April 28, 2021: -On Tuesday, Swedish online health start-up Kry said that it’d raised $300 million in big funding round as investors look to capitalize on the pandemic-driven rise in telehealth services.
The CPP Investments and Fidelity investment values the seven-year-old firm at $2 billion. That’s three times the $700 million Kry was worth in a financing round of 2020. Existing investors that include Ontario Teachers’ Pension Plan, Index Ventures, and Accel also backed Kry’s latest competition.
Kry CEO and co-founder Johannes Schildt said the company shipped some latest free products and set up infrastructure for Covid testing at home and vaccines to assist in tackling the pandemic. The firm is loss-making, but it is also prioritizing growth instead of making money in the less term.
“Given the size of the market that we’re in, it makes a lot of sense for us to continue to invest heavily in our product and operations,” Schildt said on Tuesday.
“We monetize both software and health care delivery, but we are continuing to invest at present. And that’s the reason why we raised because we think it makes sense for us to invest in our tools and technology.”
The firm is one of several tech start-ups that have benefited from increasing demand for digital health apps as lockdown restrictions made in-person interactions decreased the possibilities. And investors took note of it.
Last week, French online health insurer Alan announced it had raised 185 million euros at a valuation of 1.4-billion-euro. However, Babylon Health, a U.K based rival to Kry, is exploring a deal to go public via a merger with a particular purpose acquisition company.
Kry and its backers are betting the acceleration of health tech in the previous year is a “mega-trend” that’s expected to stick around long after the pandemic ends. Kry says it has facilitated over 3 million medical consultations since it launched in early 2015, with video appointments more than doubling year-on-year in 2020.
“I think the underlying mega trend of shifting health to digital, that was already there long before the pandemic,” Schildt told CNBC. “A lot of the policy changes we’ve seen across Europe have been in place before the pandemic, but this has accelerated the shift.”
Kry said it would use the new cash to expand its geographic footprint, add mental health services to its platform, grow its team and explore more acquisitions and strategic partnerships.