Latest news with #HemantTaneja
Yahoo
6 days ago
- Business
- Yahoo
Grammarly receives $1bn from General Catalyst to expand AI
Grammarly has secured $1bn in financing from General Catalyst to expand its AI productivity platform. The investment will be used to scale sales, marketing, and strategic acquisitions, enabling Grammarly to grow its customer base and extend its reach. General Catalyst provided the go-to-market funding from its Customer Value Fund (CVF). Grammarly said that its AI-powered platform is relied upon by more then 40 million users daily, contributing to an annual revenue exceeding $700m. General Catalyst CEO Hemant Taneja said: 'We have been working with the Grammarly team for years as they became an early leader in applied AI. 'We are confident that this extension of our partnership will create significant long-term value and continue to drive Grammarly's ability to accelerate enterprise adoption through transformed workflows and communication across industries.' According to Reuters, the funding from General Catalyst's CVF represents one of the largest investments aimed at supporting late-stage tech firms such as Grammarly in boosting growth through new customer acquisition. This targeted capital enables the company to redirect resources typically allocated to sales and marketing toward enhancing product development. Unlike conventional investments, General Catalyst will not take an equity stake in Grammarly. Instead, the firm will receive a limited return tied to the revenue generated from the use of these funds, structured as a percentage of the income from customer acquisition initiatives. In January 2025, Grammarly acquired the productivity platform Coda and appointed its former CEO, Shishir Mehrotra, as Grammarly's CEO. Commenting on the latest investment, Mehrotra said: 'Integrating Coda and Grammarly has unlocked tremendous potential for how people work and communicate. I am energised by the innovation happening across our teams as Grammarly has become a productivity platform serving everyone from individual students to growing businesses to large enterprises. 'The breadth of what we can now offer is truly compelling. With General Catalyst's continued partnership and confidence in our vision, we can scale faster and more sustainably to reach the millions of people who can benefit from our tools.' "Grammarly receives $1bn from General Catalyst to expand AI" was originally created and published by Verdict, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Business Insider
28-05-2025
- Business
- Business Insider
General Catalyst's Hemant Taneja is trying to redefine venture capital — and baffling the industry
Venture firms are normally in the business of backing high-flying tech startups, so many in the industry were scratching their heads when General Catalyst bought a chain of hospitals. The San Francisco-based firm spun out a separate healthcare unit, dubbed the Health Assurance Transformation Company or HATCo, in 2023 to buy Akron, Ohio-based Summa Health the following year. GC committed about $1 billion over seven years for the acquisition from the firm's balance sheet, outside its typical fund structure. The deal was perplexing. Healthcare rarely delivers the kinds of sky-high returns that define venture success; even within GC's own $36 billion portfolio, healthtech valuations often lag far behind tech's starriest bets. "Why would you buy a hospital system if you're in venture capital?" asked one of the firm's limited partners, who requested anonymity. "It's strange." GC is not trying to be a traditional VC firm; it now prefers to brand itself as "a global investment and transformation company." Its leader since 2021, Hemant Taneja, holds the title of CEO, a common role in corporations that's nearly unheard of at a venture firm. "Dare I say it: venture has gotten comfortable and lazy," Taneja wrote in his 2022 year-end letter, spelling out the firm's new direction. "We have to transcend the traditional VC mindset if we're going to make a difference." (Through a spokesperson, Taneja denied multiple interview requests. A spokesperson for the firm responded with written statements.) Under Taneja, GC has amassed stakes not only in hospitals but also old-line accounting firms and manufacturing companies. It's building up a wealth management business, expanding its global lobbying arm, and underwriting loans for startups that are more commonly the domain of banks. The firm recently parted ways with managing directors with traditional VC experience, including Kyle Doherty, Adam Valkin, and Deep Nishar. Two people familiar with the matter told Business Insider that other departures will be announced soon. Meanwhile, GC is building up its ranks of bankers, this month adding longtime J.P. Morgan tech banker Madhu Namburi, who joined Paul Kwan, former West Coast head of tech banking at Morgan Stanley. All these steps are laying the groundwork for GC to someday be the first venture firm to go public, a person with direct knowledge of the matter told Business Insider. Although nothing has been filed yet, they said GC's IPO ambitions are frequently discussed at the highest levels of the firm with the goal of generating ever-higher management fees to someday