Bootstrapped since 2006, Outcome Health just became one of the best-funded companies in our tech ecosystem’s history.
The Chicago healthtech company, which helps patients get better by providing actionable health information at the point of care, announced on Wednesday that it has raised its first round of funding ever at a valuation of more than $5 billion pre-money.
With more than 150 open positions and plans to expand its engineering and product teams both at its Chicago headquarters and in New York City, Outcome Health is providing a healthy boost to the Chicago tech ecosystem.
Reports on the exact amount of funding raised by the company vary. Bloomberg and Business Insider are reporting that the company has raised $500 million. According to Crain’s Chicago Business, the company is expecting the deal to close in a few weeks to the tune of $600 million, which aligns with the figure reported by Forbes and Wall Street Journal.
The deal is the second largest round of venture funding for a Chicago-based technology company ever, clocking in above Avant’s $325 million 2015 Series E, but below Groupon’s $950 million 2011 Series D, according to Crunchbase.
Outcome Health’s investors include Goldman Sachs Investment partners, Alphabet’s CapitalG, Leerink Transformation Partners, Pritzker Group Venture Capital and Balyasny Asset Management, as well as a number of health systems and other players in the healthcare industry.
"Outcome Health and its investors share a commitment to activate the best health outcome possible for every person in the world. We believe achieving this at scale will require building a ubiquitous network that brings together all sides of healthcare to support patients and healthcare providers whenever, wherever and however they make critical healthcare decisions," said CEO Rishi Shah in a statement. "We are grateful to have been entrusted to realize this vision by so many important stakeholders. Together, we have the opportunity to create the exam room of the future, physically and digitally, and evolve healthcare decision making from the currency of information to the currency of intelligence."
Formerly known as ContextMedia, Outcome Health was founded in 2006 while Shah and co-founder Shradha Agarwal were students at Northwestern University. The company uses digital technology to streamline communication between doctors and their patients.
Outcome Health’s software is free for healthcare providers and funded by companies like insurance providers and pharmaceutical companies, which receive aggregated anonymized data in return, according to Bloomberg.
That model appears to be working. According to Crain’s, Outcome Health’s annual revenue has doubled for two years in a row, surpassing $130 million last year, and the company is operating with a profit margin of close to 40 percent — all before the company raised a single round of outside funding.
Outcome Health was one of the ecosystem's last bootstrapped titans, following Vivid Seats' first investment early last year.
With its technology currently present in 20 percent of U.S. physician practices, Outcome Health said the funding will help the company reach 70 percent of practices by 2020. The company will also be seeking growth in new sectors of the healthcare industry including pharmacies and clinical trials as well as through international expansion.
This story will be updated.
Image via Outcome Health.