Reputable sources have revealed that Sword Health, a leading provider of virtual physical therapy powered by artificial intelligence, has raised $130 million in a new funding round while allowing employees to sell $100 million worth of shares. This significant capital injection has seen the company’s valuation soar to $3 billion, representing a 50% increase from its previous $2 billion valuation in late 2021.
Founded in 2015, Sword Health uses AI to deliver personalized musculoskeletal and pelvic health treatment plans remotely. Through its virtual physical therapists named Phoenix, the platform analyzes customer movements during prescribed exercises to provide tailored feedback and ensure effective recovery. Sources indicate the company is on track to achieve profitability by the end of the year despite challenging economic conditions.
According to Sword Health’s CEO and founder Virgílio Bento, the new funding was not necessary from an operational standpoint. However, updating the valuation provided an opportunity to signal continued strong growth to customers, partners and the investment community during a period of uncertainty in the wider market. A successful secondary round allowing earlier investors and employees to cash in share holdings was oversubscribed, leading the company to opportunistically raise additional capital at the higher price point.
This rapid rise in Sword Health’s worth highlights the promise of AI in transforming healthcare delivery. By demonstrating clear value through outcomes data with insurer clients like UnitedHealthcare, the startup has cemented its leadership in virtual therapy. Rivals like Hinge Health which laid off staff earlier in the year will face an even tougher competitive landscape. For patients, the platform’s engaging and personalized experience driven by the AI assistant Phoenix is revolutionizing access to important physical and mental healthcare services.
Key industry observers see Sword Health targeting an initial public offering as soon as 2025 if momentum continues apace. With over $340 million in total funding from backers such as Khosla Ventures and General Catalyst, the company appears well placed to scale globally. Shareholders, employees, customers and the broader virtual healthcare sector will be watching Sword Health’s next moves closely as a leader shaping the industry’s future.