SAN FRANCISCO–(BUSINESS WIRE)–Vitalize, the AI-native platform that helps health systems manage labor and capacity in real time, today announced a $31 million Series A led by Oak HC/FT, with participation from Norwest, .406 Ventures, Constellation Ventures, Y Combinator, Rock Health Capital and MemorialCare Innovation Fund. The funding will be used to accelerate growth and further the company’s mission to unlock healthcare’s full capacity.
Labor is the biggest expense category in the American healthcare system, accounting for 50-60% of hospital operating costs and approaching $1 trillion in annual spend nationwide. Hundreds of billions of those dollars are lost each year to two core operational inefficiencies – how systems manage their workforce and how they plan capacity.
On the workforce side, clinical leaders spend up to half their day in “firefighting mode,” including building schedules manually, chasing HR compliance and rebuilding plans based on the changing capacity of the department. Without a way to forecast demand or automate the response, a single large health system can spend more than $100 million a year on premium overtime and agency labor just to keep up.
Capacity planning is the other half of the equation. Hospital revenue depends on matching patient demand to available beds and staff, yet most systems still manage beds and staffing in separate silos. This can inadvertently drive up length of stay, leave beds unused and lengthen the wait for patients. The strain is most visible in the emergency room, where admitted patients “board” for hours waiting on a bed and a nurse to free up at the same time, driving patients to stay roughly 30% longer than needed.
“With financial pressure mounting, operations still running on paper and Excel, and frontline leaders burning out, addressing labor and capacity challenges isn’t a nice-to-have – it’s essential to keeping our healthcare systems running,” said Brant Heise, Managing Partner of the MemorialCare Innovation Fund.
Vitalize works like an always-on “air traffic control” system for the healthcare workforce, coordinating staffing and capacity across the entire enterprise. Vitalize’s AI automates the most manual scheduling tasks for clinical leaders, while forecasting demand and orchestrating staff across thousands of beds in real time. With every shift it manages, the platform learns a system’s specific rules and sharpens its recommendations. And because it integrates natively with leading EMR and time-and-payroll systems, it replaces the 10-plus patchwork tools clinical teams juggle today to run staffing, scheduling and capacity planning.
“Health systems are still running their single largest cost center on spreadsheets and group texts. That drains the budget, burns out frontline teams, and hurts patients,” said Veeraj Shah, CEO and co-founder of Vitalize. “We built Vitalize to move labor and capacity from manual and reactive to automated and predictive. We’re helping leading health systems save tens of millions of dollars on labor while fixing the No. 1 pain point for their frontline staff.”
Today, Vitalize manages millions of shifts a week across dozens of enterprise health systems, saves clinical leaders more than 2,000 hours daily, and delivers measurable ROI by quickly cutting premium labor spend. Beyond financial ROI, Vitalize’s AI is returning clinical leaders and operators from the office to the bedside in a meaningful way.
“Within weeks of deploying Vitalize, our clinical leaders were spending 50% less time on manual staffing and scheduling,” said Dan Ireland, EVP and Chief Nurse Executive at Rochester Regional Health. “This partnership will build a stronger workforce, drive improved finances and better outcomes for the patients and communities we serve.”
The returns have also come unusually fast for enterprise healthcare.
“Vitalize’s ROI exceeded our expectations,” said David Pereles, Chief Information Officer at St. Luke’s Health. “In just 12 weeks, we saw a 54% reduction in premium labor spend across overtime and agency costs, and we’re moving quickly to roll it out across the system.”
Vitalize will use the funding to build their growth and deployment teams, and invest in their AI models for patient throughput optimization. “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. “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.”
About Vitalize
Headquartered in San Francisco, Vitalize is an AI-native platform that helps hospitals optimize their labor and capacity operations. By integrating natively with existing time-and-payroll and EMR systems, Vitalize automates complex workforce and capacity-planning processes across inpatient, ancillary, and ambulatory care settings. For more information, visit vitalize.care.
About Oak HC/FT
Oak HC/FT is a venture and growth equity firm specializing in fintech and healthcare. Using partnership as a foundation, Oak HC/FT guides companies and founders at every stage, from seed to growth, to create businesses that make a measurable and lasting impact. Founded in 2014, Oak HC/FT has invested in 120 portfolio companies and has more than $7 billion in assets under management. Oak HC/FT is headquartered in Stamford, CT, with an office in San Francisco, CA. Learn more at www.oakhcft.com.
Contacts