attract a higher valuation from public investors. "If you want to go public, you are measured on your management fees, not on your profit pool," said the source. (A GC spokesperson said no plans for an IPO are underway.) "Hemant is at a stage in his career where he's really taking big swings to leave a legacy," said Aniq Rahman, CEO of GC-backed Fabric, who added that he had no knowledge of any IPO plans. For now, GC is judged on investment performance, and the early returns are less than promising. As of last year, GC had a dismal internal rate of return, or IRR, of just 2.9% across 10 funds since 2020, according to filings from one of its investors, the LA City Employees' Retirement System. The funds are still relatively new and could someday be successful. Still, GC ranked a distant last in the performance of LACERS' top 10 largest holdings and was the only one in single digits. The typical IRR for 5-year-old funds was around 15%, according to data from Cambridge Associates. (The GC spokesperson said the LACERS performance data is outdated, and that the firm's performance has improved considerably since last year.) "Everything comes down to exits," said a healthcare investor who's frequently co-invested with General Catalyst. "GC can diversify and do what they want to do, but LPs [limited partners], at the end of the day, will look for dollars distributed. That's just the barometer of success." GC sits among a rarefied handful of megafirms like Andreessen Horowitz and Sequoia Capital that are unlikely to achieve blockbuster venture returns but can still reliably produce a safer and smaller return, according to Jai Das, co-founder at Sapphire Ventures. "I wouldn't even call them venture funds anymore," said Das. "They're almost like an asset manager with different products that you invest in." The question is whether such a sprawling vision encompassing more than 800 companies will pay off for investors. Taneja made a name for himself at GC as an early backer of Stripe, the payments processor that is now worth $91.5 billion. Other savvy bets included Snap, Gitlab, and Gusto. Those who have known Taneja from his college days say he has always stood out as ambitious and smart, if a little unfocused. "Hemant went and got five MIT degrees before figuring out what he wanted to do," said Brad Porter, CEO & Founder of GC-backed Collaborative Robotics, who attended MIT with Taneja. "I remember Hemant being brilliant, but not knowing exactly where he wanted to go." The past year has been a busy one for GC under Taneja. In September, the firm announced the General Catalyst Institute, a global think tank aiming to influence government tech policy around the world. The next month, it closed $8 billion of new fundraising. At the beginning of this year, the firm announced a wealth management arm, GC Wealth, to provide investment advisory services with a $2.3 billion pool of assets. (Andreesen Horowitz, Sequoia Capital, and New Enterprise Associates are among the firms that also offer wealth management.) GC has also been expanding its AI-rollup strategy, buying the sorts of businesses VC usually won't touch, like accounting firms and call center companies, and trying to make them more efficient with AI. GC now employs over 250 people to manage its expanding directives, a big jump from the 64-person team the firm had before Taneja became CEO in 2021. And the firm has been steadily increasing its involvement in the healthcare industry since Taneja cofounded the diabetes company Livongo inside GC in 2013. GC was Livongo's largest shareholder at the time of Livongo's 2019 IPO, which valued the company at $2.5 billion, making GC's 22% stake worth more than half a billion dollars. Teladoc then bought Livongo for a record-breaking $18.5 billion in 2020, lending further credence to Taneja's expanding healthcare strategy. Modernizing healthcare has long been a passion for Taneja, who cowrote a book in 2020 called " UnHealthcare: A Manifesto for Health Assurance" that advocated for solutions for what the authors described as "America's healthcare debacle." But no VC firm before GC has ever acquired a hospital. Those deals are typically reserved for private equity, and they've recently faced a deluge of public and federal scrutiny. Steward Health Care, a Massachusetts-based system of nine hospitals formerly owned by a private equity firm, became the center of that conversation last year when it declared bankruptcy, drawing ire and even a congressional inquiry over reports that it prioritized profits over patient safety — a cautionary tale for any private investor looking to play hospital operator. GC says the acquisition isn't just a profit play. The firm's goal isn't just to modernize one hospital system — it wants to create a playbook for health systems nationwide. The firm said it plans to transform Summa Health by improving its tech, at least in part with its own portfolio companies. GC has made about 130 healthcare investments to date, according to its website, including in Commure, the $6 billion healthcare software startup Taneja cofounded and a likely pick for a Summa Health contract. Commure has become an umbrella for other healthcare companies, with seven acquisitions under its belt since its 