The Wall Street Journal reports that Mountain View, California-based Livongo has enlisted Morgan Stanley, Goldman Sachs Group Inc. and JPMorgan Chase & Co. as underwriters for an IPO that would value the company in excess of $1 billion.
Since 2016, there has been a dearth of digital health IPOs, leading some investors to sound the alarms about a potential bubble in the industry.
But a Wall Street Journal report that chronic disease management company Livongo is planning a public offering in the third quarter of 2019 could change the pattern.
According to the Journal, Mountain View, California-based Livongo has enlisted Morgan Stanley, Goldman Sachs Group Inc. and JPMorgan Chase & Co. as underwriters for an IPO that would value the company in excess of $1 billion.
“We don’t comment publicly on Livingo’s future financing plans,” Livongo spokesman John Hallock said in response to the report.
Livongo was started in 2014 by former Allscripts CEO Glen Tullman who has helped drive the company to $60 million in revenue 2018. Since its founding, the company has raised more than $250 million in funding, including a $105 million Series E round last year which valued the company at more than $800 million.
The Journal reported that Livongo is projected to earn more than $100 million this year in revenue and double that number in 2020.
From its initial focus on diabetes management, Livongo has recently focused on broadening out its platform to areas like diabetes prevention, behavioral health and hypertension through internal technical development and the acquisition of companies like myStrength and Retrofit.
In a recent interview, Livongo CEO Zane Burke said the company will continue this expansion into new markets like COPD, congestive heart failure and musculoskeletal conditions.
MedCity News broached the topic of an IPO earlier this year with Tullman when Livongo brought on board Lee Shapiro as the company’s new chief financial officer, but he largely demurred.
“I think the best companies always develop optionality. Nobody can ever tell you exactly when a company is going public that depends on the markets and a whole host of other things,” Livongo Chairman Glen Tullman said at the time.
“We have optionality, we have plenty of cash in the bank and when both the management team and our board feel like its better for our customers to go public we’ll do so. It’s about being ready for the opportunity.”
Based on the Journal report, it looks as if the opportunity is now.
Date: March 15, 2019