Hot healthcare startup Rad AI has raised a Series C funding round, Business Insider has learned from multiple sources.

The company, which creates AI-powered tools for radiologists, grabbed fresh funding in a Series C round led by Transformation Capital, according to two people with knowledge of the round.

Those people said the new fundraise valued Rad AI at $525 million.

Rad AI brought in about $60 million in the round, per one person with knowledge of the efforts.

Rad AI did not officially respond to requests for comment. Transformation Capital declined to comment.

Transformation Capital preempted the Series C funding, two of the sources familiar with the deal said. It comes on the heels of Rad AI’s Series B, a $50 million fundraise led by Khosla Ventures and announced in May 2024, just seven months prior to this latest round.

Founded in 2018, Rad AI has seized on a wave of interest in healthcare tech that uses generative AI to make providers more efficient and reduce burnout.

While many startups in the radiology tech market are going after imaging — using AI to flag potential abnormalities in a scan, for example — Rad AI assists clinicians with more routine tasks, including automatically generating radiology reports and automating patient follow-ups.

Sirona Medical, which raised a $42 million Series C in November led by Avidity Partners, is among Rad AI’s closest competitors.

Proprietary data from VC firm TRAC suggests that Rad AI is onto something big. The startup made its way onto TRAC’s 2025 list of future unicorns, which uses TRAC’s algorithm to predict which early-stage startups are most likely to reach valuations of $1 billion or more. TRAC says the startups it identifies have a one-in-five chance of becoming unicorns.

Rad AI cofounder Dr. Jeff Chang bills himself as the youngest US radiologist in history. He began medical school at NYU at age 16 and spent 10 years working in emergency-room radiology. His cofounder and Rad AI’s CEO, Doktor Gurson, is a serial tech entrepreneur — Rad AI is his fifth company, according to his LinkedIn.

The company says it’s now working with nearly half of all US health systems and 9 of the 10 largest radiology practices in the country.