The Fund Betting That the Poorest ZIP Codes Are the Best Returns
Andy Slavitt ran Medicare. Now he runs a $1.4 billion fund arguing that the patients Wall Street ignores are where the money is - and the math, so far, agrees.
In venture capital, the safe pitch is a patient who pays. Commercial insurance, healthy margins, a customer base that renews without a fight. Town Hall Ventures built a $1.4 billion firm on the opposite instinct. It looks at the parts of the American healthcare system that most investors treat as a warning label - Medicaid rolls, frail seniors, rural counties with one clinic, teenagers who cannot find a therapist that takes their coverage - and it sees the largest underpriced market in the country.
The firm was founded in 2018 in New York by Andy Slavitt, the former acting administrator of the Centers for Medicare & Medicaid Services; David Whelan, a former general partner and CFO at the private-equity firm Accretive; and Trevor Price, founder of the healthcare talent firm Oxeon. The combination was deliberate: a regulator who ran the government's largest insurance programs, a financier who knew how to underwrite complex businesses, and an operator who knew where the founders were. The thesis they wrote down was contrarian to the point of being uncomfortable to say out loud - that serving the underserved could be a driver of returns rather than a drag on them.
The ThesisImpact with a track record attached
Slavitt has said he carries "a little bit of a chip on my shoulder" about how investors sort funds. Say the word impact, and capital gets filed into a bucket where softer returns are expected and forgiven. Town Hall's answer was not to argue about the bucket. It was to post numbers. According to the firm, its debut fund delivered a 33% net internal rate of return, against a median for venture funds of roughly 12%. Eight of its first sixteen investments reached valuations above $1 billion.
That combination is the whole argument. Plenty of firms have mission. A smaller number have a track record. Town Hall's pitch to limited partners is that it is one of the few that can put both on the same page - and that the two are not in tension, because the underserved market is enormous, sticky, and largely uncontested by the funds chasing well-insured patients.
From $115 million to $1.4 billion
The firm has scaled roughly one fund at a time. The 2018 debut fund raised $115 million. A third fund brought in $350 million and pushed total assets past the billion-dollar mark. In October 2025, Town Hall closed Fund IV at $440 million, its largest yet, bringing the firm to about $1.4 billion under management. The new fund is explicitly aimed at AI-native healthcare companies - businesses that use artificial intelligence as a core capability, not a bolt-on feature, to lower cost and widen access.
Fund IV also came with an organizational tell. Alongside general partners Meera Mani, a physician-scientist, and Anna Fagin, the firm named a head of growth and partnerships and put a principal in charge of something called Hatch - an in-house studio that starts healthcare companies from scratch. When the company Town Hall wants to fund does not exist yet, Hatch is the mechanism for building it. That is a different posture than writing checks and waiting.
The exits that made the argument
Skeptics of mission-driven investing tend to go quiet in front of exit tables. Town Hall's portfolio includes Signify Health, the home-based risk-assessment company acquired by CVS Health for roughly $8 billion in 2023, and Landmark Health, an in-home chronic-care provider acquired by Optum for about $3.5 billion in 2021. Its earlier bet on Cityblock Health, which builds care for low-income and Medicaid populations, has been valued at roughly $6.2 billion. Thyme Care, an AI-assisted cancer navigation company that serves Medicaid and Medicare patients, has crossed the billion-dollar mark.
The rest of the portfolio reads like a map of the system's hardest corners: Strive Health and Somatus in kidney care, Curana Health and Habitat Health for frail and elderly patients, Unite Us for social services referrals, Marble Health for teen behavioral therapy on Medicaid, and Ambience Healthcare and Qualified Health building AI infrastructure for clinicians. The common thread is not a single sector. It is a customer - the patient other investors decided was too complicated to serve.
There is a reason that patient gets skipped. Medicaid margins are thin, the populations are medically complex, and the reimbursement rules shift with state politics. Building a company in that environment means underwriting risk that a consumer-app investor never has to price. But the flip side is a market of tens of millions of people whose care is expensive precisely because it is badly coordinated - and coordination is a solvable problem. Town Hall's wager is that the companies which crack it will not only do good; they will capture savings large enough to fund durable, defensible businesses. The exits so far are the evidence the firm points to when a limited partner asks whether the trade repeats.
Where It FocusesThree populations, over and over
Read the firm's own materials and the same groups keep appearing. The details change; the destination does not.
Frail seniors
Home-based and complex care for aging, high-need Medicare patients.
Rural America
Access in counties where the nearest clinic may be the only one.
Behavioral health
School-based and virtual mental health for kids and teens on Medicaid.
Complex conditions
Kidney disease, cancer and chronic care under value-based models.
The business model, plainly
Town Hall is a venture firm in the conventional sense: it raises capital from institutional limited partners, invests across launch, venture and growth stages, and earns management fees plus carried interest on the returns. What is less conventional is the diligence advantage. The team blends public-sector fluency - what actually gets reimbursed, how Medicaid managed care contracts work, where policy is heading - with private-equity underwriting and an operator's network. That mix is hard for a generalist fund to replicate, and it is most valuable precisely in the government-program markets that scare generalists off.
The firm rounds out its bench with venture advisors who have run large parts of the system, including former CDC Director Mandy Cohen and health-policy operator Adam Boehler. It is a roster built less for deal flow than for knowing whether a care model will survive contact with a real payer.
The FieldWhere it sits in the market
Health-focused venture is not empty. General Catalyst, Andreessen Horowitz's Bio + Health practice, Oak HC/FT, Define Ventures and 7wireVentures all compete for the best digital-health founders. What separates Town Hall is the deliberate concentration on underserved and government-program populations - a segment most firms treat as one slice of a broader thesis rather than the entire strategy. The bet is that focus in an under-competed market beats breadth in a crowded one.
Slavitt is careful not to oversell the tool. "Technology doesn't close the gap," he has said, "but it's going to help people." That is roughly where Fund IV plants its flag: AI will not, on its own, fix American healthcare's equity problem. But applied to the places where the system is most expensive and least effective - repeat hospitalizations, missed follow-ups, care that never reaches a rural doorstep - it can move the numbers that matter. If the firm is right, the return and the outcome are the same line item.
Whether health equity holds up as an asset class past $1.4 billion is the open question. Larger funds must write larger checks, and the supply of billion-dollar outcomes in Medicaid-adjacent markets is not infinite. But for now, Town Hall Ventures has done the one thing that ends most arguments in venture capital. It has shown the returns.