Sifted - Is the NHS ready for AI?

Good morning there,

Workforce shortages, rising costs and ageing populations: they’re all big problems for every healthcare system in the world. 

In the UK, the powers that be hope to use AI to help tackle those challenges — but routes to market for healthtech upstarts are still scarce. 

Today, I find out exactly where startups are looking to deploy AI in the NHS — and the hurdles they face rolling out their products. 

Elsewhere, we track down the 15 Monzo employees who have become paper millionaires thanks to their shares in the scaleup and there’s a new solo GP fund in Europe. Also, FlexAI, which is building software to help AI developers make use of chips from multiple providers, has raised $30m.

— Kai Nicol-Schwarz, reporter

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Is the NHS ready for AI?

Tech enthusiasts love to wax lyrical about how AI could boost efficiency and cut costs in practically every industry under the sun — but in many ways, few could do with a sprinkling of AI magic more than healthcare. 

Beset by workforce shortages, rising costs as well as the strains of treating growing and ageing populations, the global healthcare sector has come under increasing pressure over the past few years. 

So, do the powers that be think AI could help?

Some clearly do. Last year, the EU announced it would invest $220m in testing AI solutions — including those in healthcare. 

In 2019, the UK government announced it would invest £250m in an AI lab to develop new tech for use in its public health service, the NHS. The funding would also be used to run several support programmes for startups to help develop and trial their AI tools in clinical settings. Five years on, it’s invested £123m into 86 technologies. 

But we’re years away from widespread deployment of AI in the NHS.

There’s a good reason for that: rigorous clinical validation of new technologies takes time. “If you make a single mistake, that could be a life,” says Peter Kecskemethy, CEO and cofounder of UK startup Kheiron Medical Technologies, which is developing AI software to help doctors screen for breast cancer. “You can’t just have peak performance in the lab, you need to make sure that anywhere you install that software, it has a very high performance.”

Kheiron was approved as a medical device in 2018. Over the past six years, it has carried out two large trials, a clinical study and 16 service evaluations at individual NHS sites, alongside a planned pilot programme across 17 hospitals later this year, costing “millions”. 

In that time, the startup has demonstrated that its software could reduce the number of missed early-stage breast cancers — which it estimates could save 2k lives a year if rolled out through the NHS — and reduce clinicians' workload by 30-45%.

And yet it still hasn’t inked a big commercial deal with the NHS — although it’s hopeful one will be signed next year. 

But even with clinical validation, there are still barriers to adoption.

“The challenge we face is commissioning and adoption pathways aren’t in place,” says Sarah Kerruish, chief strategy officer at Kheiron. The NHS is a complex beast, made up of hundreds of trusts and dozens of integrated care systems overseeing certain regions in England — and technology needs to be sold to each one separately. 

“Some new tech comes in, it produces some value in one part of the organisation, but it’s not recognised elsewhere where the payment would come from,” says Kecskemethy. “That makes discussions complicated.”

If the UK government is serious about using AI to breathe new life into its creaking health system, it needs to sort out these selling and scaling problems. 

Plenty of startups aren’t happy to wait as long as Kheiron and are already taking their products to market elsewhere — particularly the US, Kecskemethy tells Sifted.

Reader, I want to hear from you. What does the UK need to do to ensure the best healthcare AI solutions are adopted by the NHS? Do you work for a startup that has had to turn to overseas markets to commercialise AI products for the health sector? Get in touch and let me know.

— Kai Nicol-Schwarz, reporter

🇨🇭 Swiss solo GP Edoardo Ermotti has closed a $30m fund to back B2B SaaS startups. The fund, 14Peaks Capital, will support companies in Europe and the US, with a specific focus on fintech and the future of work. 

• Ermotti joins a growing list of solo GPs in Europe. There are over 20 investors who’ve raised funds solo on the continent, by Sifted’s count, and we know of several others keeping a low profile.  

🍟 Paris-based startup FlexAI has raised $30m to help address the demand bottleneck for AI chips — and challenge Nvidia’s dominance of the sector.

• FlexAI is developing software that makes it easy for developers to build their AI systems on a range of chips from other providers like Intel and AMD. 
• The round was led by Alpha Intelligence Capital (AIC), Elaia Partners and Heartcore Capital.

📣  A new CEE AI lobby group has launched. Almost 50 Polish companies, including dozens of startups such as Finnish-Polish space scaleup Iceye and fintech Finiata, have joined the country’s AI Chamber. The newly-formed lobby group aims to promote responsible development of AI across central and eastern Europe. 

• In the next year, the group wants to have four times as many members from across the region. It will help them network, lobby for more favourable policies and better understand European and national regulations around AI. 

🔌 Regulators ease up on EV charger startup Easee. Following a ban on Norwegian startup Easee’s best-selling EV chargers in Sweden early last year, the Swedish National Electrical Safety Board (ESV) has decided that none of its chargers that have already been sold need to be recalled.

• The company, which has a new EV charger model on sale in Sweden, still needs to take action to make sure chargers that have already been sold won’t catch fire.
• Easee lost 97% of its 10bn NOK (€840m) valuation following the ban — and was forced to let go of 70% of its workforce (350 staff) last year.

🤑 15 former and current Monzo employees have been made millionaires by their shares.

💸 Is crypto for e-commerce the new future of payments? (Sponsored by CoinsPaid)

🧠 Meet five startups using AI for good. (Sponsored by Microsoft)

🇦🇹 Meet the Viennese innovators who are pioneering the circular economy. (Sponsored by ViennaUp)

Karlsruhe, Germany-based Octomind, which uses AI to test website code for bugs, raised $4.8m in seed funding. Cherry Ventures led the round.

London-based Fundpath, a software tool that helps wealth managers share information with asset managers, raised £2m in funding from Fuel Ventures.

London-based Sorted, which helps waste management companies sort recyclable materials more efficiently, raised £1.7m in seed funding. Pi Labs led the round and was joined by investors including Archipelago Ventures, Circular Plastics Accelerator, Conduit Connect and Antler.

Warsaw-based ForActive, which is developing a payments and communication app for sports and wellness instructors, raised $1.6m in pre-seed funding. Movens Capital and ff Venture Capital co-led the round. 

Brno, Czech Republic-based Talsec, which provides cybersecurity tools to prevent hackers from attacking mobile apps, raised €1m in funding from Dig Ventures and DEPO Ventures.

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