Orlando-based Care.ai’s recent $27 million funding deal was made possible by another Orlando tech company: Luminar Technologies Inc.
Why this story matters: Funding deals are important for technology startups, as they enable entrepreneurs to hire more workers and further develop their businesses. Care.ai’s growth means more high-tech, high-wage jobs in Central Florida.
San Francisco-based investment firm Crescent Cove Advisors LP has been an investor in autonomous vehicle sensor firm Luminar (Nasdaq: LAZR) since 2019. Luminar co-founder and Chief Technology Officer Jason Eichenholz is a friend and supporter of Care.ai founder and CEO Chakri Toleti, and Eichenholz previously said Care.ai “could be Orlando’s next unicorn.”
The connection to Luminar “sparked a conversation” with Crescent Cove, which culminated in a funding deal for health tech startup Care.ai, Toleti told Orlando Inno. As a result of the deal announced Nov. 21, Care.ai will scale its local manufacturing as it aims to hire another 100 workers by the end of 2023, Toleti said.
Care.ai’s artificial intelligence-powered sensors and monitoring platform enable smart, real-time patient monitoring in hospitals, nursing homes and assisted-living communities. Care.ai’s technology is in use in 1,500 U.S. facilities.
Given that Care.ai has a strong client footprint, the company’s focus will be to scale its local manufacturing operations and integrate its patient monitoring technology more deeply with its existing customers, Toleti said.
Toleti has been a longtime proponent of using a domestic manufacturing plant. “We invested in a local manufacturing facility to avoid the volatility of the international supply chain. On top of that, it was to scale the business in terms of the significant demand.”
Meanwhile, Care.ai — a 2022 Orlando Inno Startup to Watch — is on a trajectory to grow its team of 100 employees to 200 by the end of next year, Toleti said. Those new roles will encompass virtually all functions at the company, namely developers and engineers.
Care.ai is not Toleti's first attempt at building an innovative health care company. He successfully started three other firms in the area. His last business, patient communication app HealthGrid Corp., was bought for $60 million in 2018.
In fact, the track record of Toleti and his team of building innovative businesses piqued the interest of Crescent Cove Advisors, founder and Chief Investment Officer Jun Hong Heng said in a prepared statement. “Through AI and smart technology, Care.ai improves the lives of both care teams and their patients.”
Meanwhile, startup investment got off to a historic start in metro Orlando during the first half of the year, but investment activity tumbled in Q3 as startup investment declined nationwide.
Orlando-area companies collectively raised $22.6 million last quarter, down 92.9% from $320.7 million in 2Q and down 85.8% compared to $159.9 million in 3Q 2021, according to PitchBook and the National Venture Capital Association.
Still, Central Florida’s tech ecosystem has scored a few sizable funding rounds so far in 4Q, including $15 million-plus for Winter Park-based TMRW Sports and $33 million for Orlando-based OneRail.
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