Kinnevik Results Presentation Deck
Intro
Net Asset Value
VIRTUAL CARE
Our Virtual Care businesses deliver specialized care services through
virtual channels, and leverage technology such as Al to improve the
care outcomes for their users. Our previous investee company Livongo
pioneered the model, and our current investee companies are disrupting
the virtual care incumbents such as Teladoc (TDOC) and Amwell (AMWL).
Our businesses are selling to employers and insurers and have a high
share of recurring revenues, but as healthcare companies they require
higher costs for servicing the end-user of their products than business
software may do. The appropriate public market benchmark for valuing
our virtual care businesses is therefore high-growth SaaS businesses and
healthcare technology businesses that share our investments' structurally
lower gross margins in the 50-60 percent area.
In the first quarter, we led a USD 71m funding round in Spring Health
with a 40m investment at a 2.5bn post-money valuation. The balance of
the round was funded by other existing investors, and we also invested an
additional USD 10m into secondary equity. Raising capital from existing
investors allowed Spring Health to remain focused on continuing to deliver
on expectations rather than on catering to an unacquainted investor's
diligence requests, and allowed us to accrete ownership in one of our
strongest-performing businesses in our portfolio at a balanced valuation.
The fair value of our aggregate investment largely corresponds to the
valuation that the company was ascribed in the funding round. Spring
Health has grown its revenues since our late 2021 investment by more
than 4x on an NTM basis and 7x on an LTM basis. Meanwhile, during
the same period our NTM revenue multiple has contracted by almost
70 percent. Through the recent funding round, we believe the business is
funded to break-even and on track to reach cash flow profitability in 2024.
One of our more early-stage virtual care businesses Parsley Health
also raised new capital in the quarter in a funding round led by
7wire Ventures - a US healthcare investment firm founded by the founders
of Livongo. We participated in the round with a USD 10m investment,
and our assessed fair value is at a slight discount to the valuation that
the funding round was concluded at.
KINNEVIK
Interim Report Q1 2023
Portfolio Overview
Virtual Care
Revenue Growth (2022)
Gross Margin (2022)
EV/NTM R
EV/NTM R (Q/Q Change)
Equity Value (Q/Q Change)
Note:
16x
12x
8x
Sustainability
4x
Our
Investees
221%
48%
EV/NTM Revenue and Revenue Growth
Key Public Benchmarks as at Quarter-End
9.6x
+9%
+25%
10%
Peer
Average
26%
63%
6.0x
+11%
+20%
"Peer Top Quartile" data points are the average metrics of the top quartile peers in terms of revenue multiple
Peer Top
Quartile
23%
20%
82%
10.6x
+3%
+5%
• SaaS Universe
Financial Statements
8%
+13%
30%
• Healthcare Technology
Other
Unlisted Portfolio Weight
Fair Value Change (Q/Q)
A
40%
50%
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