Investment in healthcare AI continues to boom, fueled by growing confidence that the technology can cut costs, simplify operations and increase access to care.
Reflecting that momentum, Town Hall Ventures announced a new fund this month to back startups applying AI to improve access and outcomes for underserved communities. The fund, which is Town Hall’s fourth, is targeting $440 million in capital.
Town Hall was founded in 2018 by former CMS administrator Andy Slavitt and longtime investor David Whelan. The investment firm — which is focused on vulnerable populations, particularly those covered by Medicare and Medicaid — has invested in 42 companies across launch, venture and growth stages.
The most important factor in Town Hall’s investment decisions is the drive and mindset of the founder, Whelan said.
“What we look for really is around the entrepreneur. It’s often less about the formal experience that someone has had, and more about the intrinsics of their curiosity, learning orientation, grit, hustle and their passion to really understand why things don’t work and how they can solve that particular problem. That passion is palpable and usually allows them to recruit an amazing team around them and the mission,” he explained.
Whelan highlighted Thyme Care — which partners with health plans, employers and risk-bearing providers to support patients battling cancer — as a flagship example of a Town Hall-backed company, noting that its founders were experienced entrepreneurs. He said that Town Hall helped accelerate and de-risk the startup’s growth, especially through payer and risk-based contracts.
The company has since built a durable business that boosts patient outcomes and reduces costs, Whelan stated. Value-based care companies like Thyme Care are ideal for AI implementation because they can innovate across the patient journey without being constrained by fee-for-service rules, he added.
He also pointed to Strive Health, a Town Hall-backed kidney care company, as another example of a team building cost-efficient wraparound care models while integrating AI strategically.
Whelan also noted that Town Hall prioritizes companies that not only address healthcare disparities, but also show the potential to build scalable businesses that can achieve profitability.
The new fund, which is Town Hall’s largest to date, allows the firm to support companies longer, helping them as they scale in a challenging market and pursue partnerships with payers and health systems, Whelan said.
He said that the firm’s mission will always remain the same, though: to help ensure AI-driven innovation benefits the populations that need it most.
“The fact is, we’re seeing the fastest adoption of any technology in clinical history with AI, and we want to make sure that those benefits accrue to populations that historically have been left behind. We are looking for founders and technologists to bring business models that use AI and tech to close gaps in U.S. healthcare — not to widen them,” Whelan declared.
Photo: Eugene Mymrin, Getty Images
