Applied behavior analysis-focused software provider Passage Health has raised $8 million in a Series A round.
The New York City-based startup landed investment from the San Francisco-based B2B software venture capital firm Telescope Partners. Passage Health will use the infusion of cash to fund product development, hiring and a push to expand its reach nationwide.
Bill White, CEO and co-founder of Passage Health, exclusively told Autism Business News that the company’s development in its earliest days, starting when it was founded in 2022, was focused on positively impacting the daily lives of clinicians, and clinical staff in the name of simplifying their business operations.
The company offers a specialized consolidated business management and electronic health record for organizations that provide applied behavior analysis (ABA). Within its practice management software, it provides scheduling, billing, data reporting and analytics tools. That includes an interactive clinical progress graphing engine, treatment report builder and clinical treatment progression tools.
“Passage Health’s modern, full suite approach to ABA therapy workflows is solving perennial
challenges for clinicians,” Nicole Naidoo, a partner at Telescope Partners, said in a statement.
The company began by engaging with about 100 ABA provider organizations who said they were stuck with the tools that they had. White and his co-founder Gabriel Khaselev — also Passage Health’s chief technology officer — found that providers and organizations were spread across several different tech services with little to no integration.
Other tech platforms in this space suffered from outage problems, were built ad hoc with little cohesion or had poor user interfaces and experiences.
“Finally, nobody felt like they had a good partner on the other side of the table,” White said. “The common phrases we heard were ‘nickeled and dimed,’ ‘unable to get support when they needed it,’ and ‘we’re already drowning in paperwork.’”
In that early investigation of the space, White and Khaselev also had close personal connections to those who have autism and those who care for them. White babysat a close family friend’s non-verbal autistic child in his youth. As he left his previous professional engagement, he began to consider starting a business that would serve those with autism. One early thought included starting a practice that offered ABA. Rather, he stuck to his career in health care and tech and began work on software for providers.
Today, Passage Health employs about 19 full-time employees and works with about 150 practices.
The autism therapy industry has expanded rapidly after the entrance of private equity funding and a grassroots effort to establish state-level mandates for the coverage of autism therapies. Over the last decade or so, the industry has grown significantly, creating both the demand and need for industry-specific services.
This also attracts significant interest from various types of investors.
The most notable incumbent in autism-industry-related software, CentralReach, was acquired for $1.85 billion — $1.65 net of tax benefit — by Roper Technologies (NASDAQ: ROP) in April. On its most recent earnings call with investors and analysts, executives at Roper said that CentralReach has about 200,000 daily users, is estimated to generate about $175 million of revenue in the twelve months ending in June and operates in “a market with strong sustainable tailwinds.”
Last month, an AI-focused software company, Brellium, landed a $16.7 million Series A to grow its compliance, documentation and organizational intelligence platform, which is optimized for ABA and other specialties that also support those with autism.