2020 launch, including two of GC's previous investments, Athelas and Memora Health. (The GC spokesperson said the firm is in the early stages of reviewing technologies for the HATCo business, including those from GC's portfolio companies, and said speculation about Summa's plans with specific companies is premature.) GC is also banking on a network of health system partners that Taneja has spent the last decade growing, including Nashville-based HCA Healthcare, which has a stake in Commure, and Philadelphia-based Jefferson Health, which notched a partnership in 2021 to work with several of GC's portfolio companies. The GC spokesperson said the healthcare ecosystem the firm has fostered will help HATCo build "something traditional venture could never match." "At the end of the day, it's a really powerful sourcing machine that they've built, that plays in every segment of the industry," said a healthcare investor who has made several co-investments with GC. "They're just going to get more shots on goal than other people." HCA Healthcare, the largest health system in the US by number of hospitals, began partnering with GC in CEO Tanay Tandon, the former CEO of Athelas. HCA Healthcare has a stake in Commure as part of its GC partnership. Athelas Most of GC's returns in healthcare remain unrealized. And its healthcare portfolio has already taken a major hit with the rapid fall of startup Olive. GC first invested in Olive, which aimed to use AI to automate healthcare administration, when the firm led a $51 million investment into the company in 2020. But Olive fell into the classic VC trap: raising massive amounts of cash, growing too fast, and flaming out. The startup raised $900 million, reaching a $4 billion valuation in 2021. Two years later, Olive shut down for good. Much of Taneja's strategy seems to revolve around the maxim that bigger is better. It's a lucrative thesis for VCs, since limited partners typically pay 2% yearly fees on assets under management, whether the investments pay off or not. If the firm goes public, higher fees would increase revenue, which in turn would lead to a higher valuation. Taneja raised eyebrows among some VCs when he recently addressed fees in a LinkedIn post. "There's been a recent narrative in some venture circles about 'AUM maxxing'—that firms (like ours) are focused on growing assets under management for the sake of fees rather than long-term performance," he wrote, arguing that funds will still be judged on their distributions. "It's true that scaling platforms can bring new complexity—and that fund multiples may compress over time. But the potential to create value at scale is greater than ever." While some founders could feel lost among more than 800 companies, Porter, the CEO of Collaborative Robotics, says GC's scale has been a major asset. "What Hemant is really doing is trying to build relationships with the biggest thinkers in the world," Porter said, adding that after the deal closes, he hopes GC will help him sell his robots to Summa Health. "As a founder, that's an amazing set of resources to tap into."
Forbes
27-05-2025
- Business
- Forbes
Forbes Unveils The 2025 Midas List Of The World's Best Venture Capital Investors In 2025
From Left: Mar Hershenson, Hemant Taneja, Larry Li New York, NY – May 27, 2025 – Forbes today unveiled the 2025 Midas List, the definitive ranking of the top 100 venture capital investors in the world. This year's Midas List reflects a cautious market environment, with a small number of major deals and high-performing startups driving major jumps in the ranking. 'This year's Midas List is defined by the mega startups and their investors, who have benefitted from explosions in value over the past 12 months,' said Forbes senior editor, Iain Martin. 'It shows how, in spite of the ongoing IPO and exit draught, the best venture capitalists continue to discover and back startups driving huge growth.' Notable highlights from this year's list include: The Midas List is a metrics-driven ranking of the best venture investors in the world. Forbes recognizes investors whose portfolio companies have gone public, completed an M&A transaction, or raised financing at higher valuations. The list is produced annually using public data and submissions from hundreds of investment partners. To qualify, investors are ranked by companies that have gone public or been acquired for at least $200 million in the past five years, or that have doubled their private valuation to $400 million or more. For the complete ranking, methodology, videos, and more, visit: The Midas List 2025. Forbes Media Contacts Christina Vega Magrini, cmagrini@ Feryal Nawaz, fnawaz@ Europe Media Contacts Charlotte Juckes, — +44 (0) 7500016834 Johanna Pemberton, —+44 (0) 7719 328 221
Forbes
27-05-2025
- Business
- Forbes
This Top VC Wants To Use Main Street America As An AI Lab
