Healthcare software startup Olive has closed a $51 million funding round to scale its AI-enabled robotic process automation solution.
The funding round was led by General Catalyst with existing investors Drive Capital, Oak HC/FT and Ascension Ventures also participating. The company has raised about $123.8 million to date.
The Columbus, Ohio-based company also announced Ronald Paulus, M.D., former president and CEO of Mission Health, will join its board.
The funding will enable Olive to accelerate its growth, and the company plans to use the financing to invest in R&D and engineering, CEO Sean Lane told FierceHealthcare.
Lane and his team launched the company in early 2017 with the idea to tackle the high-volume, repetitive and manual tasks healthcare workers do every day—tasks like prior authorization and benefits verification—but faster and more accurately.
The company refers to its solution as a "digital employee." Health systems are using Olive in operational areas like revenue cycle management, finance, accounting, supply chain, human resources and IT. The technology helps deliver improved efficiency, reduced costs and increased employee capacity.
The current COVID-19 pandemic only increases the need for automation solutions, Lane said.
"Most of the things that Olive does today is 'keep the lights on' activities in HR, finance and IT. We call Olive an 'AI worker' who can show up for work every day despite what is facing the country, and that enables continuity of operations," he said.
Current health system customers are leveraging Olive's capabilities to address new automation tasks, he noted.
"Many health systems are seeing the real value of an AI workforce to be there, even when humans aren’t," he said.
Interest in artificial intelligence in healthcare soared in 2019 with investors pouring $4 billion into the sector across 367 deals, according to a report from CB Insights. That's up from nearly $2.7 billion invested in healthcare AI in 2018.
Driving efficiency in nonclinical work enables hospitals and healthcare leaders to focus more resources on the actions and activities that improve care, the company said.
“As a recent health system CEO, I appreciate the duress our hospitals are under as they focus on delivering the best patient care possible under challenging circumstances all while needing to keep the lights on,” said Paulus. “Olive’s reliable automation of essential back-office processes saves time, reduces errors and allows staff to focus on higher-order work."
Olive now works with more than 500 U.S. hospitals across 41 states, including 25 of the nation’s largest health systems.
Olive secured the latest funding before the COVID-19 outbreak began spreading in the U.S., according to Lane.
The ongoing virus outbreak and economic volatility will likely have a major impact on healthcare technology startups in 2020.
"It's going to be a tough time for startups. For early-stage companies trying to fundraise right now, it will be extraordinarily hard," Lane said.
Olive's status as a growth-stage company with an "established and growing footprint of customers" puts the company in a better position to "weather the storm," he noted.
"We have a solution that health systems can use today to help keep the lights on. Our solution also has long-term value, and it's shifting from being a nice-to-have to a must-have," Lane said.
He added, "We’re definitely going to be impacted by it. We will adjust and we will dynamically react to the market and the environment. We will use this opportunity to double down on R&D and make sure that we continue to innovate and deliver value to our customers."