AI Startup Raises One Of The Biggest Series A Rounds Ever For Middle Eastern Company

Abu Dhabi-based AppliedAI, which helps healthcare companies and insurers automate claims and billing, just raised $55 million in a deal led by G42 with Palantir and Bessemer

Abu Dhabi is best known in tech for bankrolling foreign startups, venture funds and now AI mega projects like OpenAI’s infrastructure Stargate via its massive sovereign wealth funds. But the UAE also has a small but growing AI ecosystem.

One such startup, AppliedAI, which was originally founded in London in 2021 but moved to Abu Dhabi the following year to take advantage of government grants, has now raised one of the region’s largest early-stage venture funding rounds. G42, the AI lab controlled by United Arab Emirates’ national security adviser Sheikh Tahnoon Bin Zayed, has led a $55 million Series A round into the company, along with Palantir, Bessemer Venture Partners, McKinsey, and Accrete Capital. The new funding puts a $300 million pre-money valuation on the startup, which uses a mix of humans and AI to automate back-office jobs.

AppliedAI founder and CEO Arya Bolurfrushan has zeroed in on highly regulated insurances like healthcare, insurance and pharma that have mountains of paperwork that need to be manually processed. Among AppliedAI’s current clients are Abu Dhabi’s state-owned health group M42, American law firm Morgan & Morgan and British drug safety monitoring company Qinecsa.

Bolurfrushan’s pitch is that his AI, and human reviewers, can process complex medical billing records or insurance claims faster and more accurately than traditional outsourcing companies like Cognizant, Concentrix and Wipro. Studies suggest that such paperwork and other administrative expenses count for at least 15% of the $4.9 trillion spent on healthcare in the United States annually.

“All our work is what we call high cost of error workflows where often human lives are on the line,” Bolurfrushan told Forbes. “You can’t afford hallucinations and that’s why we have an essential harmony between our AI and human agents.”

Bolurfrushan declined to reveal AppliedAi’s revenue but said that company had processed over 4 million pages of U.S. medical records in the last year alone.

Applied had previously raised $42 million in 2022 from G42 and Dubai’s ruling Al Maktoum family, Bloomberg reported. Bolurfrushan, a former Goldman Sachs banker, told Forbes the new cash would be used to further develop its AI tools, and expand its team to work with more clients in the United States and Europe.

G42, Abu Dhabi’s flagship AI project, received its own funding boost last year when Microsoft invested $1.5 billion to take a minority stake. That investment came as part of a deal for G42 to divest from China and end its work with Huawei over fears from American lawmakers that this could allow China’s tech giants to access U.S. AI technology and chips.

One investor in the deal, London-based venture fund Accrete, was also cofounded by Bolurfrushan.

The deal marks Bessemer’s first investment in the UAE in what is one of the region’s largest Series A rounds for a startup. “What AppliedAI has built enables the automation jobs to be done faster and cheaper but with a human in the loop,” Sofia Guerra, vice president of Bessemer Venture Partners, told Forbes.