A 10-year-old electronic medical records software company, has confirmed it laid off 25 percent of its staff Wednesday, or 74 people.
The cuts came in areas such as marketing, engineering and customer service, officials confirmed to the Business Times, and were intended to stop the flow of red ink at the digital health pioneer.
“While the layoff yesterday was a difficult decision, these actions were necessary to accelerate our path to profitability and positive cash flow and to remain a leader in the ambulatory electronic health record market,” CEO Tom Langan said in a short statement sent via LinkedIn.
Before the layoffs, it had 300 staffers, marketing executive Rob Purvis said.
Last month, reports emerged that Practice Fusion was looking into a possible 2017 IPO, although the announcement came during a poor-performing January for Wall Street. A public offering by Practice Fusion could attract between $1.1 billion and $1.5 billion, according to an earlier New York Times report, depending in part on the company’s revenues next year, but “the discussions are now in flux because of market volatility.”
Practice Fusion has raised more than $155 million in venture funding over the years, according to Crunchbase’s funding database. Major funders have included Founders Fund, Morgenthaler Ventures, Glynn Capital Management, ARTIS Ventures, Qualcomm Ventures and Longitude Capital.
But it’s been stuck at about 112,000 clinical users, most of them in small medical practices, for several years, according to its public statements.
The company’s longtime CEO and founder, Ryan Howard, stepped out of the chief executive role and took the chairmanship in August. Howard was replaced by Tom Langan, initially as interim CEO and later, in mid-November, as permanent chief executive officer.
Langan joined the company in July 2014 as chief commercial officer.
The decade-old company, a pioneer in the digital health space, was an early mover in the EMR space for small medical practices, providing free EMR services to physicians and other clinicians, with revenue generated through ads and sponsorships.
Langan told me Practice Fusion has experienced 76 percent “year-over-year” revenue growth, Practice Fusion has yet to share any specific details about its financial results.
It did add 5,000 new medical practices to its roster of users last year, Langan said.
Date: February 4, 2016
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