Innovaccer, a digital health unicorn, is laying off 90 employees just nine months after raising $150 million in a Series E funding round.
“Given current economic conditions, we implemented a small workforce reduction to optimize our structure and initiatives. These cuts will help us improve business efficiency and take the right steps toward profitability as we continue our rapid growth.,” Abhinav Shashank, Innovaccer’s CEO said in a statement emailed to Digital Health Business & Technology. “The overall percentage of this reduction was less than 8%."
The layoffs are expected to largely affect the company’s technology workforce.
Innovaccer has raised $375 million in total with a valuation of $3.2 billion. Shashank said in an April interview that the company is working with 60 health systems across the country. His goal over the course of the next year or two is to get to 100-200 health systems, payers and life sciences customers.
“At some point there will be an IPO, probably in the middle of that journey, but we haven't given it like a lot of thought and what the timeline might look like,” Shashank said.
The layoffs come as the industry deals with a broader market correction. Experts say companies need a well-trodden path towards profitability.
“The imperative to grow remains but boards need to evaluate the right balance between growth and profitability. You need to shore up balance sheets when possible,” said Chris Bischoff, managing director at venture capital firm General Catalyst, in an interview with Digital Health Business & Technology.
On Thursday, GoodRx, laid off more than 100 workers or 16% of its workforce. Innovaccer, GoodRx are among the dozens of companies that have cut staff since June.