Redesign Health announced a new $175 million fund to launch innovative healthcare companies out of the venture builder. The fund is Redesign’s largest to date, and it will likely fund more than 20 companies.
Redesign was founded in 2018 by CEO Brett Shaheen, first an investor at Goldman Sachs, then a private equity investor at Carlyle and hedge fund Lone Pine Capital. Shaheen helped start dental company Candid in 2017, where he became interested in healthcare venture funding.
The healthcare venture builder has incubated more than 60 companies such as Scriptology, UpLift, Vivid Health and Baton. The new fund is expected to cultivate 20 additional companies that will address topics like healthy aging, expanding sites of service and interoperability.
The new fund contains $25 million more than its last fund, which it raised in 2021. The fund is expected to last for several years, Neil Patel, head of ventures at Redesign, told Fierce Healthcare in an interview. The new fund was backed by Declaration Partners, Euclidean Capital and True North Advisors.
Redesign prides itself on its hands-on mentorship of the fledgling startups it supports.
“We have positioned ourselves as the premier platform for those healthcare founders, or would-be healthcare founders, to be able to partner with us to take the research that we've done around specific pain points that exist, relationships with healthcare stakeholders and incumbents that we developed over the years,” Patel said. “Our value proposition is really to try to accelerate their ability and improve their odds of building a sustainable and potentially world-changing company.”
The company has eight investing themes it supports across all of its ventures: addressing the healthcare labor shortage, accelerating value-based and longitudinal care, advancing healthcare interoperability, preparing for an aging population, eliminating barriers to health equity, expanding sites of care, growing the insured population and driving healthcare personalization and consumerization.
Redesign also looks for a startups’ use of technology and how it intersects with their investing themes.
Patel said the fundraise is one indication that investors still want to tackle the $4 trillion healthcare industry.
“I view this as one indication that investors still fundamentally believe that there is a lot of wood to chop here; there's a lot of problems to solve … it's a large healthcare market,” Patel said. “There's tremendous opportunities to innovate, and I see this as a signal of investor confidence in our approach."