Investors Remain Bullish on AI Healthcare Startups Despite Some Concerns of Overvaluation
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Investors have higher standards now for healthcare startups, writing smaller checks at lower valuations compared to 2021's funding frenzy.
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But AI healthcare startups are an exception, with investors rushing to back deals in ambient documentation, medical claims processing, and medical imaging.
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Some AI healthcare startups land large rounds despite little revenue, concerning some investors about inflated valuations.
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Many VCs said they’re seeing “AI washing” from startups exaggerating their AI capabilities to attract funding.
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Investors agree AI will transform healthcare but it will take longer than other industries given healthcare’s complex regulatory and safety barriers.