CoverMyMeds’ $1.1 billion Exit Is A Big Win For Ohio Third Frontier

The coming $1.1 billion acquisition of CoverMyMeds LLC – Ohio’s first tech startup ” unicorn” – is a huge win for the Ohio Third Frontier program.

McKesson Corp., one of the three biggest U.S. health-care products distributors, announced Wednesday it would acquire the fast-growing Columbus software maker in a deal that could grow to $1.37 billion depending on its financial performance over the next two years.

“For a pure tech company, I’m not aware of any other unicorn investment (in Ohio),” said Ray Leach, CEO of Cleveland-based JumpStart Inc. “We’ve accomplished something we all weren’t maybe brave enough to utter.

“This is a great signal the investments of the Ohio Third Frontier have supported companies that have the potential to grow to be quite large and can be meaningful on the national scene,” he said. “Now the challenge is to do that again and again and again.”

JumpStart, the nonprofit technology investment group that administers Ohio Third Frontier technology bond funds for northeast Ohio, in 2010 through 2012 invested $500,000 in CoverMyMeds, in addition to providing guidance and industry introductions, according to its website. It also loaned $100,000 that has been repaid.

CoverMyMeds was founded in Twinsburg in 2008, launched its software in 2010 and in 2012 moved its headquarters to Columbus.

JumpStart is under a confidentiality agreement not to disclose the amount of its investment return, CEO Ray Leach said, but has been “happy” with the amount of its equity stake as an early investor, even after a 2014 private equity round.

Read the full story at Columbus Business First.