The
digital
health
IPO
market
hasn’t
exactly
been
active
in
recent
years.
There
was
a
surge
in
2021,
when
21
of
the
57
active
public
digital
health
companies
today
made
their
debut
on
the
public
markets,
according
to
Halle
Tecco,
founder
of
Rock
Health,
in
a
blog
post.
Since
then,
only
a
smidgen
of
companies
have
filed,
including
Tempus
AI
and
Waystar.
And
many
of
those
who
have
gone
public
have
largely
stumbled.
Just
recently
it
was
announced
that
Accolade,
which
went
public
in
2020,
is
being
acquired
by
Transcarent
for
$621
million.
The
deal
will
take
the
company
private
again.
Teladoc
Health,
which
went
public
in
2015,
reported
a
$1
billion
loss
in
2024.
Hinge
Health,
meanwhile,
took
a
leap
of
faith
last
week
by
filing
for
an
IPO.
The
San
Francisco-based
company
offers
digital
musculoskeletal
care
for
acute
injury,
chronic
pain
and
post-surgical
rehabilitation.
It
serves
more
than
2,200
employers
and
health
plans.
The
company’s
last
valuation
was
at
$6.2
billion
in
2021
and
it
has
raised
over
$1
billion
to
date.
But
knowing
the
struggles
of
those
that
have
IPO’d
before,
and
the
deep
uncertainty
the
markets
are
currently
embroiled
in,
is
going
public
now
a
wise
move?
One
healthcare
investor,
Michael
Greeley,
cofounder
and
general
partner
of
Flare
Capital
Partners,
is
“cautiously
optimistic”
about
this
move.
He
noted
that
the
financial
profile
of
the
company
is
interesting
with
high
margins
and
high
growth,
not
to
mention
that
Hinge
is
addressing
a
massive
market.
“I
was
really
excited
to
see
that
finally,
the
dam
was
breaking,”
he
said
in
an
interview.
“But
then
you
just
sit
back
and
you
look
at
all
of
what’s
going
on
around
the
sector
and
the
company,
[like]
regulatory
uncertainty.
…
You
just
don’t
want
it
to
go
out
and
be
unsuccessful
and
then
have
people
say,
‘See,
yet
another
digital
health
IPO
kind
of
broke,’
But
I
think
they
have
a
high
quality
asset
here.”
He
added
that
this
is
a
wise
move
as
long
as
it’s
offensive
rather
than
defensive.
“If
it’s
defensive,
where
the
company
is
running
out
of
money
—
and
I
don’t
think
that’s
the
case
—
then
that’s
probably
a
sign
of
desperation,”
he
said.
“But
I
think
this
is
a
company
where
it’s
a
high
quality
company,
well-funded
and
very
profitable.
And
the
underwriters,
the
investment
banks
that
they’re
working
with,
have
said,
‘Yeah,
there’s
a
whole
set
of
public
investors
that
want
to
buy
your
stock
in
an
IPO.
And
so
we’ll
be
successful
in
getting
this
company
public.’”
According
to
Hinge’s
S1,
it
gained
$390
million
in
revenue
in
2024,
and
had
a
33%
revenue
growth
year
over
year.
It
also
had
$49
million
in
operating
cash
flow,
though
it
is
not
currently
profitable
with
a
net
loss
of
$11.9
million
in
2024.
This
is
a
vast
improvement
from
2023,
however,
when
Hinge
had
a
net
loss
of
$108.1
million.
And
research
shows
that
MSK
is
a
massive
market:
it’s
the
second
largest
cost
driver
for
employers
behind
cancer,
the
Business
Group
on
Health
reported
in
2024.
That
said,
the
timing
of
this
filing
doesn’t
entirely
make
sense
to
Christina
Farr,
managing
director
at
consulting
firm
Manatt
Health.
“I
am
very
curious
about
why
now?
Why
this
moment?”
she
said
in
an
interview.
“Because
the
stock
market
is
really
not
in
a
great
place
right
now.
You
can
see
it’s
very
volatile.”
However,
with
so
few
companies
going
public
right
now,
it
allows
there
to
be
a
moment
where
“all
eyes”
are
on
Hinge,
Farr
noted.
