Deal size: $1.6 billion
Announced: Oct. 2
Closed: End of Q4 2020
Why it matters: Digital health company Hims & Hers launched just three years ago and made a name for itself as a men's wellness brand offering skincare, hair-loss products, and erectile dysfunction medication. It has since added a women’s health business, called Hers, and has expanded into treatments for mental health and urgent care.
The upstart has seen rapid success, driving 100%-plus compounded annual revenue growth over the last two years, according to the company. Hims & Hers has conducted more than 2 million telehealth consultations and has about 260,000 subscriptions. The company had $89 million in revenue in 2019, and it said it expects to bring in $138 million in 2020.
The company also reported 91% year-over-year growth during the third quarter of this year.
In October, Hims & Hers announced a merger agreement with special purpose acquisition company (SPAC) Oaktree Acquisition that will enable the company to go public as its experiencing accelerated growth during the telehealth boom.
Private companies will look to merge with a SPAC or blank check company as a nontraditional route to go public rather than a typical initial public offering. With the IPO market rattled by COVID-19 and wild volatility, it has become a more attractive way to go public.
Oaktree Acquisition said the deal "represents a unique opportunity to invest in a rapidly-growing company that is modernizing the delivery and accessibility of healthcare and wellness solutions."
Hims said it plans to use the capital to invest in new product categories, including diabetes, cholesterol, hypertension, sleep, and fertility.