Sword Health lands $40M to expand AI care into mental health, hits $4B valuation

Sword Health, an AI health tech startup known for helping people manage pain through digital tools, has raised $40 million to grow its footprint in mental health and accelerate its expansion plans.

The new round, which gives the company a $4 billion valuation, was led by General Catalyst. Other investors include Khosla Ventures, Comcast Ventures, Lince Capital, Oxy Capital, Armilar, Indico Capital, and Shilling. According to PitchBook, Sword had raised over $450 million as of last September.

The company says the funding will be used to ramp up acquisitions, support international growth, and build out AI models that support different areas of care.

With $40M in fresh funding, AI Startup Sword Health Brings Always-on Mental Health Care to Market

Alongside the announcement, Sword introduced Mind, its latest product aimed at tackling the long-standing issues around mental health care. Mind brings together AI, wearable hardware, and licensed clinicians to deliver round-the-clock, personalized mental health support, moving away from the outdated model of waiting days or weeks for a therapy session.

The concept is straightforward: mental health issues don’t stick to a schedule. So why should I care?

With Mind, users get access to a wearable called the M-band, which tracks things like heart rate, sleep patterns, and environmental signals like light exposure. That data is fed into an AI assistant that works with human therapists to offer personalized support, including traditional talk therapy, when needed.

The system isn’t fully automated—clinicians are always involved. For example, if a user experiences a spike in anxiety, the AI might flag that and suggest a physical activity. A clinician can then review and either approve the recommendation or suggest a better option.

“You have an anxiety issue today, and the way you’re going to manage is to talk about it one week from now? That just doesn’t work,” Sword CEO Virgílio Bento told CNBC. “Mental health should be always on, where you have a problem now, and you can have immediate help in the moment.”

Bento emphasized that AI isn’t replacing therapists—it’s supporting them by helping spot moments that matter. “AI plays a very important role, but the use of AI—and I think this is very important—needs to be used in a very smart way,” he said.

Sword is already working with early design partners to test Mind, and Bento says the feedback so far has been positive. Some clients had been waiting for the product for months.

“We believe that it is really the future of how mental health is going to be delivered in the future, by us and by other companies,” Bento added.

Founded in Portugal and now based in New York, Sword originally made its name with digital tools for physical therapy, pelvic health, and movement support, offering alternatives to opioids and surgery. Its products are available through employers or health plans.

The funding comes as digital health shows signs of life after a tough couple of years marked by economic pressure and investor pullback. Earlier this month, Omada Health made its Nasdaq debut, and Hinge Health followed with a listing on the NYSE. Both are navigating mixed reactions from the public markets.

With Mind, Sword is betting that mental health care can shift from something people schedule when they’re already in crisis, to something continuous, accessible, and adaptive. If it works, it could mark a major step forward for a sector that’s long struggled to deliver care when people actually need it.

“At General Catalyst, we back companies driving meaningful change in healthcare, and Sword Health sits squarely at the forefront of that transformation,” said Chris Bischoff, Managing Director at General Catalyst and Sword board director. “By fusing sophisticated AI with human clinical expertise, Sword is re-imagining the entire care continuum—from physical pain care to today’s launch of Mind for mental health—expanding access, improving outcomes, and lowering costs at global scale. We’re proud to support Sword as it accelerates the shift toward truly AI-first healthcare.”