SaaS transition
Hg oversaw the transition from a ‘license & maintenance’ model to a ‘subscription’ model.
This transitioned the business succesfully away from a license-based model to a ~80% SaaS model (migrating 100% of UK customers to cloud) and generating ~90% recurring revenues due to high customer satisfaction.
Sustained investment in R&D
We invested heavily in R&D, doubling headcount and increasing the overall level of R&D capacity by 3x, which enabled significant investment into the usability and adoption of core products, while building new products to support long-term growth.
This programme was aided by a deep knowledge of complex rostering for nurses, doctors, and AHPs – rooted in a thorough understanding of local regulatory frameworks. This led to leading tech innovation with array of new SaaS products both built internally and integrated through M&A
Expanding Allocate’s global footprint
Building a growing platform, with the execution and integration of four acquisitions as well as a pipeline of 100+ qualified opportunities.
Through this strategy Allocate grew into new markets, leveraging Hg’s networks across Europe to acquire a business in France, a partner in Denmark, and to grow organically in Germany and Spain.
This supported an acceleration of organic growth from 8% at the time of the acquisition to 20% by 2018.
SaaS transition
Hg oversaw the transition from a ‘license & maintenance’ model to a ‘subscription’ model.
This transitioned the business succesfully away from a license-based model to a ~80% SaaS model (migrating 100% of UK customers to cloud) and generating ~90% recurring revenues due to high customer satisfaction.
A valued champion in the healthcare sector
In 2021 we agreed to the sale of Allocate to RLDatix, the leading global provider of intelligent patient safety solutions.
In seven years, Allocate Software has become a leading international provider of Human Capital Management solutions, supporting the operational and administrative needs of health, care, government organisations and commercial sectors. In the health and care sector, Allocate continues to enable the delivery of safe and effective care at optimal cost, by helping organisations to have the right people in the right place at the right time.
With over 800 clients and over two million staff rostered daily, Allocate serves the largest public and private sector institutions around the world.
About Allocate
Allocate Software is a leading international provider of Human Capital Management solutions, supporting the operational and administrative needs of health, care, government organisations and commercial sectors. In the health and care sector, Allocate is enabling the delivery of safe and effective care at optimal cost, by helping organisations to have the right people in the right place at the right time. With over 800 clients and over two million staff rostered daily, Allocate serves the largest public and private sector institutions around the world.
Hg’s focus on healthcare technology led to an initial investment in Allocate at the end of 2014, completing a public-to-private transaction from the London Stock Exchange. Hg then worked with management and invested materially to enhance Allocate’s software suite, achieve greater customer engagement, helped the business to enter new geographies and created a strong growth platform, with four strategic acquisitions in the last four years of our investment.
In 2021, Allocate was sold to RLDatix, the leading global provider of intelligent patient safety solutions.
2014
Partnered with Hg
UK
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Healthcare
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