W Health Ventures has launched a US$ 70 million second fund to create and grow healthcare companies, according to an announcement on July 30.

The early-stage venture capital firm invests in healthcare companies addressing critical unmet needs in India and the US.

The new fund will support the launch of 8 to 10 healthcare startups over the next four years.

It will focus on single-specialty care delivery platforms and AI-enabled B2B healthcare services supporting US-based healthcare firms.

W Health has already started deploying capital, with EverHope Oncology, a cancer care startup, receiving a US$ 10 million investment led by Narayana Health.

W Health’s past investments include Nivaan, Mylo, BeatO, BabyMD, Wysa, and Reveal HealthTech.

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🔗 Source: W Health Ventures

🧠 Food for thought

1️⃣ Venture studios help overcome healthcare’s notoriously high startup failure rates

Healthcare startups face brutal odds, with 90% failing in the long run and 60% failing within five years1.

W Health’s partnership with venture studio 2070 Health directly addresses these challenges by embedding startup infrastructure and platform teams at the point of incubation, rather than leaving founders to navigate the sector’s complexities alone.

This hands-on approach appears to be working. While global digital health venture survival rates lag behind other sectors, India’s digital health startups maintain an 80% survival rate2.

The model makes particular sense in healthcare, where the original article notes the sector is “heavily regulated, relationship-driven, clinically complex, and slow to change.” These barriers can be more effectively addressed by experienced operators compared to traditional VC funding alone.

2️⃣ Cross-border AI services capitalize on India’s growing healthcare technology capabilities

W Health’s strategy of building AI-enabled B2B companies that serve US healthcare firms leverages a significant market opportunity and talent arbitrage.

India’s AI healthcare market is projected to reach $1.6 billion by 2025, growing at 40.6% annually3. The country’s digital health ecosystem has grown rapidly, with health-tech startups expanding at a 127% compound annual growth rate from 2016 to 20234.

This cross-border approach allows Indian companies to tap into the much larger US healthcare market while benefiting from India’s deep pool of clinical professionals and engineers at lower costs.

The model is already evident in W Health’s portfolio. Companies like Wysa provide AI mental health services globally, and Reveal HealthTech offers AI transformation services to international healthcare firms, demonstrating the viability of exporting Indian healthcare innovation.

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