The$ 4.5 trillion healthcare industry will undoubtedly benefit from the development of relational AI and additional automation systems.
However, it won’t be simple for early-stage businesses to enter a highly regulated and generally slow market.
” Everything in healthcare moves at glacial pace”, said , a longtime managing partner at , which recently $ 2.3 billion for its 11th fund.
Naini, who has been at the Seattle-based private equity firm for more than three decades, said he’s seen software investors become frustrated when they make a move into care.
” You’ve got a structure that’s already in place and you’re sort of turning a ship in a lake”, he told GeekWire in a recent interview.
Another trend that could hinder digital health businesses is that many medical institutions lack the flexibility to invest in and embrace new systems because they aren’t in a strong financial position and aren’t in a position to do so, according to Naini.
” When you’re funding your corporations with venture capital … you can’t bear those long sales processes and long shifts within an business”, he said.
Venture investors poured more than$ 10 billion into digital health companies last year, with AI-focused startups taking 37 % of total funding, according to Rock Health.
There are a number of Seattle-area tech startups making moves in care, including CalmWave, a “quiet ICU” company that just $ 5.2 million, and Abbett, which $ 11.6 million to address healthcare costs.
Healthcare-related M&, A exercise has also been heating up in the region over the past year, for both larger companies such as and , as well as businesses including and .
Additionally, Providence Ventures spun out a fresh venture capital firm called Allumia Ventures next month, which is raising a huge new account.
Frazier Healthcare concentrates on more well-established companies that are ripe for automation using cutting-edge systems like AI.
” AI is a revolutionary facilitator for the medical market”, Naini said. ” However, I wouldn’t go as far as saying it’s going to change the entire business. There will be pretty particular areas where it might be helpful.
Naini stated that he anticipates bigger software companies like Microsoft and Amazon to gain momentum in some medical industry sectors. However, those businesses will also require patience and possibly a commitment to refuse.
” When you’re reporting quarterly numbers, you better be very large so you can capture a slower-than-expected transformation”, Naini said.
Frazier is especially serious in sectors including medical services, rural care, and women’s health.
The business has about 90 employees and has an operations crew that supports investment companies across a variety of disciplines. It plans to open a new office in New York City after this time.
Naini expressed optimism about the economic environment this year, in part because of the volume of “dry powder” companies must use.
” I think you’re going to see a lot more action in 2025″, he said.
Frazier split down into two separate money in 2013, creating the growth-focused medical finger that’s based in Seattle, along with , which operates venture funds and public funds with a focus on biotechnology and therapeutics. , based in Silicon Valley, $ 630 million for its latest bank in October.