Olive AI fell off the map yesterday. Today we explore.
Today in health, it a unicorn disappears in health tech. My name is bill Russell. I'm a former CIO for a 16 hospital system. And creator of this week health set of channels and events dedicated to transform healthcare. One connection at a time. We were to thank our show sponsors who are investing in developing the next generation of health leaders. Short test artist, site parlance, certify health. Notable and service.
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All right. Our story for today is another fallen. Unicorn olive AI sells assets to wind down. I'm pulling this from modern healthcare. Of course, that requires a subscription. So I'll give you a little idea of what's in the article. Olive AI, a company that was once a unicorn and valued at $4 billion has sold its remaining assets and is winding down operations. The company which developed technology to help providers and insurers automate. The revenue cycle sold it's patient access software, product away star. And it's prior authorization business.
Health olive said. Tuesday and a post on its website. In terms of the deals were not disclosed representatives from olive way store and you made a, did not immediately respond waste Star's parent company waste our holdings filed a registration statement October 16th, with the sec related to the proposed initial offering, we started has said it will go public as soon as possible. And the deal represents final chapter in what's been a significant fall from grace for olive in December of 2020.
Receive 225 million. From tiger. Global valued at 1.5 billion, seven months later, July of 2021 to receive 400 million and around led by investment firm Vista equity partners that brought its valuation to 4 billion. I'll have AI laid off 450 employees in July of 2022. As CEO, Sean. Lake. Cited strategic missteps and its challenging economy. It cut another 250 jobs in February. And October, 2022, the company sold its population health. And three 40 B product lines to The healthcare artificial intelligence company. So it could focus on revenue cycle management.
It's sold its utilization management solution to Availity in April. Olive is the latest example of digital health unicorn. When investors value companies at more than a billion dollars going bust digital therapeutics company. Paratek therapeutics. Filed in April and Babylon went bankrupt after rose steel to go private fell through. Those are just some of the things that are being said. Here's my, so what on this could be a pretty short episode.
If I thought about it. I, so what on this. Is they got caught in the transition, right? They got caught in a downturn in the economy. They had raised a ton of money. Their evaluation was high. They had a significant portfolio of companies they were doing business with. So it was not like they didn't have clients, they didn't have profitability.
And they got caught at a time when all these organizations were switching to profitability is more important. Then growth and they were a growth company. Everything about them was a growth company. They invested in marketing heavily. They bought a purple bus. They went from health system to health system. And gave out lunches and stuff to employees. They spent a lot of money.
It was the old model of grow at all costs. And you can't just turn that off, especially in something that's. Really mid street at the $4 billion valuation mark. They were actually probably beyond midstream. They were pretty far down the road. And this could have happened to a lot of companies. Now we can argue over the management.
We can argue over the investments and should you have a purple bus? All those things and I'm sure all those things will be talked about. I think those are ancillary conversations. This is what happens when the market shifts on you and your mid cycle. And Some of the organizations that are mid cycle at this point and the market shifts on them. There they're just not going to make it. Period.
There is no getting out of it. Selling off its components for value in order to pay back. Some of their investors is probably their only move at that point. Could olive have been saved. I don't know. I don't know where their product was. I heard some good things. I heard some bad things about their product set. Their data was valuable.
I don't know if their AI was really valuable. It's really hard to say at this point. But I will say that. This is It's just a great example of the organizations that were growing at all costs. Had to shift. And very few of them have been able to make that shift to profitability and had. Most organizations that are raising money today. Have their investors essentially telling them. Profitability.
And so that's the name of the game today. And if we're buying, if I'm talking to healthcare providers right now, if you're out there buying, or if you got caught up in the olive. I Don't know, downturn. If you get caught up in the Alec downturn, the good news is they sold off components of it to other players. And you have some new partners that you have to sit down with and find out how they're going to continue servicing you as a client.
You lost the platform that is olive, but you may have gained a new valuable partner. So that's where you're going to start. But if you are looking at different technologies and startups and those kinds of things and doing those evaluations that we all have to do. The name of the game is profitability.
How close or far are they from it? You have to look at their pipeline. You have to look at them like an investor, because you are an investor. If you're buying their technology, if you're implementing their technology, you are investing in their company and you're placing a trust factor in that company to be around in 10 years.
So it's incumbent upon you to evaluate, will they be around in 10 years? Do they have a pipeline? Do they have a strong value proposition? Do they deliver on their value proposition? And and to the extent that you can help them. To make sure that they around 10 years from now and introduce them to other players and other partners in the industry. I see a lot of CIO is doing that and some people get a little upset with CEO's. They feel like, Hey, they're pushing those companies, but that's part of the job. Part of the job is to make sure that your investments are solid and good investments and the best way to do that as to ensure that they have a future and you can help to make that happen. All right.
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