By MATTHEW HOLT
It’s JPM week. Which means 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 youngsters and the VCs they’re attempting to seek out. The glory days are lengthy gone. Athenahealth and Venrock are now not having competing events (or events in any respect) and a lot of the ravenous startup youngsters searching for free booze and meals try to scrounge invitations to legislation companies who’re nonetheless charging $1500 an hour for affiliate time earlier than their purchasers 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 General Catalyst deal funding Transcarent’s takeover of Accolade. However I’m probably not right here to speak in regards to the digital well being VC market per se.
What I do need to speak about is who’s getting VC. This was prompted (to my gradual Small Language Mannequin) by a feminine pal 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 energetic 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 a lot of feminine CEOs explode in anger.
You don’t want me to repeat the numbers. Girls & minorities discover it onerous to boost cash. First time founders get an enormous run round. Even when issues had been loopy in 2020-2022 the survey of startups I ran confirmed that it was very onerous for early stage corporations to boost 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 practising Psychiatrist–which can be extra related!) Sofia Noori raised $14m Sequence A to expand its amazing PTSD cure program. Maven’s Kate Ryder raised another $125m late final yr to maintain increasing their ladies’s well being program, and have to be viewing that elusive IPO eventually. And at a JPM social gathering I bumped into a few of Joanna Strober’s group, reminding me that I believed Midi Well being had maybe raised an excessive amount of cash when it pulled down another $60m last year–however apparently it’s going gangbusters. There’s additionally Equip for consuming problems with Kristina Saffran & Erin Parks on the helm (over $95m in so far) 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 flattening 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 primarily based on a maybe legendary AI ample future. However there’s loads 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 would remedy a few of well being care’s troubles.These CEOs are males. However that’s not what I’m complaining about.
It’s also possible to 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, workers and prospects to at least the tune of $17m in unpaid bills in accordance with Katie Jennings at Forbes, then took another $170k personally out of the bankrupt company after he’d left. Was he a pariah to the buyers who’s misplaced over $200m? Not within the least. The identical buyers A16Z and Basic Catalyst gave him one other $50m immediately to construct an AI nurse chatbot firm, and apparently well being techniques are lining as much as purchase it in accordance with a podcast he was on with Julie Yoo of A16Z final week. This week Kleiner Perkins (and more) kicked in another $141m.
You may also have observed that Ali Parsa who went by way of over $1 billion and crucified all his public market buyers too when Babylon Well being cratered can also be again. His new firm – an AI assistant launched with some well-known docs together with Shafi Ahmed – is known as Quadrivia AI. Funding isn’t clear however Sifted found some filings that indicate a Swedish VC is behind it.There’s additionally greater than slightly controversy about whether or not Babylon’s demise was only a sequence of dangerous enterprise selections or Parsa was mendacity in regards to the tech. (I had Parsa on a few panels and at all times discovered him deferential and charming, however you may google Sergei Polevikov’s opinion!)
Look, not like 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 customarily 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’s big risk in utilizing AI to really diagnose and deal with. I’m certain 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 instantly 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 prospects, companions, workers and buyers?
However I suppose we now have our reply already. Adrian Aoun took a giant swing with Ahead and closed it after losing $650m and leaving patients in the lurch with no notice and 200 folks unemployed. He was again on a podcast days later saying his buyers wished to offer him extra to start out once more. And the largest loser, chaos agent and conman of current years, Adam Nuemann of WeWork infamy, was again very quickly after with one other $350m for yet another real estate 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 largest comeback of somebody with no morals, ethics or competence ever.
So I suppose a minimum of some VCs have determined, there’s no disgrace.
(In case you’re questioning about this piece’s title, I’m riffing off this blues classic)
