Abridge hits $5.3B valuation, enters AI medical coding
In a striking show of investor confidence, AI health tech startup Abridge has doubled its valuation to $5.3 billion just four months after its previous funding round. The Pittsburgh-based company has secured a $300 million Series E round, led by Andreessen Horowitz with continued backing from Khosla Ventures, according to The Wall Street Journal.
This latest raise follows a $250 million round in February 2025 that pegged Abridge's valuation at $2.75 billion. The rapid growth highlights investor enthusiasm for AI-driven tools in the healthcare sector — particularly those that tackle administrative burdens such as medical note-taking.
Founded in 2017 by cardiologist Dr. Shiv Rao, Abridge has emerged as a leader in the AI-powered medical scribe market, which is becoming increasingly competitive. Its success is attributed to early market entry, strong performance metrics, and crucially, its integration with Epic Systems, the dominant electronic health record (EHR) platform in the U.S.
As of Q1 2025, Abridge reported $117 million in contracted annual recurring revenue (ARR) — a figure that includes signed contracts yet to be fully onboarded. This positions the company well ahead of many competitors in terms of scale and reach.
Abridge's technology, which transcribes and structures doctor-patient conversations in real time, is already in use across over 150 of the largest health systems in the United States. The platform aims to free clinicians from the burden of documentation, allowing them to focus more on patient care.
But the company isn’t stopping there. Alongside the new funding, Abridge announced a significant expansion into medical coding automation — using AI to convert clinical conversations and notes into billable medical codes. This move brings Abridge into direct competition with startups like CodaMetrix, and even challenges features offered by its own partner, Epic Systems.
As healthcare providers face mounting documentation demands and staffing shortages, Abridge’s momentum underscores the growing appetite for automation tools that can boost productivity, reduce burnout, and improve clinical accuracy. With a robust customer base, expanding product suite, and major financial backing, Abridge is positioning itself not just as a tool for transcription — but as a foundational AI infrastructure layer for the future of digital healthcare.
