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    Kaiser, Mubadala, B Cap may invest $150 million in Innovaccer

    Synopsis

    A formal announcement is due within the fortnight. A small secondary round might also take place along with the primary infusion.

    Invest-iStock
    US hospital and health insurance giant Kaiser Permanente is joining forces with UAE’s Mubadala and B Capital, the investment firm launched by Facebook co-founder Eduardo Saverin and Raj Ganguly, formerly of Bain Capital, to invest $150 million in Innovacer, said people in the know.

    The Series E funding round will nearly treble the valuation of the San Francisco-based pure-play healthcare cloud company to $3 billion, the sources said.

    A formal announcement is due within the fortnight. A small secondary round might also take place along with the primary infusion.

    With this round, the six-year-old Software as a Service (SaaS) startup would have raised a little over $350 million across five financing rounds, similar to heavily funded SaaS peers from India such as Freshworks, Druva, Icertis, Postman and Zenoti.

    When contacted, a spokesperson for Innovacer said: “The company would not be able to comment on this news or confirm anything as of now.”

    Kaiser Permanente, Mubadala and B Capital did respond to ET’s emails till press time.

    Innovacer, founded by Abhinav Shashank and fellow IIT, Kharagpur campus mate Kanav Hasija and former Ingersoll Rand colleague Sandeep Gupta, has been aspiring to be a global healthcare focussed SaaS company entirely on cloud. With seed money from former Google India chief Rajan Anandan and Pravega Ventures, the trio built a horizontal cloud data platform for US healthcare, a $1 trillion opportunity that was ripe for disruption.

    Innovaccer’s cloud platform connects healthcare data culled from various sources, collates them in one place for easy access and then recommends actionable insights, resulting in better outcomes and lower costs.

    The company has set up engineering centres in Noida, Chennai and Bengaluru within a year, as the sector continues to draw big investments.

    In February, the company raised $115 million at a $1.3 billion valuation -- also about a three-times jump from the previous round seven months prior -- from new investors like Omers of Canada as well as existing backers like Tiger Global, Dragoneer, Steadview Capital and Microsoft’s VC fund M12.

    The healthcare cloud computing market has the potential to grow by $33.49 billion during 2021-2025, and the market’s growth momentum will accelerate at a compounded annual growth rate (CAGR) of 23.18%, according to some industry estimates.

    An October study by ResearchAndMarkets.com said revenue of the global healthcare cloud computing market is expected to reach $52.30 billion by 2026, from $11.59 billion in 2020, growing at a CAGR of 28.5% during the period. The Covid-19 pandemic has made the need to digitise records even more important for care givers, insurers as well as patients.

    innovacer

    Innovacer claims its clients, over 50 plus healthcare organisations, reported a $600 million reduction in costs in 2021 alone with 24 million of their patient data digitised and stored on the cloud. Sources in the know said it is expecting $140 million in annual revenues by March 2022. That’s where a Kaiser’s strategic inputs will be valuable.

    “If you bring transformational efficiency in healthcare, imagine the opportunity that lies ahead of us. We are actually not limited by the addressable market. Nobody is thinking of a holistic solution for all the key stakeholders, the doctor and hospital networks, life sciences companies as well as the health insurers,” Shashank, the son of a bureaucrat from Uttar Pradesh, told ET in an earlier interaction.

    The US health-tech market is seeing cloud-based health assurance as a new category, which aims to leverage technology to guide doctors, patients, biotech companies and insurers and minimise health hazards. The key is on user access and adoption, driven by interface design, privacy-aware AI policies and data insights.

    Even in India, the Goa state government worked with the company for a digital health initiative during the Covid-19 induced lockdown last year to help spread information among citizens through a downloadable app, websites and messages.

    In October, HCL Technologies (HCL) and Innovaccer announced a collaboration to help healthcare and life sciences organizations drive digital health transformation.


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