Hinge Health prices IPO at $32, the top end of expected range

Hinge Health set the IPO price at $32 per share, hitting the high end of expectations. The startup, specializing in digital physical therapy, sold 8.52 million shares, raising around $273 million. The offering included a total of 13.7 million shares, with existing shareholders selling the remainder. Hinge, established in 2014, will be listed on the New York Stock Exchange under the symbol “HNGE.” The company, which initially filed its prospectus in March, revised it this month, forecasting a price range of $28 to $32.

At the IPO price, Hinge Health is valued at about $2.6 billion, potentially even higher on a fully diluted basis. This is a significant drop from its previous private market valuation of $6.2 billion in October 2021 when it last secured external funding. The company offers software solutions for treating various physical conditions remotely, such as musculoskeletal injuries, chronic pain, and post-surgery recovery. CEO Daniel Perez and Executive Chairman Gabriel Mecklenburg, who both faced personal rehabilitation challenges, co-founded the company.

In the first quarter, revenue surged by 50% to $123.8 million, compared to $82.7 million a year earlier. Hinge Health reported a net income of $17.1 million for the period, a turnaround from a net loss of $26.5 million in the same quarter last year. The digital health sector, which has seen limited public offerings since 2021, will closely monitor Hinge’s IPO. This sector has faced difficulties in recent years due to challenges in recovering from the post-Covid slowdown.

While tech IPOs have been scarce recently, there are indications of increased activity. For instance, eToro, a stock brokerage platform, saw a strong market debut, while CoreWeave, an artificial intelligence infrastructure provider, reported a 420% revenue growth, surpassing expectations and driving a 56% surge in its stock last week. Hinge Health has secured over $1 billion from investors like Tiger Global Management and Coatue Management. In a letter to investors in March, Perez expressed a long-term vision for the company, stating, “We have many decades of work ahead. We hope you join us on this journey.”