Klara scores $15M financing round backed by Google's AI venture fund

New York City-based Klara is using artificial-intelligence-driven automation to improve communication between patients and their doctors' offices.

The startup's work to modernize medical practices has attracted Google's AI-focused investment fund Gradient Ventures, which co-led Klara's $15 million financing round.

Healthcare investor Frist Cressey Ventures also co-led the financing round with participation from existing investors FirstMark Capital, Lerer Hippeau, Project A and Stage 2 Capital. 

Klara, which launched in 2014, plans to use the funding to grow its team, further enhance its core communications product and build out AI-driven automation, the company said.

As one area of focus, the startup is working to integrate workflows with market-leading electronic health record (EHR) and practice management systems to drive automated scheduling, patient intake, payments and balance collection, co-founder and co-CEO Simon Bolz told Fierce Healthcare.

The startup also is adding new capabilities to enable multiple healthcare organizations such as practices, pharmacies and labs to jointly communicate with patients in one place, Bolz said.

RELATED: Investors poured $4B into healthcare AI startups in 2019

The company says it works with thousands of healthcare teams across more than 40 specialties.

Klara has raised $32 million to date.

Startups that focus on using AI to solve healthcare problems are attracting investors even during the COVID-19 pandemic. Healthcare AI startups raised $984 million in equity funding across 80 deals during the second quarter of 2020, according to CB Insights.

Google's Gradient Ventures launched three years ago to invest in early-stage companies shaping the future of AI by solving industrywide challenges with machine learning or finding innovative solutions to specific problems, according to the venture fund's website.

Other startups in Gradient's portfolio include Oura, maker of the Oura Ring, and Rad AI, which applies AI to radiology.

“As the world embraces remote interactions and work, physicians and medical practices are increasingly adopting new forms of digital communications with patients. The team at Klara has built an incredible product that delights doctors, patients, and operators within practices worldwide,” said Darian Shirazi, general partner at Gradient Ventures, in a statement.

“While the telemedicine market expands more rapidly than ever before, we’re excited to partner with Klara as they develop automated and intelligent solutions for the next generation of healthcare," Shirazi said.

RELATED: COVID-19 has accelerated the adoption of AI. Executives from Google Cloud, Suki and Olive spell out why

Bolz and co-founder Simon Lorenz started Klara to transform how patients and providers communicate, what they see as the single most important element of the doctor-patient relationship.

What initially started as a doctor-patient messaging solution has now become a patient engagement platform for healthcare providers, Bolz and Lorenz wrote in a blog post.

Klara's platform enables medical teams to easily communicate with patients, provide seamless virtual care and automate routine workflows.

By connecting with EHR and practice management systems, Klara automates many routine workflows across the patient journey including scheduling, pre-visit instructions, reminders, intake, no-show engagement and patient follow-up, according to the company.

"Focusing on communication first has given us a strong foundation to add other rich experiences such as electronic forms, scheduling, and reminders. Now, our automation of many routine workflows is fundamentally changing how healthcare organizations operate," Bolz said in a statement.

RELATED: Mental health startups saw record funding in Q1. Here are other sectors attracting investment amid COVID-19

The platform supports in-person care as well as virtual care, which is a capability many providers are demanding as consumer adoption of telehealth has surged during the COVID-19 pandemic.

The company has more than tripled its user base and usage since the COVID-19 pandemic hit earlier this year.

“Klara’s growth over the past years has proven that healthcare organizations need a solution that simplifies patient communication, optimizes provider workflows, and offers high-quality virtual care in one place,” Lorenz said in a statement.

As a new investor, Gradient Ventures can provide the startup with expert guidance on AI and large-scale market access, Lorenz said.

Along with the financing round, Klara also announced that Gradient Ventures' Shirazi and Navid Farzad, partner at Frist Cressey Ventures, are joining Klara’s board of directors.