AI-ID Generative AI Tracker November 2023 Banner

Waystar Listing In Limbo Amid Unhealthy IPO Market

Waystar Preps IPO, Sees $15B Market for Healthcare Payments

Healthcare payments firm Waystar’s plans to go public are reportedly on hold.

The company had planned to begin an investors roadshow in advance of an initial public offering (IPO) this week, but will now wait to do so until December at the earliest, the Wall Street Journal (WSJ) reported Tuesday (Oct. 31), citing sources familiar with the matter.

PYMNTS has contacted Waystar for comment but has not yet received a reply.

Waystar’s IPO was anticipated to value the company in the “high-single digit billions,” the WSJ report said, and will likely wait until next year.

The reason? A shaky IPO market. Recent months have seen a number of high profile companies go public only to end up trading below their IPO prices. Sources told the WSJ that stock market declines, conflict in Israel and the Federal Reserve’s interest rate plans also factored into Waystar’s decision.

As the WSJ notes, traditional IPOs last year brought in the smallest amount in at least 20 years, and while this year looks better, the market is far from normal. As of Tuesday, traditional IPOs had raised about $19 billion, far below the $59 billion yearly average of the last decade.

The news comes less than two weeks after reports that marketing automation firm Klaviyo’s stock had dropped below its listing price, part of a string of companies whose IPOs were met with fanfare but eventually slumped: chipmaker Arm, grocery delivery platform Instacart and sandal company Birkenstock.

Waystar provides a cloud-based platform to improve what it terms “the administrative headwinds faced by providers,” as the company put it in a recent S-1 filing  with the Securities and Exchange Commission (SEC).

Healthcare remains one of the “largest and most complex vertical end-markets within the U.S. economy,” according to the filing. It’s an industry that makes up more than 18% of U.S. gross domestic product (GDP), where wasteful spending ranges from $760 billion to $935 billion.

“Of this, $350 billion is administrative-related, which is inclusive of healthcare payments-related waste,” Waystar said in the filing. The company has estimated that its total addressable market “with respect to our current software solution set” is in the range of $15 billion, increasing by mid-single digits, compounded, annually.

Research by PYMNTS Intelligence has underscored the fact that platforms and digital interactions are being embraced by providers and patients alike, with 80% of consumers saying they want a single digital platform that includes bill payments.