Congratulations Livongo, a True Company of Consequence
We’re thrilled about Livongo achieving their latest milestone of going public! After such an accomplishment, it’s always fun and important to look back at the journey because after all, often it is the journey, not only the result, that is most fulfilling.
Sapphire Ventures first invested in Livongo in 2016, and as our first true health-tech investment, it wasn’t easy. For one thing, we canvassed the digital health (and specifically the diabetes management space) for months, and while there were clearly lots of good intentions, there weren’t that many good businesses.
Let’s face it: it’s tough to sell healthcare solutions. Where there are 1-2 critical decision-makers in an enterprise technology sale, there are at least twice as many in a health-tech sale and you have the added complexity of heightened regulations, patient confidentiality and more.
But it was clear Glen Tullman (then CEO, now executive chairman) and team were not only looking to do good, (Livongo, as the name suggests, keeps people “living and on the go”) but they were providing a solution that customers were willing to pay for.
As growth-stage investors we always go deep on sales-motion repeatability/efficiency and retention/expansion metrics, and that’s where Livongo was really performing. Efficiency and existing customer retention/growth are extremely important to us because they are incredibly strong growth levers. When we talk about working with “Companies of Consequence” we mean companies that not only do things which have an impact, but also have the ability to operate at very large scale – and the early data around true sales traction was like nothing else we’d seen in healthcare.
Our investment thesis was underpinned by their sales traction, but also by:
- Glen and the team around him;
- The disruptiveness of business model (not charging for strips, B2B2C, highly scalable recurring revenue, strong early traction with hugely influential partners);
- he packaged software and service solution (driving real health outcomes, focus on consumer experience, personalized recommendations driven by data science) they provided;
- Glen’s vision of building a chronic-condition management platform that would encompass far more than diabetes – an ambitious enough challenge – and focus on best-in-class enterprise selling with an unparalleled consumer experience.
Today, we find ourselves partnered with a Livongo team who is tackling not only diabetes, but also hypertension and mental health conditions, with a demonstrated skill set of developing solutions for other conditions. The opportunity ahead of Livongo is incredibly large, and more importantly, the impact the company is having – helping people with chronic conditions live their best / most full lives -- is truly consequential.
At Sapphire, our mantra is to partner with, and help build the companies we invest in. We’re fortunate to have been involved with and helped Livongo.
Cheers to the Livongo team and onwards and upwards!
Disclaimer: Nothing presented within this article is intended to constitute investment advice, and under no circumstances should any information provided herein be used or considered as an offer to sell or a solicitation of an offer to buy an interest in any investment fund managed by Sapphire Ventures. Information provided reflects Sapphire Ventures’ views as of a time, whereby such views are subject to change at any point and Sapphire Ventures shall not be obligated to provide notice of any change. Companies mentioned in this article are a representative sample of portfolio companies in which Sapphire Ventures has invested in which the author believes such companies fit the objective criteria stated in commentary, which do not reflect all investments made by Sapphire. A complete alphabetical list of Sapphire’s investments made by its direct growth investing funds is available here. No assumptions should be made that investments listed above were or will be profitable. Due to various risks and uncertainties, actual events, results or the actual experience may differ materially from those reflected or contemplated in these statements. Nothing contained in this article may be relied upon as a guarantee or assurance as to the future success of any particular company. Past performance is not indicative of future results.