Healthcare Giant Kaiser Permanente to Invest $250 Million in Innovaccer

Leading US health giant spearheads $250 million infusion into innovative healthcare technology firm, paving the way for a new era of patient-centric care.

In a significant move signaling continued interest in the healthcare technology sector, US health and insurance giant Kaiser Permanente is reportedly in advanced discussions to lead a substantial investment round in Innovaccer, a leading healthcare-focused software-as-a-service (SaaS) firm. According to sources familiar with the matter, the investment is expected to range between $200 million to $250 million and will involve both primary and secondary funding.

The investment, which comes amidst a backdrop of shifting valuations in the SaaS industry, is poised to place Innovaccer at a valuation of approximately $2.5 billion, marking a slight decrease from its peak valuation of $3.2 billion in December 2021. This move reflects a broader trend of valuation multiples in annualized recurring revenue dropping across SaaS companies globally, with multiples currently ranging between 10-15x compared to record highs of up to 30x in 2021.

Despite the potential slight dip in valuation, the investment underscores Kaiser Permanente's confidence in Innovaccer's capabilities, as it is reportedly also a customer of Innovaccer's services. Alongside Kaiser Permanente, UAE's Mubadala Capital, an existing investor, is expected to participate in the new funding round.

The potential investment from Kaiser Permanente comes shortly after the announcement of a partnership between the two entities, highlighting Kaiser's commitment to leveraging Innovaccer's technology to enhance its service offerings based on aggregated patient data. With notable clients such as Orlando Health, MercyOne, and CommonSpirit Health, Innovaccer continues to solidify its position as a leader in the healthcare technology landscape.