CHCF's Innovations for the Underserved program pursues "program-related investments" (PRIs) in medical and health care devices, technologies, and services through the CHCF Health Innovation Fund.

Program-related investments can be made to meet the needs of potentially revenue-generating organizations that are developing market-based solutions to social problems. PRIs are foundation investments that take the form of low-cost loans, loan guarantees, or equity, rather than grants.

PRIs help extend the reach of CHCF's traditional grantmaking by providing organizations with a business or revenue model with capital to finance, sustain, and grow their programs and initiatives. They help organizations attract new financing from mainstream banks and other funders, or build a credit record to qualify for commercial financing. They help build financial management capacity. And, because PRI funds must be returned to CHCF, the money can be used again for other projects.

In addition to providing capital, the Health Innovation Fund can help with regulatory and reimbursement strategies, provide insight into health care financing and operations, and connect companies to demonstration sites in California.

Eligibility

CHCF will invest approximately $10 million through the CHCF Health Innovation Fund over three years. The fund will consider both nonprofit and for-profit organizations and companies that meet the criteria for the program.

Scope of Investment

The CHCF Health Innovation Fund will consider these investment stages and ranges:

• Prototype-ready products or services with demonstrated customer interest
• Initial investment of $250,000 to $1,000,000
• Capital-efficient business models, typically requiring a total of $15,000,000 from multiple investors

Investment Criteria

Significant impact: The CHCF Health Innovation Fund targets health care services, devices, and technologies that reshape or disrupt existing markets by delivering low-cost innovation to a set of customers whose needs are not currently well met. Projects must aim for significant impact, as measured by improved access to services or care and/or lower cost. Specifically, they must:

• Create sustainable access to care for at least 100,000 people in California over three to five years, with the potential to reach one million people in the United States over time;
• Target cost reduction for a defined population in California that results in annual savings of at least $25,000,000; and/or
• Create a strong case study for policy change that enables statewide or national adoption of products or services that lower cost and/or improve access to the medically underserved.

Strategic alignment: Proposals should demonstrate a clear connection to CHCF's mission of significantly lowering total cost of health care or substantially improving access to care for Californians. Both for-profit and nonprofit organizations with sustainable, competitive business models are eligible.

Experienced management team: Organizations must have an experienced CEO and management team with a proven track record, or be able to attract such a team.

Scale and sustainability: Business models must show potential for growth and scale. For-profit organizations should have the potential to be sold or repay debt within five to seven years; nonprofits must demonstrate clear potential for financial sustainability in that same timeframe.

To Apply

CHCF plans to make approximately two to three major program-related investments each year. We will accept applications for the CHCF Health Innovation Fund only through the link below. To apply, please be prepared to submit:

1. A brief description of the business concept; the market need and problem solved; how the organization will improve access to or lower the cost of care; and how the innovation will benefit the people of California.
2. A business plan, including marketing and sales strategies, technology plan, organization and staffing plan, three- to five-year capital financial projections, and funding requirements; and
3. Resumes of founders and management.

Only complete applications will be reviewed.

You will be informed within four to six weeks as to whether further review will be undertaken and what additional materials may be required. The full review and approval process can take three to six months, as all PRIs will undergo extensive due diligence and must be approved by the CHCF board of directors.

Remember that PRIs are financial obligations that require full compliance and repayment in accordance with the agreed-upon terms and conditions. The decision to approve and fund a PRI is solely within the discretion of the Foundation. This information does not constitute a promise to fund.

For more information, contact Helen Duhe . CHCF staff will not accommodate requests for calls or meetings to discuss proposals that have not been submitted through this process.