Castlight Health, a California-based healthcare software developer which counts academic medical centre Cleveland Clinic among its investors, has raised $177.6m from its initial public offering.
Castlight initially sold 11.1 million shares priced at $16.00 each, and after the underwriters took up an option to buy an additional 1.66 million shares the overall proceeds were boosted to $204.24m.
Cleveland Clinic invested in Castlight’s $60 million series C round in 2010, but is not one of the company’s major shareholders. Castlight subsequently raised a $100m series D round in May 2012, and has secured about $178 million in funding since it was formed in 2008.
Venture capital firm Venrock is Castlight’s largest shareholder, owning 20.6%, while other notable investors are VC firm Oak Investment Partners, hedge fund sponsor Maverick Capital, financial services firm Fidelity Investments and UK-based medical charitable foundation Wellcome Trust. Other backers include investment firm T.Rowe Price, VC firm U.S. Venture Partners, financial advisory firm Redmile Group and financial services firm Morgan Stanley.
Goldman, Sachs & Co. and Morgan Stanley & Co. served as joint book-running managers for the IPO, while Allen & Company, Stifel, Nicolaus & Company, Canaccord Genuity and Raymond James & Associates acted as co-managers.
Castlight provides a cloud-based software service that compiles and compares information on the relative price and quality of employee healthcare plans for corporate customers.
The company generated less than $13 million in revenue in 2013 and made a net loss of $62.2 million, a large increase on the $35 million loss recorded in 2012, but this has not dissuaded investors. Castlight opened at $40.00 on Friday, a 150% increase on the offering price, and is trading at $37.66 at time of writing.