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Nikita Puri · · 9 min readAn unknown Singapore healthtech firm’s dubious $583m valuation
Collin Furtado contributed to this story.
Singapore-based Euda Health, a healthtech company founded in 2019 by Kelvin Chen, surprised some when it announced in April that it was going public in the second quarter of 2022 at an estimated post-money valuation of US$583 million.
This is a striking figure, considering that its 2021 revenue was only US$10.5 million.
Euda’s listing will be done through a merger with 8i Acquisition 2 Corp., a Nasdaq-listed SPAC.
Industry experts that Tech in Asia spoke with said they first heard of Euda only when the SPAC announcement made the news. Another insider found out about the healthtech firm’s existence when an ex-Euda employee applied for a position at their company last year. The insider added that their company’s industry partners hadn’t come across Euda, either.
Euda founder and CEO Kelvin Chen / Photo credit: Kelvin Chen
The SPAC listing announcement also raised other concerns. For instance, Euda’s valuation was based on projected revenue of US$50 million by 2022, but those estimates seemed to be based on expansion plans that hadn’t started.
In addition, James Meng Dong Tan, CEO and director of 8i, owned 10% in Watermark Developments Limited, which is the sole shareholder of Euda, presenting a potential conflict of interest.
Notably, Tan is also the CEO and director at 8i Enterprises, which had invested in a Euda-associated firm called Kent Ridge Health in 2020. Data from VentureCap Insights shows that 8i Enterprises owns 1.43% in Kent Ridge, which has the same founder as Euda.
Meanwhile, US-based law firm Brodsky & Smith had launched an investigation into the workings of 8i and its acquisition of Euda “for possible breaches of fiduciary duty and other violations of federal and state law.”
A month after its initial announcement, Euda said it was extending its due diligence period. Soon after, its US$583 million valuation was cut down to US$172 million.
Tech in Asia first reached out to Chen in May, but we received no response at the time. In June, the deal between Euda and 8i was amended to reduce the consideration payable by 8i to Euda and limit the earn-out payment available to Euda’s seller.
Image credit: Timmy Loen
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After significantly revising revenue projections and delaying expansion, Euda Health slashed its valuation by 70.5% just months before a Nasdaq listing.
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