Sitting in the offices of General Catalyst, overlooking Oracle Park—where the San Francisco Giants play—and the sweeping bay stretching beyond it, CEO Hemant Taneja explains how his venture capital firm is going to transform how Americans access health care: by buying and running a hospital. Last year, the firm announced its $485 million purchase of Summa Health, an 8,000-employee hospital system based in Akron, Ohio, with the aim of plugging it into Silicon Valley's innovation engine. That means injecting tech and artificial intelligence into almost every step of the health care process, from checkups to insurance. No hospital system was going to do this on its own, so the thinking was simple: 'We have to go buy one and do it ourselves,' Taneja says. 'And live it.' That ballpark view is fitting because Taneja, No. 8 on this year's Midas List, Forbes' annual ranking of America's top venture capitalists, is no stranger to proverbial big swings (even if the India-born Taneja prefers cricket). Buying a hospital is jaw-dropping for a VC. Tech investors preach disruption, but they are deeply conservative when it comes to running their own funds. Little has changed since venture's grandfather, Arthur Rock, started cutting funding checks to the likes of Intel and Apple. Entrepreneurs such as Gordon Moore and Steve Jobs might 'think different,' but Rock himself was a buttoned-down Harvard MBA who started his career on 1950s Wall Street. General Catalyst wants to break that mold. Since 2018, it has morphed from a typical VC partnership to a multi-hyphenate investment house: There's the firm's 'creation' fund, which spins up new AI companies aimed at remaking dusty industries like accounting or customer service. Then there's the General Catalyst Institute, a think tank looking to shape technology policy around the world, and GC Wealth, a white-glove broker meant to woo well-heeled founders away from private banks. That makes Taneja, 50, one of the champions of a new class of venture capitalist. 'Mega funds' are the sometimes-sniffy label for General Catalyst and peers like Andreessen Horowitz, Lightspeed and Thrive Capital, Josh Kushner's outfit. Mana-ging tens of billions of dollars, they are still minnows compared to Blackstone ($1 trillion in assets) and KKR ($660 billion), but Taneja's ambition isn't to be the biggest investor. Instead, he wants General Catalyst to be a 'strategic conglomerate.' Says Neil Sequeira, a former General Catalyst managing director: 'It's an exciting new animal.' Taneja has his critics, too. General Catalyst's industrial-scale investing barely resembles venture capital, some say. Others snipe, discreetly, about General Catalyst's focus shifting from generating returns from financing startups to 'farming fees' from ever-multiplying funds. Taneja's supporters are willing to back his bold vision thanks to a near-15-year winning streak. Since moving to Silicon Valley from Boston in 2011, Taneja has backed payment giant Stripe (last valued at $91 billion), defense startup Anduril (in funding talks at a $28 billion valuation) and a string of health care unicorns like Commure (valued at $6 billion). General Catalyst tapped its backers for $8 billion last year—more than some Midas List veterans have raised in a lifetime, cementing its status as a venture powerhouse. Assets have ballooned to over $36 billion from $3.8 billion just 10 years ago. And the scaling is accelerating: General Catalyst, along with archrival Andreessen Horowitz, claimed around 20 cents of every dollar invested with U.S. VCs last year, according to Pitchbook data. Silicon Valley gossip normally focuses on which startup will go public next, but recently chatter has circulated that General Catalyst itself will have an IPO. Taneja flatly denies the rumors. 'It's not even on the agenda,' he says. 'We've never discussed it.' For a VC firm, Taneja has loads of money on tap, but his grand strategy may require even larger amounts. Blackstone, KKR and Apollo grew more than tenfold after going public as they used their freshly minted shares to fuel growth, fund takeovers and cash out old partners. But there's still a taboo around venture funds going public: Valley graybeards still remember dot-com bomb Internet Capital Group listing on Nasdaq in 1999. The VC shop's valuation ballooned to nearly $60 billion before plunging 99.5% in less than two years. Taneja now rubs shoulders with business leaders, prime ministers and royalty (he cohosts an annual ball at new hire Jeannette zu Fürstenberg's family castle in Germany). It's a long way from the aisles of the suburban Massachusetts CVS where he worked in high school to help his parents make ends meet. When he was 15, his parents moved to Boston from New Delhi. During the recession of the early 1990s, his father wound up managing a KFC. 'I probably ate that almost every day,' he says. 'I can't look at a KFC anymore.' After high school, he landed at MIT. He cofounded and sold a mobile software startup after graduating, landing him on the radar of General Catalyst cofounders Joel Cutler and David Fialkow in 2001. The pair were looking for a founder to kickstart new business ideas. 