Sharecare Lands SPAC Deal, Launches Digital Vaccine Assistant For Partners: What Investors Should Know

A merger in the digital health space was announced Friday before the market open, with Sharecare being the latest health care company to go public via SPAC.

The SPAC Deal: Sharecare is going public in a SPAC merger with Falcon Capital Acquisition Corp FCAC.

The deal values Sharecare at $3.9 billion, which is 9.5x estimated 2021 revenue. Sharecare will receive $400 million in gross proceeds from the merger.

Shareholders of Falcon Capital Acquisition and investors in the PIPE will own 22% of the company after the merger. Shares will trade as "SHCR" on the Nasdaq.

About Sharecare: Sharecare is a digital health company that helps people consolidate and manage various components of their health in one place. Fragmented offerings in the industry are driving cost and vendor fatigue

Sharecare’s three business divisions are enterprise, provider and consumer solutions. Across the divisions, Sharecare has over 64,0000 employer clients.

Remark Holdings MARK is a shareholder in Sharecare along with Oprah Winfrey, Aflac AFL, Quest Diagnostics DGX and Wells Fargo WFC.

Sharecare Founder and CEO Jeff Arnold will continue to lead the company. The CEO founded several companies that have been sold including WebMD, HowStuffWorks and QDS.

Related Link: 10 SPACs Trading Under $11 For Investors To Consider In 2021

Growth Ahead: Sharecare’s presentation says the business is positioned for growth through scaling its business.

The company sees multiple paths to hitting $1 billion in revenue.

The company believes it has a new revenue opportunity with its health security segment. Sharecare is targeting the hospitality, sports venues, schools and workplace with this segment.

Sharecare has partnered with Forbes Travel Guide on the initiative.

Partners that have signed up for Sharecare include W hotels, Ritz Carlton and the State Farm Arena, home of NBA’s Atlanta Hawks.

The new business will help these customers show they are compliant with vaccines and negative COVID-19 tests for people entering the building, which could be a big step in reopening of large scale venues. Sharecare will offer a digital vaccine assistant for the platform.

Sharecare also acquired Doc.ai recently, an artificial intelligence digital solution that has a large multiyear deal with Anthem Inc ANTM.

Health insurer Anthem is an investor in Sharecare.

Financials: Sharecare has a recurring revenue model for many of its businesses, which helps provide sustainable and easy-to-forecast growth.

Current projections from the company’s presentation call for revenue of $396 million in fiscal 2021, $512 million in fiscal 2022 and $629 million in fiscal 2023.

Revenue was broken down by business segment in the company's presentation.

Sharecare projects that Enterprise will hit $190 million in fiscal 2020; provider will hit $80 million in fiscal 2020; and consumer will hit $56 million in fiscal 2020.

Projections call for enterprise to hit $227 million in fiscal 2021, provider to hit $104 million in fiscal 2021 and consumer to hit $65 million in fiscal 2021.

Sharecare has gross profit margins of over 50% and produced $167 million in gross profit in fiscal 2020.

FCAC Price Action: Share of Falcon Capital were down 3.91% at $11.31 at the close Friday.

Shares were over $13 in pre-market trading and hit an intraday high of $12.81. 

Disclosure: Author is long shares FCAC and MARK.