Digital health chatbot Babylon announced its plans to go public via a $4.2 billion SPAC merger with Alkuri Global Acquisition.

The combined entity will operate as Babylon (BBLN) on Nasdaq. According to the company, the deal is expected to close in the second half of 2021. Leading up to going public the company announced its revenue had multiplied by five in 2020.

Founded in 2013, the company got its start as a symptom-triage checker, but has quickly expanded. The company has expanded into hybrid care with its NHS-backed service GP at Hand, which allows patients in the U.K. to sign up for the service in lieu of registering with their local general practitioner. The service includes digital triage, online video visits and in-person care centers.

Today the company is selling two main products.

Babylon 360 lets patients check their symptoms, book an appointment and develop personal healthcare goals. Patients using this tool are able to choose their primary care provider, create a personalized plan and manage any chronic diseases.

Babylon's other main product is called Babylon Cloud Services, which is made up of digital self-care tools.

WHY IT MATTERS

The digital health space is abuzz with SPACs. According to a Rock Health report, more than 80% of public digital health exists in 2020 have been done through SPAC mergers.

Rock Health research found that companies going public via a SPAC, on average are younger and less funded than those who have gone public through an IPO. However, it is important to note that Babylon is a particularly well-funded digital health company and has been in the space for some time.

THE LARGER TREND

In 2019, Babylon scored a $550 million Series C round led by the Saudi Arabian crown prince. This infusion of cash boosted the company's valuation to more than $2 billion. At the time the company said the funds would fuel expansion into North America, the Middle East and China.

The very next year the company raised an additional $100 million in a convertible loan led by Swedish-listed fund VNV Global.

While the company got its start in the U.K., it has several international efforts. In early 2020, the company launched its triage chatbot service in the U.S. The previous year, the company launched its telehealth app, Babylon by Telus in Canada.

Since launching in Canada the company announced it sold off its Canadian operations to former partner Telus Health in a licensing deal projected to be worth $70 million.

The company also has a long history with the Rwandan government. In 2020 Babylon's Rwanda-focused virtual care subsidiary Babyl inked a 10-year partnership with the country's government giving every person over the age of 12 access to digital health consultations.

The company's chatbot has spurred some critics. In 2018 the company conducted a head-to-head comparison in a simulated diagnostic environment in which the service outperformed doctors. This claim was highly contested by professional groups. It wasn’t long before NHS officials began delaying rollouts of the GP at Hand app due to patient safety concerns.