HealthTech SaaS Startup HealthPlix Cut 25% of Workforce Over Performance Concerns and Redundancies

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Three points you will get to know in this article:

  • HealthPlix, a Bengaluru-based healthtech SaaS startup, restructures.
  • 100 employees depart due to performance issues and role redundancies.
  • Sales division primarily affected; aligns with global expansion strategy.

Introduction to HealthPlix

HealthPlix is a digital healthcare platform in India that prioritizes empowering doctors by providing efficient and cost-effective software systems. They aim to simplify doctors’ workflow, expedite report writing, and enhance efficiency, enabling doctors to allocate more time to patient care and less to administrative tasks. HealthPlix offers an AI-driven EMR (Electronic Medical Records) software that supports doctors in making informed decisions at the point of care. Trusted by over 10,000 doctors, HealthPlix is known for its high doctor retention rate, productivity, user-friendly interface, and prescription writing in 14 regional languages. The platform focuses on comprehensive digitization of a doctor’s practice without the need for additional infrastructure to start.


Restructuring at HealthPlix

HealthPlix, a healthtech SaaS startup based in Bengaluru, recently underwent a restructuring phase, resulting in the departure of 100 employees, constituting a quarter of its workforce. According to a spokesperson speaking to Inc42, approximately 60 individuals left due to performance issues, while the remainder were affected by role redundancies.

The spokesperson clarified that the decision to let go of 55 to 60 employees was primarily driven by performance concerns identified during the annual appraisal process. They emphasized the necessity of this action within the context of performance evaluation.

According to insights, most of the employees let go because of performance concerns hailed from the sales division.

Even though these individuals weren’t formally placed on a performance improvement plan (PIP), they did receive constructive feedback on multiple occasions to help them address areas needing improvement, as mentioned by the company spokesperson.

HealthPlix Expansion Strategy

Furthermore, the restructuring efforts affected teams across sales, product development, engineering, and revenue, leading to a 10% decrease in the overall staff count at HealthPlix.

“The company’s restructuring aligns perfectly with its next phase of growth,” the spokesperson stated. “HealthPlix is gearing up to expand globally and is strategizing to develop enterprise solutions tailored for international clients.”

Financial Changes and Funding Milestones

Moreover, our team has discovered that HealthPlix has begun implementing charges for its electronic medical record (EMR) software, a service it previously provided free of charge. The aforementioned sources also mentioned that the restructuring might impact even more employees than the startup acknowledged. Each and every one of the 100 employees is set to receive severance pay as outlined in their contracts. The majority of them will get two months’ worth of severance pay. Established in 2014 by Sandeep Gudibanda, Raghuraj Sunder Raju, and Prasad Basavaraj, HealthPlix enables doctors to build comprehensive medical profiles for their patients using its ERM software, aiding them in subsequent consultations.

Last year during a challenging period for funding, the startup secured $22 million in its Series C funding round, blending equity and debt. Avataar Venture Partners and SIG Venture Capital spearheaded the investment. At that time, the startup pledged to expand its network of doctors and bolster its sales, product, and engineering divisions with the raised funds. Presently, HealthPlix collaborates with approximately 14,000 doctors.

Financial Performance Analysis

The startup has secured $40 million in funding so far and has the support of major investors like Lightspeed Venture Partners, JSW Ventures, Kalaari Capital, and Chiratae Ventures.

In the fiscal year 2022-23 (FY23), the company experienced a net loss of INR 41.9 crore, marking a 17% increase from the previous fiscal year’s loss of INR 35.8 crore. However, its revenue soared to INR 29.1 crore from INR 13.6 crore in FY22.

Employee benefits, totaling INR 53.9 crore, stood as the startup’s largest expense, comprising 75% of its total expenditure of INR 71.5 crore in FY23. Employee expenses surged by 65% compared to FY22, reaching INR 32.6 crore.

Market Competition and Sector Challenges

HealthPlix is in competition with startups such as Practo in the EMR domain. It is important to mention that startups in this sector have faced challenges recently. For example, Phablecare, backed by Kalaari Capital, ceased its operations last year, and Docon, acquired by PharmEasy, underwent a significant restructuring in 2022.

HealthPlix, a Bengaluru-based healthtech SaaS startup, recently restructured by releasing 100 employees, citing performance issues and role redundancies. The restructuring primarily impacted the sales division, aligning with the company’s growth strategy of global expansion and enterprise solutions development. Despite challenges, including implementing charges for its EMR software, HealthPlix has secured substantial funding, expanded its network to 14,000 doctors, and remains supported by key investors. Fiscal year 2022-23 saw increased revenue but also higher losses, with employee benefits forming a significant portion of expenditures. The startup operates in a competitive EMR market alongside companies like Practo and has persevered through industry challenges.

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