Leading Australian venture capital firms Blackbird and Airtree will be among investors to benefit from an agreed $1.64 billion sale of health care products online sales business Eucalyptus.
Eucalyptus, which has become one of Australia’s largest sales channels for weight-loss drugs, is to be acquired by US company Hims & Hers Health Inc (NYSE: HIMS).
Established in 2019, Eucalyptus, is yet to reach profitability but currently has an annual run rate of more than $642 million. Hims & Hers, which was established in 2017, has a similar business model, using an online telehealth platform to sell prescription medications, over-the-counter medications and personal care products direct to consumers. The big difference is that San Francisco-based Hims & Hers had revenue of $US872 million ($1.238 billion) in 2023, the last year for which figures are available. Over recent years, the company has become a massive supplier of weight loss drugs in the US and other markets.
Eucalyptus was launched by a four-man team including established entrepreneur Tim Doyle who is now the company’s chief executive. Doyle is to retain 10% of the business with the sale of the rest of his shares expected to return him around $163 million.
Doyle will take up a role as a senior vice president of international at Hims & Hers, overseeing the company’s international business.
“By joining Hims & Hers, we will help more people globally believe in the future of healthcare: simple, high-quality, personal, and designed to help prevent disease instead of merely treating it,” said Doyle.
The other Eucalyptus co-founders, Benny Kleist, Charlie Gearside and Alexey Mitko are also believed to be in line for $100 million-plus payouts.
Former chief financial officer Alexey Mitko, who left the business a few years ago, last year joined Maxine Minter as a partner at very early-stage venture firm Co Ventures.
Silicon Valley-based growth capital firm BOND, the firm launched by former Kleiner Perkins partner Mary Meeker, is another substantial investor in Eucalyptus. Other investors include Sydney late-stage venture capital firm OneVentures, Woolworths’ investment arm W23, sports stars-backed Athletic Ventures, Marbruck as well as individual angel investors.
With the demand for weight-loss drugs continuing to drive its revenues, late last year Eucalyptus was reported to be working on a funding round that would have valued it at $1.37 billion. A $50 million follow-on venture capital round raised in the first half of 2023, was believed to have valued Eucalyptus at $560 million.
Image: Eucalyptus chief executive and co-founder Tim Doyle.