She
added
that
there
is
a
lot
to
like
about
Hinge
Health.
“They
do
have
some
impressive
metrics,”
she
said.
“The
growth
has
been
really
strong.
Revenue
is
strong.
They’re
starting
to
expand
into
Medicare,
and
I
think
that’s
a
really
big
opportunity
for
them.
…
They’ve
tended
to
do
very
well
with
employers,
so
there
are
market
expansion
opportunities.
But
let’s
see
how
it
all
goes.
We
just
don’t
know
enough
yet
to
be
able
to
determine
how
this
business
will
be
viewed.”
The
S1
shows
that
Hinge
has
2,250
clients
and
about
20
million
contracted
lives.
In
addition
to
employers,
it
serves
commercial
insurance
health
plans
and
Medicare.
This
compares
to
its
direct
competitor
Sword
Health,
which
has
10
million
lives
and
serves
employers,
commercial
plans
and
Medicare
Advantage,
according
to
its
website.
Several
other
companies
in
the
digital
MSK
space
have
popped
up,
including
Vori
Health
and
RecoveryOne.
Jordan
Cohen,
partner
at
law
firm
Akerman
LLP,
agreed
that
there
is
a
lot
to
like
about
Hinge
Health,
especially
having
been
a
patient
of
Hinge’s
in
the
past
due
to
a
shoulder
injury.
He
noted
that
from
an
employer
perspective,
providing
MSK
support
to
employees
is
important
because
it
makes
the
workforce
healthier
and
more
efficient.
The
company
has
also
recently
entered
into
several
partnerships,
including
with
Amazon
and
menopause
company
Midi
Health.
“It
certainly
doesn’t
seem
reckless.
…
Maybe
they
want
to
capture
the
momentum
now,”
Cohen
said.
The
company
may
run
into
challenges
with
its
valuation,
however,
with
the
last
round
at
$6.2
billion,
according
to
Greeley.
“If
it’s
successful
and
trades
wildly
up
from
the
$6.2
billion,
that
would
be
terrific,
but
there’s
an
equal
chance
that
it’s
going
to
be
priced
lower
than
the
last
round,”
he
said.
“Now
maybe
the
world
has
finally
come
to
realize
that
the
investments
that
were
made
in
2021
and
2022
and
little
bit
in
2023
were
frothy
and
wildly
overvalued.
And
if
it
gets
priced
below
the
last
round,
it’ll
just
confirm
yet
again
that
those
valuations
were
not
appropriate.”
Hinge
Health
declined
to
be
interviewed.
What
does
this
mean
for
the
future
of
digital
health
IPOs?
There
is
a
long
list
of
digital
health
companies
that
the
industry
has
been
eyeing
to
go
public:
Omada
Health,
Maven
Clinic
and
fellow
MSK
provider
Sword
Health
to
name
a
few.
However,
many
companies
may
be
waiting
to
see
how
the
Hinge
Health
IPO
will
shake
out
before
they
make
any
decisions
themselves,
according
to
Farr.
If
this
IPO
is
successful,
Farr
anticipates
that
it
will
kickstart
several
other
companies
filing
to
go
public.
“This
is
sort
of
the
IPO
that
will
define
whether
or
not
any
other
companies
can
go
public
at
this
moment
in
time,”
she
said.
Greeley
echoed
Farr’s
comments,
stating
that
if
the
company
goes
out
at
a
high
price
and
stays
relatively
well
valued,
then
others
may
follow.
It’s
important
to
note
that
neither
Greeley
nor
Farr
have
invested
in
Hinge.
He
added
that
he’s
thrilled
that
someone
finally
started
the
process
of
filing
to
go
public.
“There
are
a
lot
of
us
who
are
sitting
on
large
unrealized
gains,
and
need
to
either
sell
our
companies
or
have
them
go
public
so
we
can
start
to
get
that
capital
back
and
invest
in
new
companies,
new
startups,”
he
said.
“There’s
a
recycling
dynamic
that,
given
the
lack
of
M&A
and
IPO
activity,
it’s
kind
of
stalled.
That’s
why
we’re
all
eager
to
see
some
of
these
get
public
successfully.”
Photo:
jxfzsy,
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