Accolade sets terms for IPO, aims to raise up to $211M in Seattle’s first public offering this year

Accolade CEO Raj Singh speaking at the 2018 GeekWire Summit. (GeekWire Photo / Dan DeLong)

Accolade set the terms for its IPO on Wednesday as the health benefits platform aims to become the first Seattle-area company to go public in 2020.

The startup will price 8.75 million shares at between $19 and $21, raising as much as $211 million and valuing the company at around $1 billion. It plans to trade on the Nasdaq exchange under the ticker ACCD.

The company’s latest S-1 registration filing shows a $51.3 million net loss and $132.5 million in revenue for its fiscal year ending Feb. 29. That’s compared to a $56.5 million net loss and $94.8 million in revenue the year prior.

Accolade, which splits its headquarters between Seattle and Philadelphia, helps employees at its client companies navigate their health benefits. It uses a range of technologies, from machine learning to mobile apps, to make it easier for employees to access care. Employers are charged a subscription fee based on the total number of employees.

“The U.S. healthcare system is complex and places significant strain on consumers, who struggle to effectively use their healthcare and benefits, make informed decisions about their health, and navigate the fragmented network of providers and third-party benefit programs,” the company says in the filing. “The recent onset of the COVID-19 global pandemic has only served to further exacerbate the complexity and frustration faced by consumers, as they seek information about the availability and accuracy of virus and antibody testing or face limits on their ability to access traditional care safely.”

Accolade estimates its total addressable market to be approximately $24 billion.

The company says it has 58 corporate customers, giving it 1.6 million members across industries including media, technology, financial services, transportation, energy, and retail. Its customer base has remained steady amid the COVID-19 crisis and the company added the Defense Health Agency as a client last month.

Accolade has raised more than $230 million. Accretive has the largest stake at 26.9%, followed by Andreessen Horowitz at 16.2%, Carrick Capital at 9.9%, and Comcast Ventures at 6.9%. Accolade CEO Rajeev Singh owns a 6.4% stake.

Accolade says its headcount has grown from 759 people as of Feb. 28, 2017 to about 1,250 as of Feb. 29 of this year. Most of its employees have been with the company for fewer than three years due to its rapid growth.

Singh previously co-founded travel expense software giant Concur and brought on fellow Concur co-founder Mike Hilton as chief product officer at Accolade, which originally launched back in 2007.

Accolade would be the first Seattle-area company to go public since Adaptive Biotechnologies last year. Several tech firms are going public despite the ongoing pandemic. Vancouver, Wash.-based marketing software startup ZoomInfo priced above its range earlier this month and saw shares spike 62% on its first day of trading.

Accolade is ranked No. 7 on the GeekWire 200 list of top Pacific Northwest startups. The company previously said in February it would raise as much as $100 million.

Here’s a look at the company’s financials (click to enlarge):

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