Vertical payments startup Flywire has acquired healthcare technology startup Simplee, while also closing a $120 million Series E investment round led by Goldman Sachs, the company announced on Thursday (Feb. 13).
Flywire will use the investment to optimize and scale digital payment services across its core sectors, including healthcare, education and travel.
This funding round brings the company’s total capital investment to $260 million. Tiger Management and Adage Capital Management also joined the round as new investors, with participation from existing investors.
The global payments industry is expected to increase at a CAGR of 5.9 percent from 2019-2028 and is expected to comprise a $2.5 trillion industry by 2028, according to Boston Consulting Group.
“The payments industry has numerous inefficiencies and poorly integrated point solutions, which accelerate financial losses,” the release said.
High-deductible health plans are contributed to rising healthcare costs. It is estimated that U.S. healthcare patients will be responsible for $365.5 billion in out-of-pocket costs every year. The market opportunity for Flywire is roughly 70 percent of all U.S. eCommerce spend, the release indicated.
“Flywire is uniquely built on a global payments network, which is the cornerstone of how we move billions of dollars across 200+ countries and 150 currencies, and an industry-leading payments platform,” said Mike Massaro, CEO of Flywire. “This digital foundation enables us to develop vertical-specific applications that make payments more efficient and cost-effective for our global clients. The Simplee acquisition improves patient engagement and healthcare affordability and extends these capabilities to a broader customer base.”
Flywire’s high-tech platform for providers and Simplee’s consumer-first paths to payment aim to help patients and providers settle payments faster and on their own terms. Together, the companies will power four of the top 10 U.S. healthcare systems and process in excess of $10 billion in payments.
“We are thrilled to lead the Series E round for Flywire,” said Ashwin Gupta, managing director at Goldman Sachs’ merchant banking division. “They bring together a unique blend of a payments network, platform and vertical-specific solutions to completely digitize the payments experience for their clients across industries. We look forward to continuing to help accelerate Flywire’s growth.”
Patients, hospitals and medical services providers that fail to get a good handle on costs, bills and payments at the start of the healthcare process increase the risk that payments will go uncollected, among other problems.