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GoHealth<\/a>, a Chicago-based company that provides consumers with a digital portal to help them select insurance products, set an initial price range for its IPO today<\/a>. The firm intends to price its equity between $18 to $20 per share in its debut.<\/p>\n As the company expects to sell 39.5 million shares in the offering, its IPO haul is huge. At the low-end of its range, GoHealth <\/a> would raise $711 million, a figure that rises to $790 million at other end of its pricing spectrum. Including the 5.925 million shares the company will offer its underwriting team, its fundraise swells to between $817.65 million and $908.5 million.<\/p>\n Valuing the company at its IPO price range is a bit tough, as the firm was previously majority-sold to a buyout firm called Centerbridge in a deal that valued the firm at what Reuters reported<\/a> as a $1.5 billion price-tag in 2019 (others confirmed the price<\/a>). That transaction turned the company’s organization, and shareholding structure, into a muddle.<\/p>\n https:\/\/techcrunch.com\/2020\/06\/24\/unpacking-the-ncino-and-gohealth-ipo-filings\/<\/a><\/p>\n Parts of its shareholding structure are simple. The firm’s Class A shares, for example, at the top end of its IPO price, are worth around $1.7 billion, including equity offered to underwriters. So, regardless of what happens with its other interests and shares, the IPO looks set to be a win for Centerbridge.<\/p>\n Next, there are several hundred million Class B shares that come with votes, but no “economic interest in GoHealth, Inc.” And, finally, there are LLC interests<\/a> in the company, which correspond with Class B shares. Holders of LLC interests can swap them for “newly-issued shares of our Class A common stock on a one-for-one” when they’d like.<\/p>\n So, how does that all square out? When we properly count all the shares for the firm and apply its IPO price range, GoHealth could be worth between $5.6 billion and $6.3 billion, figures that we are glad other publications arrived at as well<\/a>.<\/p>\n That’s a big price tag, but one befitting a company looking to raise $711 million to $908.5 million in its public debut.<\/p>\n In Q1 2020, GoHealth posted $141.0 million in revenue, and net income of $1.4 million. Not a fat profit margin to be sure, but it did make money in the period, which is always popular, if out-of-date in today’s IPO market<\/a>.<\/p>\n The company has grown nicely in recent years, with its S-1 filing touting 139% “pro forma growth” from 2018 to 2019. That’s great, given that GoHealth has at least some history of making money as well.<\/p>\n Turning to the most recent quarter, however, we find some red ink. In the quarter ending June 30, 2020:<\/p>\n How investors will parse all that out and place a proper valuation on the firm is their job; have fun, ya’ll.<\/p>\n Sure, GoHealth raised capital while it was a private company<\/a>, and, sure, its business is digital. But it’s not really<\/em> the core substance of TechCrunch’s coverage, namely startups. The company is around 19 years old, for heaven’s sake.<\/p>\n But what matters for our purposes is that earlier this year there was a boom in insurance marketplaces raising capital, leading TechCrunch to write a piece entitled “Why VCs are dumping money into insurance marketplaces<\/a>.” GoHealth is a related entity to those younger companies. If it has a good IPO, that’s good for its smaller brethren. If it struggles, or only attracts a slim, unattractive multiple, it could partially chill the fundraising climate for companies looking to follow in its footsteps.<\/p>\n<\/li>\n<\/ul>\n Tags:<\/b> Alex Wilhelm<\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"A financial reminder<\/h2>\n
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What about startups?<\/h2>\n
See Campaign: <\/strong>https:\/\/www.gohealth.com\/<\/a>
Contact Information:<\/b>
Alex Wilhelm<\/p>\n
<\/a>, Wire<\/a>, United States<\/a>, English<\/a><\/p>\n<\/div>\n
\nContact Information:<\/h3>\n
GoHealth, a Chicago-based company that provides consumers with a digital portal to help them select insurance products, set an initial price range for its IPO today. The firm intends to price its equity between $18 to $20 per share in its debut. As the company expects to sell 39.5 million shares in the offering, its IPO … Continue reading GoHealth eyes multibillion-dollar valuation as it sets its initial IPO price range<\/span><\/a> Continue Reading