{"id":3113,"date":"2025-01-15T19:04:33","date_gmt":"2025-01-15T19:04:33","guid":{"rendered":"https:\/\/medical-article.com\/?p=3113"},"modified":"2025-01-15T19:04:33","modified_gmt":"2025-01-15T19:04:33","slug":"aint-no-shame-in-the-heart-of-vc","status":"publish","type":"post","link":"https:\/\/medical-article.com\/?p=3113","title":{"rendered":"Ain\u2019t no shame in the heart of VC"},"content":{"rendered":"
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By MATTHEW HOLT<\/p>\n

It\u2019s JPM week. That means a ton of startup bros wandering around San Francisco wondering who all the biotech guys and investment banker greyhairs are and why they\u2019re still wearing suits.<\/p>\n

Unlikely to be wearing suits are the digital health kids and the VCs they are trying to hunt down. The glory days are long gone. Athenahealth and Venrock are no longer having competing parties (or parties at all) and most of the starving startup kids looking for free booze and food are trying to scrounge invites to law firms who are still charging $1500 an hour for associate time before their clients notice that ChatGPT will do the same for $20 a month.<\/p>\n

But venture in digital health continues on, even if much of it is subtexting cramdown M&A, such as last week\u2019s General Catalyst deal funding Transcarent\u2019s takeover of Accolade<\/a>. But I\u2019m not really here to talk about the digital health VC market per se.\u00a0<\/p>\n

What I do want to talk about is who is getting VC. This was prompted (to my slow Small Language Model) by a female friend who has been a CEO and was once a star at a fast growing digital health company. She told me that being female was now an active hindrance to raising money. Every time some tech bro on LinkedIn says how they raised $XXm in 12 minutes with no pitch deck, you\u2019ll see lots of female CEOs explode in anger.<\/p>\n

You don\u2019t need me to repeat the numbers. Women & minorities find it hard to raise money. First time founders get a massive run around. Even when things were crazy in 2020-2022 the survey of startups I ran<\/a> showed that it was very hard for early stage companies to raise money. Now it\u2019s the apocalypse.<\/p>\n

That\u2019s not to say some female CEOs aren\u2019t raising. Just last week Nema Health run by former Health 2.0 star intern (and now practicing Psychiatrist\u2013which may be more relevant!) Sofia Noori raised $14m Series A to expand its amazing PTSD cure program<\/a>. Maven\u2019s Kate Ryder raised another $125m<\/a> late last year to keep expanding their women\u2019s health program, and must be viewing that elusive IPO sooner or later. And at a JPM party I ran into some of Joanna Strober\u2019s team, reminding me that I thought Midi Health had perhaps raised too much money when it pulled down another $60m last year<\/a>\u2013but apparently it is going gangbusters. There\u2019s also Equip for eating disorders with Kristina Saffran & Erin Parks at the helm (over $95m in so far<\/a>) and doubtless a few more I\u2019m forgetting. But in general they are the exceptions.<\/p>\n

What\u2019s not the exception is the tech bros raising for AI. Obviously the big players here are OpenAI, Anthropic et al pulling down billions to build their AI infrastructure. Anyone with a 401K is probably hoping that all works out given how much of the value of Nvidia, Tesla, Google, Meta, Microsoft & Apple seems to be based on a perhaps mythical AI abundant future. But there\u2019s plenty in health care. Just this week Innovaccer ($275m), Qventus ($105m) & Truveta ($320m) all backed up the truck, all to combine data, AI and hope it will solve some of health care\u2019s troubles.Those CEOs are men. But that\u2019s not what I am complaining about.<\/p>\n

You can also be a man and get away with a lot more. Hippocratic AI\u2019s CEO Manjul Shah ran his last company HealthIQ into the ground. He screwed over suppliers, employees and customers to at least the tune of $17m in unpaid bills<\/a> according to Katie Jennings at Forbes, then took another $170k personally out of the bankrupt company<\/a> after he\u2019d left. Was he a pariah to the investors who\u2019s lost over $200m? Not in the least. The same investors A16Z and General Catalyst gave him another $50m right away to build an AI nurse chatbot company, and apparently health systems are lining up to buy it according to a podcast<\/a> he was on with Julie Yoo of A16Z last week. This week Kleiner Perkins (and more) kicked in another $141m<\/a>.<\/p>\n

You might also have noticed that Ali Parsa who went through over $1 billion and crucified all his public market investors too when Babylon Health cratered is also back. His new company \u2013 an AI assistant launched with some famous doctors including Shafi Ahmed \u2013 is called Quadrivia AI. Funding isn\u2019t clear but Sifted found some filings that indicate a Swedish VC is behind it<\/a>.There\u2019s also more than a little controversy about whether Babylon\u2019s demise was just a series of bad business decisions or Parsa was lying about the tech. (I had Parsa on a couple of panels and always found him deferential and charming, but you can google Sergei Polevikov\u2019s opinion<\/a>!)<\/p>\n

Look, unlike Lisa Bari at The Health Tech Talk Show, I love the idea of getting AI to answer patients\u2019 questions, call them with information and generally use bots to add \u201cabundance\u201d to the health care workforce. I mean it\u2019s just an extension of what Alex Drane and Eliza (and Silverlink & others) were doing 15 years ago. And there is huge possibility in using AI to actually diagnose and treat. I\u2019m sure Parsa\u2019s new AI bot also has the potential to improve physician care.\u00a0<\/p>\n

But should it be that easy for guys like Shah and Parsa to immediately get back in the game given the chaos they left in their wake? Shouldn\u2019t VCs have some qualms about anointing as saviours the very people who just screwed over their previous customers, partners, employees and investors?<\/p>\n

But I guess we have our answer already. Adrian Aoun took a big swing with Forward and closed it after losing $650m and leaving patients in the lurch with no notice<\/a> and 200 people unemployed. He was back on a podcast days later saying his investors wanted to give him more to start again. And the biggest loser, chaos agent and conman of recent years, Adam Nuemann of WeWork infamy, was back very soon after with another $350m for yet another real estate startup<\/a>.<\/p>\n

Neumann\u2019s benefactor in the latest round was A16Z\u2019s Mark Andreesen. Andreesen also famously helped fund Trump\u2019s election in 2024. That\u2019s the biggest comeback of someone with no morals, ethics or competence ever.<\/p>\n

So I guess at least some VCs have decided, there\u2019s no shame.\u00a0<\/p>\n

(If you\u2019re wondering about this piece\u2019s title, I am riffing off this blues classic<\/a>)<\/p>","protected":false},"excerpt":{"rendered":"

By MATTHEW HOLT It\u2019s JPM week. That means a ton of startup bros wandering around San Francisco wondering who all the biotech guys and investment banker greyhairs are and why they\u2019re still wearing suits. Unlikely to be wearing suits are the digital health kids and the VCs they are trying to hunt down. The glory…<\/p>\n","protected":false},"author":0,"featured_media":3108,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-3113","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles"],"_links":{"self":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/posts\/3113"}],"collection":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3113"}],"version-history":[{"count":0,"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/posts\/3113\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=\/wp\/v2\/media\/3108"}],"wp:attachment":[{"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3113"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3113"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/medical-article.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3113"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}