- Artificial intelligence has quickly become the hottest investment in healthcare as developers and providers seek to harness the enormous potential of the industry’s big data assets.
Ambitious new start-ups, many backed by eyebrow-raising funding packages, are being announced every day as investors try to get in on the ground floor of the next revolution in clinical decision support, patient engagement, or financial optimization.
Globally, venture capital funding for health IT companies reached $5.5 billion in the first three quarters of 2017, outstripping the whole of 2016, says Mercom Capital Group. Data analytics start-ups received a full $1 billion of this bounty.
“The third quarter was all about data analytics with those companies garnering almost a third of the funding in Q3 and artificial intelligence companies receiving more than $200 million," said Raj Prabhu, CEO and Co-Founder of Mercom Capital Group.
Early in 2017, CB Insights added that the number of VC deals for healthcare-focused artificial intelligence start-ups has leapt from less than 20 in 2012 to around 70 in 2016.
For some of the luckiest entrepreneurs, generous funding is matched with support from some of the biggest names in tech: Microsoft, Google, and others who are hosting start-up boot camps and incubator programs to foster development of promising new tools and services.
With spending on artificial intelligence in healthcare expected to exceed $20 billion by the mid-2020s, large companies have a significant incentive to position themselves as AI experts as quickly as possible – and nothing says leadership like making an effort to mentor eager novices in the field.
“At Microsoft, we believe AI has the power to transform our world. Our approach to AI isn’t just limited to our products, but also how we participate in the broader community,” said Peggy Johnson, Executive VP of Business development when announcing $3.5 million in funding and awards for startups that can create or leverage “transformative AI technologies” in healthcare and elsewhere.
In partnership with venture capital entities, the global Innovate.AI competition will offer cash and Microsoft Azure credits to finalists who exhibit strong potential to significantly disrupt a field or address a specific use case.
“At Microsoft, the future is rooted in the advancement of AI technologies,” said Nagraj Kashyap, corporate vice president, global head of Microsoft Ventures. “We’re excited to launch this competition with a strong group of venture capitalists that recognizes the importance of leveraging these technologies to amplify human ingenuity and power innovation in AI forward.”
Participants will also be entered to win Microsoft’s AI for Good Prize, which rewards companies that strive to use artificial intelligence to create a better, smarter society.
“Startups are already able to create significant businesses based on AI at the platform and application levels,” said S. Somasegar, managing director, Madrona Venture Group, the investor that will contribute to the winning start-up from North America.
“Now that they are leveraging emerging AI platforms, opportunities are increasing to create not only a great business, but one that has a strong and positive impact on society.”
Google is also eager to ensure that its brand will be synonymous with artificial intelligence.
“Google is an artificial intelligence-first company. Machine learning (ML) and cloud are deeply embedded in our product strategies and have been crucial thus far in our efforts to tackle some of humanity's greatest challenges - like bringing high-quality, affordable, and specialized healthcare to people globally,” wrote Malika Cantor, Developer Relations Program Manager on the company’s blog.
The consumer tech behemoth is offering a six-month mentorship program called Launchpad Studio, which includes all-expenses-paid training at Google’s headquarters in Silicon Valley, personalized mentoring from experts, and credits for Google Cloud.
“Working side-by-side with experts from across Google product and research teams - including Google Cloud, Verily, X, Brain, ML Research -, we intend to support these startups on their journey to build successful applications, and explore leveraging Google Cloud Platform, TensorFlow, Android, and other Google platforms,” said Cantor.
“Launchpad Studio has also enlisted the expertise of a number of top industry practitioners and thought leaders to ensure Studio startups are successful in practice and long-term.”
The initial class of four machine learning companies all have a healthcare focus. One will attempt to use natural language processing, deep learning, and Glass smart glasses to reduce provider burnout and increase productivity.
Another will use artificial intelligence to analyze the brain wave patterns of patients with spinal cord and traumatic brain injuries. The results will be used to create personalized treatment protocols to facilitate improvement in motor skills.
Early sepsis detection in the emergency department, Internet of Things data processing, and clinical trial improvement are also among the four companies’ initial goals.
“Launchpad Studio is looking to work with the best and most game-changing ML startups from around the world. While we're currently focused on working with startups in the Healthcare and Biotech space, we'll soon be announcing other industry verticals, and any startup applying AI / ML technology to a specific industry vertical can apply on a rolling-basis,” explained Cantor.
While the incubators will only provide direct guidance to a tiny fraction of healthcare AI start-up environment, the hands-on involvement from influential companies like Microsoft and Google may pay off for the fortunate few.
But only time will tell if these companies manage to break through the crowded field and become successful contributors to the artificial intelligence ecosystem. With the number of competitors growing nearly daily, it remains to be seen whether involvement from established names in the industry is a truly effective strategy for start-ups and consumers.