SmarterDx - Strategic Investment
When it comes to hospital revenue, “close enough” is the difference between +$2 million and a denial that lands in a black hole. SmarterDx didn’t just notice that problem, they built a clinical AI stack that sees the whole chart, not just the part that fits the narrative. Now they’ve locked in a strategic growth investment from New Mountain Capital to go deeper. Not every round needs a drumroll to matter. Some just speak loud in results.
Started in 2020, SmarterDx came out of a problem that’s haunted healthcare for decades: incomplete documentation costing hospitals millions in missed revenue and murky quality scores. Dr. Michael Gao, who led AI initiatives at NewYork-Presbyterian, saw it firsthand. He teamed up with Dr. Josh Geleris, a physician-scientist with NIH and DOD-funded research, and healthcare analytics specialist Nathan Perilo. Together, they built a platform that analyzes 30,000+ datapoints per patient chart, flags documentation gaps before claims go out, and auto-generates evidence-backed appeal letters when they do.
The result? Hospitals using SmarterDx are pulling an average of $2 million in net new annual revenue for every 10,000 discharges. Unlike most of the “AI in healthcare” hype train, these guys built a contingency-based model that gets paid when it delivers. Real ROI, not theoretical potential. That’s a 5:1 return from day one. Which explains why over 40 leading health systems and 180+ hospital sites have signed on. SmarterDx isn’t just another vendor, they’re becoming an extension of the CDI and revenue integrity teams, offering full-chart audits and physician-designed AI that actually gets how care is delivered.
And let’s talk talent growth. Team size grew 4x in a year. That’s not a hiring spree, that’s scaling to meet demand. Their 100% client retention and KLAS score of 98? Rare air, especially for a startup. And the ecosystem noticed: Transformation Capital led their $50M Series B last year, backed by returning believers Bessemer Venture Partners, Flare Capital Partners, and Floodgate Fund. Now New Mountain Capital steps in to push the platform further. This isn’t a one-product play. It’s an infrastructure-level AI bet for hospitals looking to turn admin drag into operational lift.
From Smarter Prebill™ that audits every detail pre-claim to SmarterDenials™ that makes denial management a recoverable science, SmarterDx isn’t here to disrupt. They’re here to optimize.
Props to Dr. Michael Gao, Dr. Joshua Geleris, and Nathan Perilo for building one of the most effective clinical AI systems in the game. And respect to New Mountain Capital for spotting the real signal in a space full of static.