Innovaccer blazes into unicorn club after valuation trebles in 7 months

Bengaluru/Mumbai: In Silicon Valley’s treadmill of vaulted ambitions, venture capital and valuations, a company founded by a duo from IIT Kharagpur and an old colleague is blazing into the buzzy billion-dollar unicorn club – arguably the first pure-play healthcare cloud company to do so.

As Software as a Service (SaaS) companies take the global centre stage, Innovaccer – based in San Francisco with engineering centres in Noida, Chennai and Bengaluru — has just raised $115 million in Series D funding at a valuation of $1.3 billion.

The money has come from new investors, Omers of Canada and McKinsey partner Ajay Gupta, along with existing ones Tiger Global, B Capital, the investment arm of BCG, Dragoneer, Steadview Capital and Microsoft’s VC fund M12.

Its valuation has jumped almost three times from its earlier round just seven months ago.


So far, the six-year-old startup has raised $225 million across four financing rounds, and has become the latest to join the elite unicorn club of Indian SaaS startups, which include Freshworks, Druva, Icertis, Postman and Zenoti.
“Our ambition is to be a global healthcare focussed SaaS company on the cloud,” said Abhinav Shashank, the cofounder and CEO of the company, from San Francisco.

In simple terms, the company’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.

According to the company, its clients reported a $1 billion reduction in costs in 2020 alone.

“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, said.

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After engineering, Shankar teamed up with IIT campus mates Kanav Hasija and former Ingersoll Rand colleague Sandeep Gupta in Boston to create a collaborative data platform for B-School students at Harvard and Wharton.

With 65 of the top 100 universities signing up, that’s when the Eureka moment struck – if all the data collected from diverse sources gets linked up through a common cloud architecture, then “innovation” as Shashank puts it “can get accelerated.”

After all, from Amazon to Facebook, all successful tech companies were harnessing data as a key thematic to bolster their R&D and product pipelines.


With seed money from former Google India chief Rajan Anandan and others, the trio built a horizontal cloud data platform for US healthcare, a $1 trillion opportunity that was ripe for disruption.

“Healthcare is due for a digital transformation the way banking, retail was a few years ago,” said Vinay Menon, managing partner, Pravega Ventures, one of Innovaccer’s earliest backers. “Early on, around 2015-16, they pivoted towards healthcare for a deeper, specialised impact. So, the need was to build an eco-system that is currently growing 100% y-o-y.”

Having mined the entire health data from various silos, the company is stitching everything together using a cloud platform that will also provide a base on which new digital services and solutions can be built with native interoperability, Menon explained. The latest funding will help it launch the cloud platform.

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.

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“They stand to become a meaningful beneficiary of the generational architectural shift taking place in healthcare information technology,” said John Curtius, partner, Tiger Global. The company is confident of $100 million in annualised revenue over the next 12 months.

It is not just in the United States, but even a state government in India (Goa) has worked with the company for a digital health initiative during Covid-19 induced lockdown last year to help spread information among citizens through a downloadable app, websites and messages.

Innovaccer’s entry into the unicorn club comes at a time when Indian software products companies have found a foothold in global markets, drawing a rush of investors to back them, sending valuations soaring.

According to Bain & Company, revenues of Indian-origin SaaS companies are expected to touch $18-$20 billion by 2022, accounting for 7-9% of the global market.

Yet, others have pointed to challenges the sector will face as investors are persuading a lot of companies to incorporate in the United States or Singapore due to the restrictive nature of some of India’s regulations.



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