Carmel-based Syra Health prices initial public offering

Syra Health Corp., a two-year-old Carmel startup that provides professional services in the health care and life science industries, has priced its initial public offering, it announced Friday.

The company said it would raise $6.7 million in gross proceeds, exceeding expectations from earlier this month, when the company estimated it would raise up to $5.4 million.

The proceeds were still lower than than the $8 million estimate the company made in May, when it first filed to go public.

The upsized IPO consisted of 1.615 million units, each priced at $4.125 per unit. Each unit consists of one share of Class A common stock and a warrant to acquire another share.

The stock was expected to begin trading on the Nasdaq Capital Market on Friday under the ticker symbol SYRA.

The proceeds could rise if underwriters exercise their over-allotment option, which would allow the sale of additional shares.

The company has granted the underwriters a 45-day option to purchase up to 242,250 additional units.

Syra said it intends to use the net proceeds from the offering for marketing and sales, application development, research and development, and working capital and other general corporate purposes. The lead underwriter is Kingswood Capital Partners LLC.

The IPO structure would keep most voting control in the hands of company insiders. Under a dual-stock owner plan, shares of Class A common stock will get one vote per share, but each share of Class B common stock will get 16.5 votes per share. As of April 15, there were 1 million shares of Class B common stock outstanding, representing 79.39% of the total voting securities outstanding.

The class B shares are largely held by CEO Deepika Vuppalanchi; Sandeep Allam, chairman and president; and Priya Prasad, chief financial officer and chief operating officer.

In its registration papers, Syra describes itself as a health care services company “promoting preventative health, holistic wellness, health education, and equitable health care.”

As of April 15, it had 64 full-time employees and 26 part-time employees.

In 2021, when it had 25 employees, it announced plans to add 126 new jobs by the end of 2025. The Indiana Economic Development Corp. said it would provide Syra Health with $2.1 million in tax credits if the company meets its job-creation commitments.

The company leases headquarters space at 1119 Keystone Way.

The company, which was founded Nov. 20, 2020, said the Indiana Family and Social Services Administration accounted for about 98% of its revenues in 2021 and 2022, and 92% of accounts receivable in 2021 and 2022. It provides services primarily to the NeuroDiagnostic Institute and Division of Mental Health and Addiction of the IFSSA.

Last year, Syra Health posted net revenue of $5.26 million and net loss of $2.09 million.