WELL Health (TSX:WELL) CEO talks plans for 2025

Summary

Hamed Shabazi, CEO of Well and Chair of HealWell and WellStar, discusses the companies' AI-driven innovations and strategic acquisitions, including their focus on health data interoperability and AI integration. He outlines HealWell's investment in AI and acquisitions like Orion Health and Mutual Health Solutions, as well as WellStar's recent rebranding and growth in the SAS business. Looking toward 2025, Shabazi highlights continued growth in AI, clinic acquisitions, and cash flow expansion, with plans to launch two publicly traded subsidiaries, WellStar and HealWell, to drive further development in the healthcare sector.

Takeaways

• 😀 Healwell and WellStar are making waves in healthcare technology, focusing on innovative AI solutions and transformative acquisitions.
• 😀 Healwell's recent acquisitions of Mutual Health Solutions and Orion Health enhance its AI capabilities, intellectual property, and distribution points for AI deployment.
• 😀 Orion Health is a global health data interoperability company that helps major health systems consolidate data and provide a unified view of patient information.
• 😀 Healwell aims to leverage AI to offer more insights into patient and citizen data for public sector customers, improving healthcare interventions and education programs.
• 😀 WellStar, a tech platform supporting clinics, has been rebranded and received significant funding to accelerate growth and increase its SaaS (Software as a Service) revenue.
• 😀 WellStar has shown consistent growth with a rule of 40 metric, growing at over 20% organic revenue rates with margins above 20%.
• 😀 Healwell has made a large investment in AI and is working towards control of the AI space, with potential plans to make it a publicly traded subsidiary.
• 😀 In 2025, Healwell plans to continue expanding its AI platform and driving growth through acquisitions and organic development in healthcare clinics.
• 😀 WellStar’s path forward includes raising $50 million in funding and expanding towards $70 million in revenue for the next year, aiming for $100 million before launching as a separate public company.
• 😀 WellStar and Healwell's expansion plans are focused on growing free cash flow, deploying cash into profitable assets, and managing liquidity with minimal dilution for investors.

Q & A

What is the primary focus of HealWell's capital allocation program?

HealWell's capital allocation program primarily focuses on two key areas: enhancing AI capabilities, including intellectual property, competency, and algorithms, and acquiring distribution points for deploying AI in healthcare settings.

How does HealWell plan to use AI in its acquisitions?

HealWell plans to use AI by leveraging its intellectual property to build advanced co-pilots and deploy AI in acquired assets, enhancing healthcare services with creative benefits, especially in large health systems.

What is the role of Orion Health in HealWell's AI strategy?

Orion Health is a global health data interoperability company that helps major health systems integrate data silos and build data lakes. HealWell plans to integrate AI into Orion Health's platform to offer enhanced insights for public sector customers and improve patient care.

What is WellStar's role within the broader strategy of HealWell?

WellStar is HealWell's tech platform, providing digital services to healthcare providers. It supports clinics by offering a SaaS platform, contributing significantly to revenue growth and the overall strategy of expanding HealWell's digital infrastructure.

How does the rebranding of WellStar impact its operations?

The rebranding of WellStar allows investors to focus specifically on its SaaS business, which has shown significant growth and profitability. This separation from the care business allows for clearer investment opportunities in the digital platform.

What are the financial goals for WellStar in 2025?

WellStar aims to reach $70 million in revenue by next year, with a long-term goal of reaching $100 million in revenue. This goal will be achieved without relying on further mergers and acquisitions.

What is HealWell's strategic vision for 2025?

HealWell's strategic vision for 2025 includes completing its path to control over its AI investments, potentially making HealWell a publicly traded subsidiary. The focus remains on expanding AI capabilities and growing both organically and through clinic acquisitions.

How does HealWell plan to manage its financial growth in 2025?

HealWell aims to continue growing its free cash flow and cash flow per share, focusing on deploying this cash flow into profitable assets to drive further growth. They plan to avoid meaningful dilution while seeking liquidity for strategic buybacks.

What trends does Hamed Shabazi anticipate will shape the healthcare industry in the coming years?

Hamed Shabazi anticipates that AI will continue to play a major role in transforming healthcare. The focus will be on integrating advanced AI technologies to improve patient care, drive efficiencies, and enhance data interoperability across health systems.

What does the future look like for HealWell and WellStar in terms of public trading?

Both HealWell and WellStar are on a path to becoming publicly traded subsidiaries of Well, with Well retaining majority ownership. This structure will allow investors to choose between investing in the clinic business (Well) or the SaaS business (WellStar).