After several sluggish years for digital health IPOs, investor sentiment is improving thanks to a wave of exits and a surge of enthusiasm around AI in healthcare. Omada Health and Hinge Health recently filed or debuted on public markets, offering long-awaited liquidity for early backers. While the broader IPO pipeline remains thin, companies like Sword Health may follow in coming years. Meanwhile, venture activity is heating up in the AI healthcare sector, with startups like OpenEvidence and Abridge commanding multibillion-dollar valuations. These companies, along with newcomers like Brellium and Thatch, are tapping into automation for back-office and compliance work — a lower-regulation entry point into the complex healthcare ecosystem.
What’s drawing the most attention now are LLM-driven platforms built for direct clinical interaction. Investors highlight a wave of early-stage companies that go beyond administrative automation to assist with diagnosis, symptom screening, and treatment — especially within private practices. Among the standouts in this space is Hippocratic AI, which has garnered significant capital and attention for building a conversational AI that supports chronic-care management. The company recently secured a $141 million Series B and has made bold claims about achieving safety parity with human nurses in certain domains of care. As interest in generative AI deepens at the hospital board level, such systems are increasingly viewed as practical tools for real-world healthcare delivery, not just experimental innovation.