'He was the full package. We knew early on that Hemant could be a tremendous leader,' Fialkow says. General Catalyst had a handful of early wins like travel booking site Kayak (which went public for $1 billion in 2012), but its East Coast base was away from the entrepreneurial center of Silicon Valley. So in 2011, the firm's founders tapped Taneja, along with a handful of other partners, to build a beachhead in Palo Alto. He had his work cut out for him. Taneja's outsider status was apparent when he was elbowed out of an early Snap investment by Valley vets. His fortunes changed after an early Stripe hire sat in on a guest lecture Taneja gave at MIT and connected him with the startup's cofounder brothers, Patrick and John Collison. He first invested in 2010, then led the startup's Series B two years later. While Stripe's cofounders initially saw the company as a 'little developer-oriented credit card payment thing,' Taneja saw the bigger opportunity in simplifying digital transactions more generally, CEO Patrick Collison says. 'He perceived more in Stripe than we did.' (Taneja got into one of Snap's later rounds, too.) Taneja's new path was set over a bottle of Brunello during a 2017 dinner at Vicolina, a now-shuttered Manhattan trattoria, with Ken Chenault. The former Amex CEO had just been hired as General Catalyst's chairman, partly to help manage the handover from the fund's cofounders to heir apparent Taneja. As they dined, Chenault, who was one of the first Black executives to run an S&P 500 company, leaned across the table and pressed Taneja on what he wanted his impact to be. 'I want to be a leader, not just in business,' Chenault recalls Taneja telling him. To some, General Catalyst's strategy looks like private equity with a coat of shiny AI paint. Taneja took over as CEO in 2021 and began transforming General Catalyst from a clubby partnership into a firm that could address social problems. Goodbye to Mark Zuckerberg's motto of 'move fast and break things.' Hello 'responsible innovation.' It's not as catchy, and it hasn't always earned Taneja a warm reception from some of the Valley's loudest voices and deepest pockets. General Catalyst's advocating for guardrails on new AI systems was met with hoots of disapproval, notably from Andreessen Horowitz billionaire cofounder Marc Andreessen. 'They're very smart, they're very opinionated. All that is positive in my book,' Taneja says of the rival firm. 'They're playing a different game than us.' (Behind closed doors, Andreessen and Taneja played nice when they both sat on the board of now-public freight tracking company Samsara, says CEO Sanjit Biswas.) Guardrails or not, AI is central to the firm's strategy of doing rollup mergers in sectors long considered too stodgy for Silicon Valley, like IT services and human resources. Buyout funds have been doing this for decades, cutting costs by moving jobs offshore. Taneja wants to use AI. Last year, a General Catalyst startup called Crescendo bought PartnerHero, a $80-million-a-year call center company, and automated calls with bots, handing over only tricky cases to human workers. The result is as much as 30% savings for customers, says Crescendo CEO Matt Price. Dwelly, a London-based real estate startup cofounded by General Catalyst, bought a handful of property management companies and added AI tools for managing open houses and maintenance requests. Not only is AI cheaper, but the wait for fixes for leaky taps and other repairs is down 40% to 30 days, says Dwelly CEO Ilia Drozdov. To some, the strategy looks like private equity with a coat of shiny AI paint. Taneja shrugs off the notion, saying that while private equity is more focused on cost-cutting, General Catalyst's rollups are about instilling a culture of 'innovation,' albeit the type that also happens to cut costs. Taneja is the driving force behind these rollups, and he wants General Catalyst to cofound the firms executing them. The lodestar is Livongo, the diabetes management startup he cofounded in 2014. It went public in 2019 for $3.6 billion. That would be a home run for most investors, but Taneja was just warming up. A year later, Livongo was acquired for $18.5 billion by Teladoc, resulting in a paper gain of $3.4 billion for the fund. The outsize return was almost entirely thanks to General Catalyst's large ownership stake (18.3%) as a cofounder. Still, Taneja is treading a difficult path. He needs to overcome local protests against his yet-to-close hospital takeover before turning around the $2 billion (2024 revenue) operation. And while Taneja is a savvy investor, he's by no means infallible. A series of bets on climate startups resulted in a $100 million wipeout, and health insurance claim specialist Olive, once valued at $4 billion, is a total bust. And General Catalyst ended up banking only an estimated $1.8 billion from Livongo, with Teladoc's share price crashing 97% from its peak. But perhaps the biggest risk is that General Catalyst is doing too much. 'I get that question a lot,' Taneja says. He says it's a matter of having 'leadership bandwidth' and a good operating model, comparing the company to Amazon, which expanded from books to data centers to grocery stores to moviemaking. Taneja has stretched himself to the brink in the past. At MIT, his counselor warned the triple major (computer science, biology and math) that he might not finish with such a demanding courseload. He not only graduated but went on to earn master's degrees in engineering and operations research a few years later. It's a pattern he has carried with him throughout life, Taneja says, laughing. 'I'm always trying to do too many things at the same time,' he says. 'I push myself to the max.'
