TechCrunch Startup News Hinge Health pops 17%, but joins growing ranks of down round IPOs
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May 26, 2025 Hinge Health's successful IPO saw a 17% surge, showcasing its resilience in a shifting market. Despite lower valuations than in previous funding rounds, the company has carved a niche in digital physical therapy. The discussion dives into the rise of down-round IPOs and challenges in the digital health space. Comparisons with competitors highlight Hinge Health's innovative approach to tackling musculoskeletal pain. It's a fascinating look at how startups adapt and thrive amid changing investment landscapes.
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Valuation Drop in IPOs
- Hinge Health's IPO first-day price was 17% higher than its IPO price, but the valuation is less than half its last private valuation.
- The public market often values companies lower than their peak private market valuation from the 2020-2021 era.
Down-Round IPOs Are More Accepted
- The stigma of down-round IPOs has decreased greatly after the 2020-2021 valuation boom.
- Companies like Reddit and Service Titan have gone public well below their last private valuations but still proceeded with IPOs.
Hinge Health's Ownership and Funding
- Hinge Health raised $437 million in its IPO, with proceeds split between the company and existing investors.
- Major shareholders include Insight Partners, Atomico, and the co-founders who retain significant ownership stakes.