Shaken and stirred
Olive, an enterprise AI suite for health systems, announced last week that it was shutting down operations and selling off its assets. The startup was one of digital health’s largest unicorns, raising over $800M in venture funding and touting a valuation of $4B at its peak.
Olive’s unfortunate closure reflects several trends we’ve been reporting the past few quarters. Like some other highly-valued digital health businesses, Olive’s self-described “fast-paced growth and lack of focus” in 2021 led to bloated operations and cash constraints, triggering layoffs and asset sales. Operational challenges of a company stretched thin across multiple focus areas led to client losses and the eventual closure of the business. Now, Olive is being sold for parts to revenue cycle management player Waystar and to Humata Health, a new startup led by Olive's former president (who seems to be taking a page from the former Pear Therapeutics CEO's book).
It’s never easy to shut down a business, and Olive’s team will be remembered for drawing attention to digital transformation possibilities in healthcare’s nonclinical workflows. We might look back on Olive’s closure as the nightcap of digital health’s first unicorn era. Investors are setting their sights on strong horses with sustainable operations and cash management instead.
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