Health tech company Accolade files for $100M IPO, shows revenue of $95M and loss of $57M

Rajeev Singh
Accolade CEO Raj Singh. (GeekWire File Photo)

Accolade, the Seattle-based health benefits platform led by former Concur president Raj Singh, filed Friday to raise as much as $100 million in an initial public offering.

Here are some of the highlights from its S-1 registration statement, revealing many of its key business details for the first time publicly.

  • Accolade disclosed revenue of $94.8 million for its most recent fiscal year, ending in February 2019, an increase of 23 percent over the prior year, with a net loss of $56.5 million. Its revenue is up more than 47 percent so far this year: $88.1 million for the nine months ended in November 2019, with a net loss of $49.2 million for the same period.
  • The company says it has 53 corporate customers, giving it 1.5 million members, across industries including media, technology, financial services, transportation, energy, and retail.
  • Risk factors listed in Accolade’s IPO filing include its reliance on “a limited number of customers” for a significant portion of our revenue. The filing notes that its largest customers, Comcast Cable, Lowe’s and United Airlines, together accounted for 60% of its revenue for its 2019 fiscal year. Comcast alone represented 35% of its revenue for year.
  • Accolade says its headcount has grown from 756 people as of Nov. 30, 2016, to 1,174 as of Nov. 30, 2019. Most of its employees have been with the company for fewer than three years due to its rapid growth.

Accolade notes that the price of the offering and number of shares to be offered have yet to be determined, and says the $100 million maximum aggregate offering price cited in the filing is solely for the purpose of calculating the registration fee.

According to an Accolade news release, Goldman Sachs, Morgan Stanley, and BofA Securities are lead bookrunning managers for the IPO. Credit Suisse, Piper Sandler, and William Blair are bookrunning managers. Baird and SVB Leerink are co-managers.

The company, which splits its headquarters between Seattle and Philadelphia, helps employees at its client companies navigate their health benefits. Accolade uses a range of technologies, from machine learning to mobile apps, to make it easier for employees to access care. Employers are charged a subscription fee based on the total number of employees.

Accolade has raised more than $230 million to date, with a valuation around $620 million, according to PitchBook. Investors include Andreessen Horowitz, Carrick Capital Partners, Madrona Venture Group and McKesson Ventures, among others. It’s one of a growing number of healthcare technology companies based in the Seattle region.

Singh previously co-founded travel expense software giant Concur and brought on fellow Concur co-founder Mike Hilton as chief product officer at Accolade.

In October, Accolade landed a $20 million investment from health insurance giant Humana as part of an ongoing partnership between the two companies.

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