H1 Lands $40 Million Investment From CVS as Healthcare SaaS Continues to Draw Investor Interest

While many startups founded before the AI boom are finding it harder to attract investor attention, healthcare data platform H1 believes its business model places it in a different category.

Ariel Katz, co-founder and CEO of the nine-year-old company, argues that not all software-as-a-service businesses face the same challenges in the age of generative AI.

“If you’re a workflow SaaS company, you could vibe code that,” Katz said. In his view, what AI cannot easily replicate is a company built around proprietary data. H1’s core business centres on collecting and providing detailed information about physicians to pharmaceutical companies, health insurers, and hospital systems.

While that perspective naturally aligns with H1’s business interests, Katz believes it reflects a broader reality about the value of unique healthcare datasets.

“I don’t worry about Claude ever doing what we do,” Katz said, referring to Anthropic’s AI model. Instead, he sees AI developers as potential customers, arguing that the physician data H1 has accumulated globally could become increasingly valuable for training and improving future AI systems.

CVS Health Ventures appears to share that confidence. The venture capital arm of healthcare giant CVS/Aetna has led a new $40 million investment in H1, providing fresh backing for the company’s continued expansion.

According to Katz, H1 was not actively seeking new funding. The company became cash-flow positive and EBITDA profitable last year and expects revenue growth of more than 40% this year. However, the opportunity to partner with one of the world’s largest healthcare organisations was difficult to pass up.

Despite those strong fundamentals, Katz acknowledged that many traditional SaaS businesses have struggled to attract attention as venture capital firms increasingly focus on AI startups and rapidly rising valuations in the sector.

H1 was last valued at $750 million in November 2021 when it raised $100 million in funding during the height of the pandemic-era technology boom. Altimeter Capital led that round.

Like many companies that raised capital before the market downturn in 2022, H1 has shifted its focus toward profitability and operational efficiency. The company has also expanded through strategic acquisitions, purchasing smaller competitors and complementary businesses to strengthen its platform and market position.