UnitedHealth’s Optum starts $250M venture capital fund with AI, cloud investments

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Optum, the consulting and services arm of health insurance giant UnitedHealth Group, announced at the launch of a $250 million venture capital fund investing in data analytics and digital health firms.

The fund, called Optum Ventures, will invest in startups which “use data and insights to help improve consumers’ access to healthcare services and how care is delivered and paid for, and that make the healthcare system more reliable and easier to navigate,” the company said at its investor conference in New York.

“Optum Ventures is uniquely positioned to help develop and grow startups and early-stage companies through capital investment, Optum’s decades of experience in healthcare, and our access to the health care marketplace,” Larry Renfro, CEO of Optum and managing partner of Optum Ventures, said in a press release. “Optum Ventures will be the partner of choice for companies developing innovations that help make health care work better for everyone.”

The fund’s four initial investments include two cloud-based platforms, Apervita and SHYFT Analytics, the latter of which is aimed at life sciences companies “with a focus on oncology, cardiovascular disease, diabetes and other specialty and rare disorders.”

The other two partners deal with artificial intelligence: Buoy Health promises an AI-powered “digital health assistant” for patients and Mindstrong Health seeks to use AI’s assessment of a patient’s smartphone use to diagnose and treat disorders like depression, schizophrenia and post-traumatic stress disorder.

The launch of the new fund came on the heels of Optum closing a $1.3 billion acquisition of the Advisory Board Company’s healthcare business. This included a 5.5 percent stake in hospital IT company Evolent Health, which means UnitedHealth is its largest shareholder.

According to CNBC, the moves could be UnitedHealth’s response to tech giants like Amazon and Apple’s rumored moves into the healthcare space.

“This is a restless company, dissatisfied with the status quo in health care,” said UnitedHealth Group CEO David Wichmann.

At the same investor conference, the company announced its outlook for 2018, projecting revenue growth of 12 percent, falling between $223 billion and $225 billion. Optum’s business has been one of the main drivers of this revenue growth along with expanded membership in Medicare Advantage plans.