Last year, Chris Heckler was coming to the end of a five-year non-compete after selling his last company, a healthcare startup. “I was sitting on the sidelines doing angel investing, and I realized I was too young to retire,” he told TechCrunch. “I wanted to get back into it.”
At the same time, Joseph Akintolayo had just sold his fintech company. He, too, had a non-compete, but was noodling on ideas for a company. He knew Heckler, as Akintolayo had once served as an advisor on one of his projects.
In this downtime, however, they wanted to come together — Heckler, with his connections, and Akintolayo, with his knowledge of AI and supply chains — to try and build something new.
The result was SpendRule, launched last summer as an AI-powered platform that helps healthcare systems track their spending. The company emerged from stealth on Tuesday, with $2 million in funding in a round led by Abundant Venture Partners. Others in the round include MemorialCare Innovation Fund and Zeal Capital Partners.
Right now, if an item has a barcode, health systems use a three-way match, Akintolayo, the company’s CTO, said, which connects a purchase to an invoice. But a lot of the time, health systems have purchases and contracts (such as maintenance, janitorial, translation services, or laundry) that lack bar codes or easily identifiable purchase receipts.
Because these types of purchases can often be tricky and complex to manage, overspending is quite common. SpendRule is a technology that ensures hospitals pay only what was negotiated in their contracts. It is integrated with and operates on top of a hospital system’s current enterprise resource planning software, contract management software, and accounts payable workflows, pulling information from contracts, invoices, internal databases, and vendor data to validate invoices before payment is released.
It flags discrepancies and tells teams when to pay and when not to. Typically, hospitals hire an auditor every two years to perform this function or manually review each invoice. It was a tedious task bound to be automated in this current wave of AI. Already, big names like Kettering Health, MemorialCare, and MUSC Health are using the platform, Akintolayo said.
Heckler and Akintolayo started the company only last summer but managed to close a round by Halloween, mainly due to Heckler’s industry connections. “We were able to painlessly close that initial round and use that to grow the team to support the customers,” he said. The new capital will be used to hire and continue developing the company’s AI infrastructure.
Heckler said SpendRule considers existing invoice auditors its competition, such as SpendMend and GHX. But Akintolayo said again, one main difference is SpendRule’s focus on purchase services, the type of items hospitals buy that do not have barcodes.
“Our goal is to build a more resilient hospital system,” Akintolayo said. “That’s our vision. To protect the bottom line of everyone by connecting their data and helping them make better decisions.”