Hinge Health Goes Public, Raising $437M for Investors

Key Concepts:

• Digital musculoskeletal (MSK) care
• Technology-driven healthcare automation
• Physical therapy (PT)
• Market penetration and growth
• Valuation and IPO strategy
• Free cash flow positive
• Operating margin
• Access to care and convenience
• Insurance reimbursement
• Go-to-market motion

Vision and Opportunity:

• Hinge Health's vision is to use technology to scale and automate healthcare delivery.
• The company started with physical therapy, demonstrating the ability to automate approximately 95% of human clinician hours.
• The US physical therapy market is estimated at $50 billion.
• Currently, 20 million Americans have access to Hinge Health, representing about 8% of the 260 million adults in the US, across 2300 customers.

Valuation and IPO:

• Hinge Health achieved a valuation of over $2 billion at its IPO price point.
• The previous private market valuation in October 2021 occurred just before the Nasdaq peak.
• Since then, Hinge Health has:
  • More than quintupled its revenue.
  • Doubled its gross profit.
  • Increased absolute gross profit tenfold.
  • Transitioned from losing $100 million per year to being free cash flow positive for the last four quarters.
  • Achieved a 12% operating margin in Q1.

Addressing Market Needs:

• Approximately 40% of Americans experience a musculoskeletal condition annually.
• Only about 9% of those with MSK conditions seek physical therapy.
• Barriers to accessing traditional physical therapy include:
  • Taking 2-3 days off work each week.
  • Paying co-pays and parking fees.
  • Inconvenience.
• Hinge Health aims to improve access, convenience, and personalization while lowering costs through its technology.

Insurance and Reimbursement:

• Insurance reimbursement is a significant barrier to innovation in healthcare.
• Hinge Health has partnerships with over 50 health plans and pharmacy benefit managers (PBMs), including five of the top five health plans and three leading PBMs.
• These partnerships position Hinge Health as a preferred or exclusive digital MSK provider.
• This simplifies the adoption process for self-insured employers, eliminating the need for individual contracting, IT security assessments, and procurement processes.

Market Penetration and Future Growth:

• 20 million Americans currently have access to Hinge Health.
• There are 120 million Americans who receive healthcare through their employer and over 100 million on fully insured Medicare Advantage or federal plans.
• Hinge Health has a repeatable go-to-market motion for onboarding customers quickly.

Conclusion:

Hinge Health is leveraging technology to transform musculoskeletal care delivery, addressing issues of access, convenience, and cost. The company has demonstrated significant growth and financial improvement, positioning itself for further market penetration and expansion within the employer and insurance sectors.