Coronavirus-related layoffs hit health tech startups

Coronavirus-related layoffs hit health tech startups

Coronavirus-related layoffs hit health tech startups

With the economy in freefall amid the coronavirus pandemic, some health tech startups have started to furlough and lay off workers. The cuts underscore that not even digital health — an industry whose offerings are in high demand during the crisis — is immune to an unprecedented financial meltdown. Diabetes coaching startup Virta Health has laid off some of its employees, primarily from its commercial organization, a company spokesperson confirmed. The company’s website says it has 200 employees, but it’s not clear how many were laid off. The buzzy San Francisco-based company, which uses digital coaching and monitoring to try to help patients reverse type 2 diabetes, was last valued at $538 million, according to PitchBook. A Virta spokesperson attributed the cuts to “the radically changed external economic environment due to Covid-19.” “Even though our recent Series-C funding, rapid growth in our business and virtual care delivery position us well for the future, we believed this change was necessary to ensure we can weather the upcoming economic uncertainty and succeed on our long-term mission,” the spokesperson added. advertisement Halo Neuroscience, a San Francisco-based startup working on brain stimulation technology mostly used by athletes, furloughed most of its roughly 30-person team on March 20, according to a person familiar with the matter. The company had been working to close a funding round, but it was held up due to the pandemic, the person said. The startup is now pivoting from a consumer-focused strategy to focus on more medical applications. Anagram, a Los Angeles-based health-care billing startup, laid off 17 workers this past Friday. “Given the current economic conditions, we had no other choice,” Anagram’s CEO and co-founder, Jeremy Bluvol, wrote on LinkedIn. The company, known until recently as Patch, sells software to medical providers to help with billing insurers for out-of-network care. advertisement Incredible Health, a San Francisco-based startup that runs a hiring platform for nurses, has laid off nine employees, the company’s CEO and co-founder, Iman Abuzeid, confirmed. Most of the staff who were laid off were in sales, marketing, or public relations roles, she said. “We had to pause specific markets, as hospital cancellations of elective procedures have reduced hospital revenue and slowed hiring in those specific markets. We made the difficult decision to reduce the size of our team. This allows us to continue serving our clients in markets that are less impacted by the pandemic, and continue achieving our mission of helping healthcare professionals live better lives,” Abuzeid said in an email. The first layoffs in health tech could be an omen of more negative news to come, if more startups are unable to close funding rounds and bring in enough revenue during the crisis. drag_indicator There’s also potential for the crisis to hit health tech unevenly, if some startups see demand soar for their services and opt to expand hiring
Coronavirus-related layoffs hit health tech startups