Olive AI Inc. was trying to land funding before abruptly shutting down, according to a notice to the state.
The decade-old Columbus health IT company had 115 employees remaining, including 33 living in Ohio, upon giving one to three days' notice of termination last week, according to the WARN filing with the Ohio Department of Job and Family Services.
"The company had hoped to complete one or more transactions and secure funds and business to prevent the closing of the business, but was unable to do so," said the notice, which was emailed to the state Oct. 31 but did not appear online until Monday. The list of affected positions included the company's CEO and other executives.
Olive sold its remaining product lines and shut down starting Tuesday, just over two years after raising Ohio's largest-ever venture capital round, $400 million, at a state-record valuation – $4 billion. The company making AI-powered software to automate hospital administrative tasks raised a cumulative $857 million in venture capital since its 2013 launch.
Co-founder and CEO Sean Lane has not been available for interviews.
The tech unicorn had grown to some 1,400 employees at its peak in April 2022, sevenfold growth over the year. But that summer it cut 450 jobs nationwide, and another 215 this February.
The notice said Olive was voluntarily providing notice of the closure, but said it did not admit the provisions of the federal Worker Adjustment and Retraining Notification Act applied. The short notice of the terminations fell under the law's exceptions for "faltering company" and "liquidating fiduciary," the notice said.
"These circumstances were not reasonably foreseeable at the time notice would have otherwise been required, and notice is further excused because the business is being liquidated," it said.
The office was empty Thursday afternoon as a representative for the building owner secured the premises.
Olive said in a brief statement on its website Tuesday that it had sold the business units representing "the heart" of operations:
- Waystar, a Louisville company that filed for its IPO in mid-October, is acquiring the revenue cycle business, which provides an electronic data clearinghouse for hospital billing departments and determines insurance eligibility. The company has not responded to messages seeking comment because it is in a required "quiet period."
- Humata Health is acquiring the business automating prior authorizations for hospital tests procedures, the statement said. The company did not provide information on Humata Health. Three affected employees confirmed that they were told in an all-staff meeting that the startup would be formed by the former CEO of a prior authorization startup that Olive had acquired two years ago, essentially buying the business back.
Olive said it has already communicated the transition to its customers.
"We believe this decision will provide important stability and a bright future for these customers," the company said in its statement.
By Thursday Olive's website redirected to Waystar. There has been no federal bankruptcy filing, and the incorporation record with the Ohio Secretary of State has not yet changed.
The company had been founded as CrossChx in mid-2012, testing identity resolution technology at an Ohio hospital, but launched more broadly and formed a Delaware corporation in 2013. It was among the first few companies that Columbus-base Drive Capital LLC invested in. Drive participated in several following rounds. The VC firm has declined to comment.
Olive, robotic process automation for hospital administrative tasks, debuted in 2018. The pivot started what at first was meteoric growth with hospital customers.
