Healthify raises $20 million to fuel US expansion

AI-focused healthtech startup Healthify has raised fresh capital of $20 million, led by existing investor Khosla Ventures, and LeapFrog Investments with new investor Claypond Capital (family office of Indian healthcare billionaire Ranjan Pai). The new $20 million adds to an earlier tranche of $30 million, which included $5 million in venture debt, raised in 2023.

The funding comes as the company is set to launch its app in the US markets by the end of this year and a majority of the capital raised will be used to fuel its global expansion plans with a primary focus on the US. 

“We have done extensive alpha testing of our AI products here and we've concluded our alpha testing of our coaching product as well. We're hoping to be able to release our beta app before the year ends,” Tushar Vashisht, cofounder and CEO of the company, told Mint.

Also Read: Healthify lays off 150 employees to make India business profitable

Healthify has an opportunity to win in the US because its offerings are cheaper than those available there, according to Vashisht.

“The US right now is a very high-cost basis market. A single nutritionist session costs $140, whereas our programmes operate at between $5 and $20 a month. Our comparable US prices are at $80 a month or $50 a month or $100 a month. We have this tremendous opportunity to play at lower cost,” he said. 

The company has been able to drive costs lower because it is built out of India and on the back of strong AI capabilities, according to Vashisht.

Also Read: Healthify maps a global run amid profit chase

“We have very high clients-to-coach ratio. Our AI assists our coach in building our meal plans and in responding to messages. When somebody needs to use a human accountability, we also have that, and they are also helped by Ria (Healthify’s AI nutritionist) at the backend to do their job,” he said.

On the kind of business it expects from the US markets, Vashisht noted that in the first couple of years, it will be a smaller percentage but five years from now, the US has the potential of being hundreds of millions of dollars in revenue. “It will be the dominant revenue and I'm confident that we can build a global billion-dollar company,” he said.

While US will be the primary focus in the near term, the company wants to expand to other geographies eventually. 

50-country launch

“With AI, we can do a 50-country launch as well, without that much of resistance. That is the mission that we want to chase,” he said.  

The company will become cash-flow positive in India in FY25 and plans to grow the domestic business profitability while the majority of the focus goes into building the US business, according to the cofounder. 

Healthify posted a revenue of about ₹229 crore in FY23, an increase of 24% over FY22. Its losses decreased from ₹157 crore to ₹142 crore during the same period.

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