By Hamza Faisal
Abby Care, a San Francisco startup that turns family members into trained, paid caregivers, has raised $82 million in Series C funding, the company confirmed this week. The round was led by digital-health investor Transformation Capital, with new backers CVS Health Ventures, Frist Cressey Ventures, and Pivotal Ventures joining.
Existing investors Khosla Ventures, Thrive Capital, and Sequoia Capital all returned. Fortune first reported the raise on October 15; the company announced it publicly this week. Founded in 2022 by chief executive Havi Nguyen, Abby Care operates as a Medicaid provider in eight US states: Colorado, Florida, Georgia, Indiana, Massachusetts, New Jersey, Pennsylvania, and Tennessee. Its AI-powered platform trains and certifies relatives as paid caregivers for children, older adults, and people with disabilities who have complex medical needs, pairing them with clinical oversight and real-time visibility into the care delivered at home.
A different answer to the caregiver shortage
The United States is facing one of the largest healthcare workforce shortages in its history, with a rapidly aging population and long waitlists of vulnerable children needing care. Traditional private-duty nursing programs fill only about 65% of authorized caregiving shifts because agencies cannot hire and retain enough outside staff.
Abby Care's thesis flips the model. Instead of sending an outside agency worker into the home, it pays the people already doing the work: family members. "When you leverage the person who already knows a family member best and is consistently there for them, and combine that with clinical oversight, technology, and real-time visibility, you can deliver care that is more proactive and preventative than other traditional care models," Nguyen said in the company's funding announcement.
The company says the approach works. Figures shared with Fierce Healthcare show members had more than 40% fewer reported hospitalizations in year one, and the number of patients served has grown more than fivefold since Abby Care's $35 million raise in August 2025. This Series C is more than double that earlier round.
Where the money goes
Abby Care plans to use the fresh capital to expand into new states, continue investing in its AI and clinical research, and grow partnerships with health plans to increase program integrity and access to home healthcare. The company's RN care managers supervise the trained family caregivers, while its platform gives health plans visibility that care is being delivered as intended.
The investor roster signals why the model has traction. CVS Health Ventures' participation brings a strategic insurer into the round; Medicaid-funded home care is a direct lever on an insurer's own cost base, and filling the staffing gap reduces costly emergencies.
The AI bet behind the bet
Abby Care describes itself as AI-native: its training platform is powered by artificial intelligence, and care teams get real-time data capture from the home, which helps catch problems early and proves to states and health plans that care is delivered as promised.
Investor interest in the round says something broader about where venture dollars are heading as the AI funding boom matures. Rather than backing another foundation model, firms like Transformation Capital, Sequoia, and Khosla are backing AI wrapped around a real-world labor problem: millions of American households already provide unpaid care for relatives, often at a steep financial cost.
By Hamza Faisal
