Sydney startup Medow Health AI has raised $3.5 million from existing backers, taking its total funding to $8.5 million since April 2024. It is a small round, but it shows capital chasing medical AI beyond the sector's biggest leaders.
Medow sells an AI scribe that records consultations and produces the clinical notes. It is used in more than 1000 specialist clinics and is on track to process about 3 million consultations this year, up 300%. The new money funds an AI front desk that answers clinic calls and manages bookings.
The demand is real. Approximately 40% of Australian doctors were using a scribe by November 2025, up from 22% in August 2024, and investors have followed. Melbourne-based Heidi Health raised US$65 million in October 2025, led by US fund Point72 Private Investments, at a valuation more than four times its level five months earlier. It is now reportedly set to reach a $1 billion valuation. Lyrebird Health raised $12 million led by Five V Capital and UK based Octopus Ventures.
For Australia, other health startups are winning overseas capital and selling offshore. Heidi's technology is used in some of the biggest hospitals in Australia, Canada, Germany and the United Kingdom, and Lyrebird is preparing to expand internationally.
The risk is oversight. The Therapeutic Goods Administration has moved its review of AI scribes into compliance action, and scribes that only draft notes stay outside medical device rules while clinicians check every output. Compliance adds cost, which better-funded players are better placed to absorb.
