(98point6 Image)

Healthcare company 98point6 is selling a portion of its business to San Francisco-based startup Transcarent for $100 million in cash and equity.

The deal will include the virtual care platform and primary care business of Seattle-based 98point6, which provides care in all 50 states. The transaction is expected to close March 31.

98point6 connects users in real-time to its doctors alongside an AI-powered chatbot, texts, and digital images. Its customers include corporations such as Boeing, as well as health plans and health systems. It also goes direct-to-consumer.

98point6 will relaunch as 98point6 Technologies, a software-only company focused on licensing its tech to third-party healthcare providers.

The deal marks the latest chapter in a startup journey that began in 2015 and included nearly $300 million of venture capital raised; rapid growth during the pandemic; an abrupt leadership change in 2021; and layoffs.

98point6 CEO Jay Burrell. (98point6 Photo)

About half of 98point6’s 300 employees, including doctors and clinical support staff, are moving to Transcarent as part of the acquisition, according to a 98point6 spokesperson.

“By combining the 98point6 AI-powered virtual care technology and an affiliated group of world class physicians with Transcarent’s comprehensive care platform, we will deliver consumers and employers what they really want and need,” said Transcendent CEO Glen Tullman in a statement.

Founded in 2020, Transcarent focuses on providing services to self-insured employers and offers virtual access to physicians through its app. Transcarent previously used third-party contractors for care.

The company landed a $200 million Series C round in January 2022, which brought its valuation to $1.62 billion.

Tullman previously took three other healthcare companies public as CEO: Enterprise Systems, Allscripts and Livongo.

98point6 is led by Jay Burrell, who was promoted from chief commercial officer in February 2022. He replaced Jeff Greenstein, the company’s chairman who took over interim leadership duties following the departure of former CEO and co-founder Robbie Cape in August 2021.

98point6’s investors include private equity giant L Catterton; late-stage investment firm Activant Capital; Goldman Sachs; and others.

The company landed a $20 million convertible note in September and announced a deal with Tacoma, Wash.-based MultiCare Health System, the company’s first foray as a third-party software provider. It also laid off 10% of its staff in July.

98point6 ranks No. 32 on the GeekWire 200, our list of privately held Pacific Northwest startups.

“We remain committed to innovating new technology solutions and business models that work upstream to give health care providers the infrastructure they need to succeed with consumers,” Burrell said in a statement.

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