Vitalize, an AI platform that helps hospitals manage labor and capacity, announced Tuesday that it raised $31 million in Series A funding.
The platform functions like an “air-traffic control” system for the healthcare workforce, according to Veeraj Shah, co-founder and CEO of Vitalize. It coordinates scheduling, staffing and patient capacity. It supports processes across inpatient, ancillary and ambulatory care settings.
“Labor accounts for 50-60% of hospital operating costs, yet many health systems still manage staffing and capacity through manual, disconnected processes,” Shah told MedCity News. “Vitalize is helping move these operations from manual and reactive to automated and predictive, reducing administrative burden and unnecessary labor costs while improving patient flow.”
The Series A round was led by Oak HC/FT, with participation from Norwest, .406 Ventures, Constellation Ventures, Y Combinator, Rock Health Capital and MemorialCare Innovation Fund. Vitalize declined to share its total funding to date.
“Labor is a nearly trillion-dollar line item for U.S. health systems, making it one of the largest and most underpenetrated software markets in healthcare,” said Vig Chandramouli, partner at Oak HC/FT, in a statement. “What sets Vitalize apart is that it doesn’t just surface insight – it drives action, and the ROI shows up fast. We’re thrilled to back co-founders Veeraj Shah and Sanketh Andhavarapu, and a founding team with the clinical, operational, and technical depth to capture a market this size.”
The financing will be used to build Vitalize’s growth and deployment teams, as well as to invest in their AI models, Shah said.
The company’s platform is achieving results, according to some clients. St. Luke’s Chief Information Officer David Pereles said the company saw a 54% reduction in premium labor spend across overtime and agency costs in just 12 weeks. Rochester Regional Health Chief Nurse Executive Dan Ireland said its clinical leaders are spending 50% less time on manual staffing and scheduling.
Shah said the company’s ultimate goal is to “unlock healthcare’s full capacity.”
“Our thesis is that the workforce is the key to unlocking the hardest operational challenges in healthcare delivery and enabling our system to see more patients,” he said. “After labor operations, Vitalize will move to capacity management and supply chain optimization to serve as an intelligence layer for healthcare operations.”
Photo: Richard Drury, Getty Images
