Definitive Healthcare scoops up analytics startup Populi in $52M cash deal

Healthcare commercial intelligence company Definitive Healthcare bought data analytics startup Populi in a $52 million all-cash deal, the company announced Monday.

Populi, launched in 2020, delivers healthcare commercial intelligence to providers and works with some of the country’s largest health systems, including the University of Pennsylvania Health System and Henry Ford Health.

The acquisition broadens Definitive Healthcare’s suite of healthcare commercial intelligence solutions with new data, analytics and visualization tools tailor-built for the provider market.

The provider-focused data analytics company works with healthcare organizations to optimize physician relationships, reduce network leakage and expand market share. With the deal, Populi brings to Definitive Healthcare a proprietary database of more than 180 billion claims, electronic health record, lab and consumer-level data transactions, according to the company.

“Populi provides the dynamic, highly visual commercial intelligence that healthcare organizations need to grow,” said Robert Musslewhite, CEO of Definitive Healthcare, in a statement. “Our acquisition strategy is to find companies that either provide a new set of proprietary data to enhance our overall offering or provide a new capability to leverage our existing data in new use cases. Populi checks both boxes, and we’re thrilled to have them join the Definitive Healthcare team.”

Populi's provider-centric analytics solutions are "highly strategic additions to the company’s current solution sets," William Blair analyst Jared Haase wrote in a note Monday.

Populi was acquired for $52 million in cash, subject to working capital adjustments, with the potential for additional consideration of up to $28 million contingent upon achievement of certain performance-based milestones in 2024 and 2025, according to the company.

Populi’s product suites include provider intelligence to help organizations assess network integrity, understand patient outmigration and target providers; market intelligence to enable organizations to analyze market size and share and understand patient utilization of services; and population intelligence to help organizations segment and target consumer audiences, build campaigns, match and append patient records and implement digital activation.

“Over the last few years, we focused on building a dynamic, comprehensive solution proven to be incredibly valuable to our provider customers,” said Bill Moschella, CEO and co-founder of Populi, in a statement. “As we looked towards the next phase of our growth, Definitive Healthcare was the perfect company for us to join forces with to bring our healthcare commercial intelligence to more organizations across the care continuum."

Definitive Healthcare went public in September 2021, raising $420 million in its initial public offering and joining a steady stream of health tech companies that hit the public market. The company's valuation was pegged at $3.9 billion.

The company's 2,600 customers include biopharmaceutical and medical device companies, healthcare information technology companies, healthcare providers and other diversified companies in the healthcare ecosystem.

Monday, Definitive Healthcare reported financial results for the second quarter, bringing in $61 million in revenue, up 12% from $54.5 million a year ago. The company reported a net loss of $11.6 million, compared to a loss of $10.1 million in the second quarter of 2022.

The company's adjusted EBITDA was $17.2 million, compared to $16.3 million in the second quarter of 2022.

A week ago, prior to announcing the acquisition, the healthcare data and technology firm completed layoffs of approximately 4% of its workforce, impacting more than 40 employees. This is the second round of layoffs the company has performed in 2023, the Worcester Business Journal reported. The layoffs primarily impacted the commercial and sales teams. The decision came after the company did not reach revenue benchmarks for the first half of the year, the Business Journal reported.

Definitive Healthcare said the acquisition of Populi strengthens its Atlas Dataset with new data assets and additions to claims data, including medical and hospital records along with consumer-level data and social determinants of health.

"With this new data from Populi, multiple departments across an organization can gain even deeper intelligence about their market. For example, a VP of marketing may quickly build a patient cohort analysis to identify all knee replacement patients who recently moved long distance to Massachusetts, while a director of business development may first examine how many patients are leaving their primary service area to go to competitors, then dig deeper to identify specific physicians and individual behaviors that are driving the macro trends," executives said in a press release.

In late June, Definitive also announced a significant expansion of the Atlas Dataset, specifically reference and affiliation data. Definitive increased the number of healthcare executive contacts in its data set by 50% since February 2023.

"The Reference and Affiliation Dataset now contains more than 1.5 million healthcare executive contacts, which we view as a core differentiator of the platform. We remain positive on continued investments in the data platform as a core use of cash going forward," Haase wrote in the analyst note.

Populi has a self-service portal and purpose-built tech stack that includes API and connector technology.