WELL Health Technologies extends reach into cybersecurity vertical with acquisition of Source 44

Digital health

WELL Health Technologies, a publicly-traded healthtech company headquartered in Vancouver, has acquired cybersecurity company Source 44. The purchase price of the deal is $10.5 million in cash and shares, in addition to a potential performance earn-out of up to $5.25 million.

“WELL is becoming a highly diversified business and we view cybersecurity as a key growth vertical.”

Source 44 is WELL’s second cybersecurity acquisition, with the first being WELL’s purchase of Cycura’s cybersecurity business. With this latest acquisition, WELL Health, which owns primary care clinics across Canada and provides electronic medical records services, is continuing to expand its reach into cybersecurity solutions.

“WELL is becoming a highly diversified business and we view cybersecurity as a key growth vertical for the company going forward and Source 44 accelerates WELL’s overall cybersecurity and risk management program,” said Hamed Shahbazi, the chairman and CEO of WELL.

Based in Markham, Ont. and founded in 2008, Source 44 provides cybersecurity services and related solutions to businesses. Some of these solutions include managed network and vulnerability services, risk assessments, penetration testing and cybersecurity audits. WELL claimed Source 44 generated $20 million in revenues in the last year.

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Following the deal, Source 44 will continue to be operated by founders Peter Giannoulis and Robert Kostecki. Source 44 will work out WELL’s Cycura Data Protection Corp. business unit, which acts as a consolidation point for WELL’s cybersecurity-related assets.

WELL, which is traded on the Toronto Stock Exchange either acquires or takes equity stakes in digital health, billing, and cybersecurity solutions. Some of the company’s notable deals include a $10.75 million acquisition of Kai Innovations, a $5.94 million strategic investment in Insig, and a $1 million seed investment in Phelix.ai.

Digital health has exploded during the COVID-19 pandemic, skyrocketing the need for virtual, contact-free health solutions. Although this has spelled success for a number of startups developing digital health solutions, it has also raised risks to doctor-patient confidentiality and concerns about protecting patient health data.

Source 44 founder Giannoulis claimed that a healthcare organization with a dedicated cybersecurity practice will only benefit the broader healthcare industry moving forward.

Isabelle Kirkwood

Isabelle Kirkwood

Isabelle is a Vancouver-based writer with 5+ years of experience in communications and journalism and a lifelong passion for telling stories. For over two years, she has reported on all sides of the Canadian startup ecosystem, from landmark venture deals to public policy, telling the stories of the founders putting Canadian tech on the map.