D2C Telehealth Firm Hims Plans SPAC IPO

Hims, a direct-to-consumer (D2C) company selling health products targeted at millennials, is going public via a special purpose acquisition company (SPAC), CNBC reported.

Hims was started three years ago and is sometimes called Hims & Hers, targeting both men’s and women’s health brands. The company offers products, including birth control, acne treatment and supplements, with several products sold in monthly subscriptions. The company has said around 90 percent of its revenue is recurring, according to CNBC.

The SPAC will be sponsored by investment management firm Oaktree Capital Management. Hims CEO Andrew Dudum said the company had been moving on a very fast track, CNBC reported.

“We’ve taken a roadmap that was two to three years long and compressed it into a few months,” he said, according to CNBC. “We’ve launched a primary care division, at-home COVID-19 saliva test and a mental health platform, which were all things we wanted to do.”

The company is among the several modern ones to offer digital alternatives to brick-and-mortar healthcare services, CNBC reported. Customers are seeking medical services — and almost every other kind of service possible — more often through digital means amid the pandemic.

Through Hims, customers can access virtual doctor’s appointment. After that, according to PYMNTS, they can receive prescriptions through the mail. Mental health and urgent care offerings have also been added recently.

Hims could be valued at $1.6 billion, and the SPAC transaction will likely deliver as much as $280 million in cash, CNBC reported.

Since its formation, Hims has racked up $197 million through investors like Forerunner Ventures, Institutional Venture Partners and others, PYMNTS reported.

A SPAC is a shell company solely set up in order to help another company go public, after which a reverse merger happens with another company. The trend has grown in recent months as companies are looking for quicker ways to go through the initial public offering (IPO) process without filing with the Securities and Exchange Commission.