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This company, founded in 1988, is a developer of a recurring revenue business model medical billing software used by the behavioral health industry.
This business is truly turn-key with strong, stable, long-term staff in place. After the first two months of on-boarding a new client there is a very low level of ongoing staff time required beyond customization (which is billed for), and software updates. The software lease fees become a source of monthly recurring revenue.
This software is used in client clinics in 30 states and includes some larger healthcare systems that appreciate its enterprise-level functionality. There's a low level of annual client churn (less than 11% from 2010-present), and it has attracted, on average, seven net new clients per year.
The company has experienced very high margins (12-month EBITDA margin as of 6/30/18 was 68%), and produces high annual revenue per employee of $559,446, as well as $383,228 in EBITDA per employee.
This business is operated virtually with employees working remotely from throughout the country.
Growth and expansion opportunities include: 1, initiate an active sales and marketing campaign - virtually no marketing or advertising has been done in the past; 2, increase prices - this business' monthly pricing is similar to some competitors maintenance charges AFTER buying software; 3, continued revenue growth will lead to higher margins - this business can grow by about 25% without adding additional staff (its primary expense), so most of that revenue will drop to the bottom line; and 4, offer an out-sourced billing service.
While medical billing software is a competitive field, this business has long-term satisfied clients and has enjoyed significant year-over-year net client gains without marketing the business. Clients appreciate the sole Behavioral Health focus, its enterprise level functionality, and that it can integrate well with other software systems.
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