Business Insider
13-05-2025
- Business
- Business Insider
$6 billion Commure was just ordered to stop selling a hot healthtech product in its latest legal challenge
$6 billion healthcare startup Commure has been ordered to stop making one of its most historically successful products in a legal face-off with the tech's creators. Commure, the startup cofounded by General Catalyst CEO Hemant Taneja and incubated by the VC firm, has been embroiled in legal turmoil for over a year with the makers of its former workplace safety tech, Strongline. Canopy Works created the technology behind Strongline, a wearable panic button for hospital staff that was once Commure's best-selling product. Canopy severed its ties with Commure in 2023, after which Commure released an "upgrade" to Strongline called Strongline Pro. Canopy alleged in a lawsuit against Commure in the Northern District of California that Commure's Strongline Pro was a derivative of Canopy's Strongline, which violated the companies' contract. Now, a federal district court has sided with Canopy and ordered Commure to stop selling Strongline Pro. The court's preliminary injunction, filed on April 25 in the Northern District of California and made public Friday afternoon, prohibits Commure from distributing or marketing Strongline Pro to new customers, at least while the underlying breach of contract case proceeds. It's a big win for Canopy, which says it's lost business as hospital customers "upgrade" from Canopy's Strongline to Commure's Strongline Pro. Strongline's business was Commure's sole growing revenue source at the time of its $6 billion merger with fellow General Catalyst portfolio company Athelas, as Business Insider reported in September. It's unclear how much revenue Strongline Pro now contributes to Commure or how much that revenue could be affected by the court order. "This injunction validates the years of dedicated R&D and significant investment Canopy has poured into its unique healthcare safety platform," A Canopy spokesperson said in a statement to BI. "This ruling provides certainty for our customers, confirming they are partnered with the creator of this technology and can trust the integrity and performance of the Canopy system safeguarding their employees." Commure has asked the court to delay the injunction's enforcement. In a statement to BI, Commure SVP and General Manager Dan Warner said he expects the Ninth Circuit Court of Appeals to overturn the injunction, adding that "the law and facts are firmly on Commure's side," and that Commure developed Strongline Pro entirely in-house. For its part, Commure has expanded well beyond its workplace safety product in the past year. The startup has signaled its intentions to dig deeper into healthcare AI following its acquisition of revenue cycle management company Athelas, buying ambient scribing company Augmedix in July 2024 for $139 million in cash, and scooping up another General Catalyst portfolio company, AI-powered care coordination platform Memora Health, in December. General Catalyst is also closing a deal to buy Akron, Ohio-based health system Summa Health. The firm has said it plans to integrate healthcare technology into the hospitals' operations, an endeavor that would likely include Commure's tech. Commure's battle with Canopy Commure and Canopy created their first agreement to make Commure a reseller of Canopy's technology in 2019. In 2022, Commure bought the rights to white-label and sell Strongline's wearable panic buttons for hospital staff. Canopy Works, then known as SMP Labs, remained a separate company and retained ownership of the intellectual property. Tensions quickly escalated after the acquisition. In late 2022, Commure sued Canopy when the company tried to terminate its partnership with Commure. Canopy had cited delayed payments as a reason for breaking away from the startup. That lawsuit was dismissed and later settled, but the damage was done. By December 2023, Canopy spun out for good as a new company to sell its safety technology directly to health systems. Commure moved quickly to rebuild its workplace safety business, launching Strongline Pro just days after Canopy's debut. Commure positioned Strongline Pro as a successor to the original Strongline product, although filings with federal regulators showed substantial similarities between the two devices, per BI's September reporting. Commure holds that "Strongline Pro was developed independently by Commure without using any information from Canopy," per the Friday injunction. After Canopy's exodus, Commure filed a lawsuit against Canopy in April 2024, alleging that Commure had contributed to the development of Strongline's original concept and that Canopy had violated its contractual obligations to provide its tech to Commure through the end of the year. Commure also raised concerns about alleged security vulnerabilities in Canopy's technology. As ordered in the injunction, existing Strongline Pro customers can continue to use Strongline Pro, but Commure cannot upgrade those systems or contract with new Strongline Pro customers. In his statement to BI, Commure's Warner also referenced a prior civil decision in which he said a judge ruled that a Canopy employee, who previously worked at Commure, had misappropriated Commure's confidential information for Canopy's benefit. Warner said the ruling "confirms that Commure, not Canopy, is the party harmed in this dispute." BI could not independently review the filing as it has not been made public. A Canopy spokesperson said in response that the arbitration was a separate issue with one of Commure's former employees that is "completely unrelated to the ongoing litigation with Canopy."
