Against the odds: Digital health startup Hinge Health pushes for IPO as rivals retreat

In March, we wrote about Hinge Health after it announced plans to go public as early as April, hoping to ride a sector rebound. The company later delayed that timeline. Now, the digital physical therapy startup isn’t waiting for the IPO freeze to thaw.

While high-profile names like Klarna and StubHub have hit pause on going public, the digital physical therapy startup is pressing forward. The company filed its IPO paperwork in March, aiming to debut on the New York Stock Exchange under the ticker “HNGE.”

It’s a bold move. Market volatility has pushed many companies to stay on the sidelines. Yet Hinge’s co-founder and CEO, Daniel Perez, is embracing the moment. That resilience isn’t new. Perez has spent a decade pushing his company through tough cycles and harder markets—and he’s asked his employees to adopt the same mindset. Internally, he’s even awarded staff the “Cockroach Award,” a cheeky but telling nod to survival instinct.

From Cockroach Award to Wall Street: Hinge Health Makes Its IPO Move

Perez once decorated Hinge’s old London office with a giant picture of a cockroach. Employees wore cockroach squad t-shirts and celebrated their endurance. The insect, unofficially named Flossy, became the symbol of a company that was never meant to move fast and break things—it was built to survive.

“It was the identity of every individual in the company,” Joshua Sturm, a vice president at Hinge from 2019 to 2024 and now chief revenue officer at cancer prevention startup Color Health, told CNBC. “We are all in this together, and no matter what happens, we are going to survive together.”

Now headquartered in San Francisco with a 1,400-person team, Hinge is betting it can break through investor hesitation. The digital health sector has been sluggish for years, even before President Trump’s latest tariff policy rattled markets again.

Digital health IPOs have slowed to a crawl. Teladoc, once a giant in the space, saw its valuation plummet after acquiring Livongo in a deal worth $37 billion. Its BetterHelp unit is struggling to retain users post-pandemic.

Despite the sector’s challenges, Hinge reported $390.4 million in revenue last year, up 33%, and trimmed its net loss from $108.1 million to $11.9 million. Its client base grew to more than 2,200 organizations, with over 532,000 individual users. That includes major employers like Target and Morgan Stanley, who cover access to Hinge’s virtual therapy tools and its wearable nerve stimulation device, Enso.

Hinge has raised over $1 billion to date, and its last valuation hit $6.2 billion in late 2021. Insight Partners and Atomico hold the largest stakes.

Founded in 2014 by Daniel Perez and Gabriel Mecklenburg, Hinge Health helps patients recover from musculoskeletal injuries, offering therapy from the comfort of their homes. The potential IPO has drawn attention in the digital health sector, which has struggled since the COVID-19 pandemic.

The startup traces its roots back to the U.K., where Perez and co-founder Gabriel Mecklenburg, both former PhD students, sketched out their idea in 2014. Each had experienced long, painful recoveries—Perez after being hit by a car at 13, Mecklenburg after a judo injury. They built the first prototype within months.

Early on, the two met weekly to discuss progress. That ritual continues today—just on Wednesday nights instead of weekend mornings. Mecklenburg now serves as executive chairman. Perez became a father last year.

The company culture has always been intense. Former employees describe Perez as direct, driven, and relentlessly focused. At one point, the Cockroach Award was replaced by the “Movers Award,” a shift to better reflect the company’s branding around movement and physical rehab.

Hinge’s hiring process is infamously tough. Perez is known for pushing memo-writing over slide decks, taking inspiration from Amazon’s document culture. Meetings often start with long written briefs, forcing teams to clarify their thoughts without hiding behind bullet points.

Employees say it made them better thinkers.

“He’s one of those rare founder CEOs who I think can go all the way,” said Paul Kruszewski, a former employee who joined Hinge through its acquisition of Wrnch.

Perez is a heavy reader and encourages his team to read too. Executives often discuss chapters of books like “Crossing the Chasm” or “The Innovator’s Prescription” in team meetings. He sends out books like some CEOs send company swag.

“He didn’t care too much what people thought about him, which is a strength in my book,” said Richard Badenhausen, Perez’s former college dean.

The startup’s early backers, like Atomico, saw something in that grit. “Lots of learnings along the way, of course, like a big tech correction in the middle,” said investor Carolina Brochado. “But it really is one of those rare examples of just an enormous market that was underpenetrated.”

Perez’s twin brother David, now a partner at a major law firm, joked: “I’m only the second most successful twin. But I think I’m okay with that.”

Hinge’s story has never been clean or easy. And that’s the point. The company was built to survive. Now it’s time to find out if Wall Street agrees.