Florence isn’t wasting any time putting its $20M seed round to good use, picking up asynchronous telehealth platform Zipnosis off of struggling insurtech Bright Health less than two months after closing the funding.
Florence was founded to unlock clinical capacity by giving patients mobile-first experiences that rival consumer industries, allowing them to update their clinical information, fill prescriptions, initiate self-discharge, and book follow-ups. Here’s our full overview.
- Although Florence initially set its sights on the ED, acquiring Zipnosis broadens its product suite with device-agnostic asynchronous telehealth and immediately allows it to accelerate its roadmap to new sites of care – particularly the home.
- The cherry on top of the acquisition is that Zipnosis also brings 50+ health system customers, giving Florence a solid foot in the door to start offering its core ED services.
For its part, Bright Health acquired Zipnosis for roughly $50M just two years ago as it looked to bulk up its capabilities ahead of an IPO that ended up valuing the company at $11.2 billion.
- As with most high-flying public debuts around that time, Bright… struggled to grow into its valuation. The company has since exited ACA exchanges, begun looking to cut its last two MA markets, and overdrawn a $300M+ line of credit.
- That combo forced Bright to offload business lines like Zipnosis to avoid bankruptcy, and although the financial terms of the acquisition weren’t disclosed, Florence’s entire seed round doesn’t seem like it would put much of a dent in Bright’s problems.
All-in-all, this looks like textbook execution by Florence. The company had just 70 employees prior to doubling its head count with Zipnosis team members, and acquiring complementary capabilities and an existing customer base was probably a lot more efficient than building them in-house. It’s also safe to say that Bright isn’t the only distressed business looking to trim units, and it’s likely that we’ll see more stories like this one as strategic acquirers scoop them up.