Frist Cressey Ventures raises $425M for Fund IV, pushes total assets toward $1B to fuel AI healthcare startups

When a former U.S. Senate Majority Leader closes a $425 million venture fund in one of the most scrutinized sectors in America, investors pay attention.

Frist Cressey Ventures, co-founded by former Senator Bill Frist, MD, has closed an oversubscribed $425 million Fund IV to fuel AI healthcare startups, pushing the firm’s total assets under management close to $1 billion. The raise marks a decade since the healthcare-focused venture firm launched in 2016 with a thesis that still feels timely: use technology to improve patient outcomes rather than simply inject more capital into a strained system.

The new fund drew support from both new and returning limited partners, including major healthcare organizations such as The Cigna Group Ventures. Strategic LPs tied to FCV collectively serve more than half of the U.S. population, giving the firm unusual access to operators, health systems, and payor networks. Roughly a quarter of FCV’s portfolio companies count at least one strategic partner as an investor, a signal that these relationships are more than symbolic.

“This milestone reflects the clarity of purpose, conviction, and deep commitment of our team, investors, and portfolio companies, all united by a shared mission to advance innovation in healthcare that improves lives and keeps patients at the center of everything we do,” said Sen. Bill Frist, MD, Co-Founder and Managing Partner, Frist Cressey Ventures. “As we enter this next chapter, we’re excited to build strong, transformative, and enduring partnerships – and to serve as a trusted partner to the leaders and companies shaping the future of patient-centered care.”

Bill Frist’s Frist Cressey Ventures Raises $425M Fund IV, Brings Healthcare-Focused VC to Nearly $1B AUM

Fund IV continues FCV’s focus on early-stage healthcare companies reshaping care delivery through technology and tech-enabled services, including AI-native models. The firm has made 44 investments to date and recorded 14 exits across value-based care and applied AI. Portfolio names include Ambience Healthcare, Thyme Care, Qualified Health, and Monogram Health, companies that work across oncology care management, AI-governed deployment, and specialty services.

“Frist Cressey Ventures believed in Thyme Care’s model early, before the category was clearly defined, and has stayed committed as we have grown into a category-defining leader in specialty care management,” said Robin Shah, chief executive officer and co-founder of Thyme Care. “The firm has been a close partner and mentor throughout that journey, and its perspective has shaped how we think about scaling patient-centered care to help more people with cancer in more meaningful ways.”

“FCV brings a rare combination of healthcare experience and long-term strategic thinking,” said Justin Norden, chief executive officer and co-founder of Qualified Health. “As we build the operating layer that enables health systems to deploy governed AI across the enterprise, their support has been grounded in a clear understanding of both the urgency and complexity of this moment in healthcare.”

The firm’s first two funds rank in the top five percent of venture capital funds in their respective vintages, according to the company. That performance has positioned FCV as a repeat partner for founders building inside a system where reimbursement, regulation, and policy shape outcomes as much as product design.

Healthcare remains one of the largest segments of the U.S. economy, accounting for nearly 18 percent of GDP. At the same time, cost pressures, clinician shortages, and fragmented care continue to strain patients and providers. Venture capital flowing into early-stage healthcare technology has cooled from pandemic-era highs, yet investors still back firms that show durable performance and strong strategic alignment.

Alongside the fund close, FCV announced the fifth class of the FCV Collective, a curated group of healthcare and adjacent industry executives from organizations including AT&T, NVIDIA, Humana, and UC Irvine. The cohort meets throughout the year to discuss systemic challenges and policy priorities, including visits to Washington, D.C., to engage with lawmakers and administration officials.

That policy connectivity is part of FCV’s identity. Frist, a physician by training, served as Senate Majority Leader and remains closely tied to healthcare legislation circles. For early-stage founders building in areas like value-based care, AI governance, or specialty services, those relationships can shape how companies think about scaling in a heavily regulated industry.

The $425 million raise comes at a moment when AI is reshaping enterprise healthcare, from clinical documentation automation to decision-support systems. Investors are looking past hype and asking harder questions about adoption inside hospitals and payor systems. FCV’s strategy appears focused on companies that can integrate into existing care delivery rather than sit outside it.

Ten years in, Frist Cressey Ventures is nearing the $1 billion AUM mark, with a portfolio spanning value-based delivery and applied AI. Whether Fund IV produces another top-decile outcome remains to be seen, but the firm has clearly secured investor confidence at a time when healthcare venture capital demands discipline.

For founders building in healthcare, access to capital is one piece of the equation. Access to the right networks may matter just as much.