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Ain’t no disgrace within the coronary heart of VC – The Well being Care Weblog


By MATTHEW HOLT

It’s JPM week. Meaning a ton of startup bros wandering round San Francisco questioning who all of the biotech guys and funding banker greyhairs are and why they’re nonetheless sporting fits.

Unlikely to be sporting fits are the digital well being children and the VCs they’re making an attempt to seek out. The glory days are lengthy gone. Athenahealth and Venrock are not having competing events (or events in any respect) and many of the ravenous startup children on the lookout for free booze and meals are attempting to scrounge invitations to regulation corporations who’re nonetheless charging $1500 an hour for affiliate time earlier than their shoppers discover that ChatGPT will do the identical for $20 a month.

However enterprise in digital well being continues on, even when a lot of it’s subtexting cramdown M&A, akin to final week’s Basic Catalyst deal funding Transcarent’s takeover of Accolade. However I’m not likely right here to speak concerning the digital well being VC market per se. 

What I do wish to discuss is who’s getting VC. This was prompted (to my sluggish Small Language Mannequin) by a feminine good friend who has been a CEO and was as soon as a star at a quick rising digital well being firm. She instructed me that being feminine was now an lively hindrance to elevating cash. Each time some tech bro on LinkedIn says how they raised $XXm in 12 minutes with no pitch deck, you’ll see numerous feminine CEOs explode in anger.

You don’t want me to repeat the numbers. Ladies & minorities discover it laborious to lift cash. First time founders get a large run round. Even when issues had been loopy in 2020-2022 the survey of startups I ran confirmed that it was very laborious for early stage corporations to lift cash. Now it’s the apocalypse.

That’s to not say some feminine CEOs aren’t elevating. Simply final week Nema Well being run by former Well being 2.0 star intern (and now working towards Psychiatrist–which can be extra related!) Sofia Noori raised $14m Collection A to develop its superb PTSD remedy program. Maven’s Kate Ryder raised one other $125m late final yr to maintain increasing their ladies’s well being program, and should be viewing that elusive IPO in the end. And at a JPM social gathering I bumped into a few of Joanna Strober’s group, reminding me that I assumed Midi Well being had maybe raised an excessive amount of cash when it pulled down one other $60m final yr–however apparently it’s going gangbusters. There’s additionally Equip for consuming problems with Kristina Saffran & Erin Parks on the helm (over $95m in to date) and likely just a few extra I’m forgetting. However usually they’re the exceptions.

What’s not the exception is the tech bros elevating for AI. Clearly the large gamers listed here are OpenAI, Anthropic et al knocking down billions to construct their AI infrastructure. Anybody with a 401K might be hoping that every one works out given how a lot of the worth of Nvidia, Tesla, Google, Meta, Microsoft & Apple appears to be based mostly on a maybe legendary AI considerable future. However there’s a lot in well being care. Simply this week Innovaccer ($275m), Qventus ($105m) & Truveta ($320m) all backed up the truck, all to mix information, AI and hope it can remedy a few of well being care’s troubles.These CEOs are males. However that’s not what I’m complaining about.

You may also be a person and get away with much more. Hippocratic AI’s CEO Manjul Shah ran his final firm HealthIQ into the bottom. He screwed over suppliers, staff and clients to at the least the tune of $17m in unpaid payments in response to Katie Jennings at Forbes, then took one other $170k personally out of the bankrupt firm after he’d left. Was he a pariah to the traders who’s misplaced over $200m? Not within the least. The identical traders A16Z and Basic Catalyst gave him one other $50m immediately to construct an AI nurse chatbot firm, and apparently well being programs are lining as much as purchase it in response to a podcast he was on with Julie Yoo of A16Z final week. This week Kleiner Perkins (and extra) kicked in one other $141m.

You may also have seen that Ali Parsa who went by means of over $1 billion and crucified all his public market traders too when Babylon Well being cratered can also be again. His new firm – an AI assistant launched with some well-known medical doctors together with Shafi Ahmed – is named Quadrivia AI. Funding isn’t clear however Sifted discovered some filings that point out a Swedish VC is behind it.There’s additionally greater than a bit controversy about whether or not Babylon’s demise was only a collection of dangerous enterprise selections or Parsa was mendacity concerning the tech. (I had Parsa on a few panels and all the time discovered him deferential and charming, however you’ll be able to google Sergei Polevikov’s opinion!)

Look, in contrast to Lisa Bari at The Well being Tech Discuss Present, I really like the thought of getting AI to reply sufferers’ questions, name them with info and usually use bots so as to add “abundance” to the well being care workforce. I imply it’s simply an extension of what Alex Drane and Eliza (and Silverlink & others) had been doing 15 years in the past. And there may be big chance in utilizing AI to truly diagnose and deal with. I’m positive Parsa’s new AI bot additionally has the potential to enhance doctor care. 

However ought to or not it’s that simple for guys like Shah and Parsa to right away get again within the recreation given the chaos they left of their wake? Shouldn’t VCs have some qualms about anointing as saviours the very individuals who simply screwed over their earlier clients, companions, staff and traders?

However I assume now we have our reply already. Adrian Aoun took an enormous swing with Ahead and closed it after shedding $650m and leaving sufferers within the lurch with no discover and 200 individuals unemployed. He was again on a podcast days later saying his traders needed to present him extra to start out once more. And the most important loser, chaos agent and conman of current years, Adam Nuemann of WeWork infamy, was again very quickly after with one other $350m for yet one more actual property startup.

Neumann’s benefactor within the newest spherical was A16Z’s Mark Andreesen. Andreesen additionally famously helped fund Trump’s election in 2024. That’s the most important comeback of somebody with no morals, ethics or competence ever.

So I assume at the least some VCs have determined, there’s no disgrace. 

(For those who’re questioning about this piece’s title, I’m riffing off this blues traditional)

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