The Race to Build a New Generation of Healthcare Software
A startup out of Munich, Germany called Avelios has ambitions to build a new kind of end-to-end administrative system, leaning into more modern tooling using AI and cloud services. On Thursday, it announced €30 million ($31 million) in Series A funding as it gains momentum.
Covid Beginnings
Avelios is taking a ground-up approach to the world of healthcare systems, aiming at a market that has up to now largely been built around siloed implementations that serve specific purposes, and have thus had to be specially integrated to work together (and might have never worked that well together as a result).
As Albrecht describes it, Krammer had been working as a doctor during the COVID-19 pandemic, when the creaky nature of the German healthcare system was laid bare to him.
“He ran through hospitals and spent almost all of his time counting patients by hand and then reporting the results to authorities by hand,” recounted Albrecht. Krammer then consulted with Jakob, who he knew from before, on how to possibly build something to improve reporting to gain better insights into emerging trends.
Investor Attention on Pragmatic Wins
Sequoia’s attention started out by way of an introduction from Revent, one of the seed investors.
“Avelios was under the radar building this system for four years,” Anas Biad, Sequoia’s partner leading on the investment, said in an interview. He said he was completely surprised to discover once he started to look just how many customers they’d picked up despite being so quiet.
Conclusion
Avelios is making a big and ambitious swing here, but it’s doing so also with a lot of pragmatism. Hospitals are not typically going to turn around and rip out entire systems wholesale to update, not least because they have to continue operating, but also because of the cost.
FAQs
Q: What is Avelios’ approach to building a new healthcare system?
A: Avelios is taking a ground-up approach, aiming at a market that has up to now largely been built around siloed implementations that serve specific purposes, and have thus had to be specially integrated to work together.
Q: What is the funding amount raised by Avelios?
A: Avelios has raised €30 million ($31 million) in Series A funding.
Q: Who are the investors in Avelios?
A: Sequoia is leading the round, with investors from Avelios’ seed round also participating, including High-Tech Gründerfonds, Revent, and individual investors.
Q: What is the significance of SAP’s shift towards cloud services?
A: SAP’s shift towards cloud services has meant it has shifted away from building, and helping to support long-term, point-specific solutions for particular verticals, including healthcare, leaving a gap in the market for companies like Avelios.
Q: What is Avelios’ strategy for landing customers?
A: Avelios is taking a modular approach, allowing customers to land and expand incrementally, rather than having to rip out entire systems and replace them with new ones.
