Sword Health Secures $40M at $4B Valuation, Delays IPO Plans Until 2028

TL;DR

• Sword Health raises $40 million at a $4 billion valuation, up from $3 billion last year.
  
• Despite a $240M revenue run rate, Sword delays IPO until at least 2028, citing scale ambitions.
  
• AI-powered platform Phoenix aims to expand into cardiovascular, gastrointestinal, and speech care.
  
• General Catalyst leads the round; existing backers include Khosla Ventures, Comcast Ventures, and others.
  
• Sword plans a $50M round at $5B valuation in 2026, maintaining a symbolic funding trend.
  

Sword Health’s Strategic $40M Raise: Timing the Market

Sword Health, a digital health unicorn using AI-powered virtual care, has secured $40 million in fresh capital, bringing its total funding to $380 million. The round was led by General Catalyst and follows a consistent growth trend from its $3 billion valuation in 2024 to $4 billion in 2025.

CEO Virgílio Bento, who founded the company over a decade ago, shared with TechCrunch that the raise was not out of necessity—Sword is cash-flow positive—but rather for two strategic reasons:

1. To refresh the company’s valuation in the private market.
   
2. To ensure liquidity for strategic acquisitions as Sword expands its care offerings.
   

Sword Health Growth Metrics & Market Indicators (2024–2025)

IPO? “Maybe 2028,” Says Bento

While Sword previously considered a 2025 public offering, Bento has shifted that outlook dramatically. Despite the successful IPOs of Hinge Health and Omada Health, Bento now targets 2028—and even that is tentative.

“If you ask me why we shouldn’t IPO, I can give you 10 reasons. If you ask me why we should IPO, I cannot find one,” Bento told TechCrunch.

His skepticism stems from concerns around public market volatility, operational distractions, and the availability of ample private capital. Bento cites examples like Databricks, which raised $10 billion without going public.

Phoenix: Sword’s AI Expansion Engine

At the heart of Sword Health’s long-term strategy is Phoenix, the company’s AI care specialist. Initially designed to assist in musculoskeletal and pelvic health, Phoenix is now targeting:

• Cardiovascular care
  
• Gastrointestinal conditions
  
• Speech therapy
  
• Mental health
  

This AI-first expansion aligns with Sword’s thesis of creating a scalable, intelligent healthcare delivery platform.

“I want to IPO when I have lots of different proof points at scale in many different care verticals,” Bento said.

Liquidity Without Wall Street

While many startups go public to offer liquidity to employees and investors, Bento believes secondary markets now offer equivalent flexibility.

Sword Health is planning a tender offer next month, allowing early shareholders and team members to sell shares privately—further reducing pressure to list publicly.

“Liquidity doesn’t require public listing anymore,” Bento said. “There’s a growing infrastructure for private liquidity.”

Valuation Playbook: $30M → $40M → $50M?

Bento hinted at a symbolic funding roadmap:

• 2024: $30M at $3B valuation
  
• 2025: $40M at $4B
  
• 2026 (Projected): $50M at $5B
  

“I like the numerical symmetry. I think it’s fun,” Bento quipped in the TechCrunch interview.

While whimsical, the pattern reflects both confidence and clarity in Sword’s scaling trajectory.

Strategic Investors Align With Long-Term Vision

In addition to General Catalyst, Sword’s backers include:

• Khosla Ventures
  
• Comcast Ventures
  
• Lince Capital
  
• Oxy Capital
  
• Armilar Venture Partners
  
• Indico Capital
  
• Shilling Capital
  

Their continued support, despite Sword’s decision to delay IPO plans, underscores belief in its private-market potential and AI-driven expansion.

The Bigger Picture: Digital Health at an Inflection Point

Sword Health’s story is part of a broader trend in healthcare where AI, virtual care, and chronic condition management are converging. As more players like Carbon Health and Forward evolve, investors and founders alike are reconsidering the role of public markets in healthcare innovation.

Bento’s “educational journey” through discussions with bankers and public CEOs may have led him away from the Nasdaq—for now—but Sword’s trajectory suggests a discipline-first, product-led growth approach is very much alive.