This SPAC is betting that a British healthcare company can shake up the US market

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Welcome back to the week, and welcome back to The Exchange. Robinhood has yet to file its IPO, so we’re looking at other companies in the meantime. Today it’s Babylon Health, a British healthtech company that is pursuing a U.S. listing via a blank-check company, or SPAC.

You have questions. I have questions. We’ll get to some answers.

But before we do, we wanted to note that Anna and I are looking into the AI startup market tomorrow morning. If you are a VC with notes regarding the current pace of investment into the sector or thoughts on where customer traction is highest, let us know. If you are a founder building an AI-powered startup, we’d also like to hear from you about what you are seeing. Use the subject line “AI startups,” please.


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With that out of the way, let’s get into Babylon Health. We’ll kick off with a short riff on its fundraising history, talk about its product, and then dive into its numbers and, bracing ourselves for impact, its projections.

The larger context this morning is that we’re doing legwork ahead of what could be a super active Q3 2021 IPO cycle. Kanzhun, a Chinese company, has also filed for a U.S. listing. Toss in Robinhood whenever it gets off its duff and gives us its own filing, and we’re being promised a good time.

Babylon Health

Per Crunchbase data, Babylon has raised north of $600 million as a private company. Its funding, however, has not come from sources that we tend to discuss here at TechCrunch. Instead, the company raised some money from more traditional investors like Hoxton Ventures and Kinnevik, but the bulk of its capital was raised from the Saudi Arabian “Public Investment Fund,” or PIF. The PIF led a $550 million round into the British healthtech company back in August 2019.

PitchBook has the round cut into two parts, the larger, first portion of which valued the company at $1.9 billion on a post-money basis.

That figure brings us to the SPAC deal that Babylon is now pursuing. The company’s new equity value after its SPAC deal will land around $4.2 billion, with Babylon sitting on around $540 million in cash after the deal is completed. The company will sport a lower, $3.6 billion enterprise valuation after its merger with SPAC Alkuri.

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