Somewhere in Texas this afternoon, a home health nurse is sitting in her parked car in a driveway. The visit is over - she has changed the dressing, checked the vitals, asked the questions that matter - and now she has a laptop open on the passenger seat and an intake form to finish. The form is called an OASIS. The best nurses in the country complete it in about an hour and a half, which is to say it takes them longer to document the visit as it took to deliver it. So she sits in the car and types, because the alternative is burning the midnight oil at her dining table. Then she drives to the next house and does it again.

In 1966, two economists named William Baumol and William Bowen published a small book explaining why live performing arts kept getting more expensive. It takes four musicians as long to play a Beethoven quartet today as it did in 1800 - the labor is the product, and it cannot be sped up - yet their wages kept rising with everyone else’s. Baumol called this the cost disease, and he believed it had no cure. The sectors he expected it to ravage most were ones where a human’s time is the purpose: the arts, education, and care of the sick. It still takes a nurse the same amount of time to change a bandage today as it did when Baumol was writing.

We have come to believe the cost disease finally has a cure, and that the cure looks less like a better tool but a different kind of company. We have backed many other great AI-native services companies with this thesis, like Crosby and Reserv, and finally now, Adaptive Innovations.

We are excited to announce we led the $10M seed round in Adaptive Innovations and are doubling down in their $50M Series A. Adaptive is rebuilding home health from the ground up around what AI now makes possible - and in doing so, it is taking direct aim at the one cost the rest of the economy has never managed to make cheaper: the overhead of caring for another person.

The Dynamo and the Agency

The obvious move is to sell software to the agencies with wasted clinical time. Adaptive's founders tried exactly that. They went to existing home health agencies with tools to automate the back office, and they were disappointed by what the agencies did with the tools: they did not treat any more patients. The workflows had been poured in concrete decades ago, and you cannot re-pour concrete from the outside.

There is a precedent for this from the history of technology. When electric motors arrived in American factories in the 1880s, almost nothing happened to productivity for forty years. Factories had been built around a single steam engine that drove every machine through a clattering system of overhead shafts and belts, and when electricity came, owners simply pulled out the steam engine and dropped one big electric motor in its place. They had electrified the factory without rethinking it. The economist Paul David told this story in 1990 to explain why the computer, too, seemed to be everywhere except in the productivity numbers. The gains came only in the 1920s, when a new generation realized you could put a small motor inside each individual machine, free the floor from the tyranny of the driveshaft, and lay the whole building out around the flow of work rather than the transmission of power. The technology had been available for a generation, yet what was missing was the willingness to build the factory again.

Home health was designed forty years ago, on the assumption that a human being had to touch every step of it. Selling that system a better motor was never going to be enough. So Adaptive did the harder thing. It became the provider. It built a home health company from the inside out, with AI handling the eligibility checks, the prior authorizations, the coding, the billing, the scheduling, the QA, and the collections that traditional agencies still spend sixty to ninety cents of every clinical dollar performing by hand. When the marginal cost of that administrative work falls toward zero, the shape of the entire cost curve changes - and with it, the answer to a question that quietly decides who gets care: which patients can an agency afford to take?

Two in Five

Here is the part of home health that should bother everyone, and that almost no one outside the industry knows. Two out of every five patients referred for home health never receive it. They are not turned away because they don't qualify, or because there is no nurse to send. They are turned away because the cost of doing the paperwork to admit them is higher than what the agency will be paid to treat them. The patient goes to a nursing facility instead, or quietly gets worse at home until an ambulance is called. Across the country, this adds up to more than forty billion dollars in rejected referrals every year. Is it acceptable that whether a recovering patient gets a nurse comes down to whether the math on a form happens to work out?

Adaptive's answer is to make the math work out for everyone. Because its cost to admit a patient collapses, it can practice what the team calls universal acceptance. It can profitably take the patients that every other agency has to refuse. The proof is buried in a number that sounds dull until you understand it. Most agencies fight to fill their rosters with traditional Medicare patients, because the reimbursement is higher and the admin is more bearable; they want that mix to run eighty percent. Only about a quarter of Adaptive's patients are on traditional Medicare. The company has inverted the entire industry's selection logic by being cheap to operate, which is what generosity looks like once the overhead is gone.

And it is working. Since its quiet launch in 2025, Adaptive has delivered more than a hundred thousand visits and built referral relationships with over five hundred healthcare organizations, including every major hospital system in Texas. Its patients are readmitted to the hospital 4.9 percent of the time, against an industry average close to thirteen. A discharge planner does not need a pitch deck to understand what that means. They need a partner who will say yes to every appropriate patient and get them home safely - and there is finally one who can.

The Lady with the Lamp

We remember Florence Nightingale as the founder of modern nursing, and she was. What gets left out of the children's books is that she was also one of the great statisticians of her century - the first woman elected to the Royal Statistical Society, who proved with a now-famous diagram that the soldiers of the Crimean War were dying not on the battlefield but of preventable disease in filthy hospitals, and who used that data to force a government to reform. The patron saint of bedside care was, in other words, also obsessed with the back office. She understood something the home health industry forgot: the documentation and the data are not a distraction from care. Done right, they are how you prove the care worked, and how you make the next round of it better.

This is why the team matters so much, and why it is so rare. The reason no one has rebuilt home health from the inside is that doing so demands two kinds of people who almost never come together: people who can run a real clinical operation on day one, and people who can build the AI that makes the operation viable. Adaptive has both.

We first met Alex Wendland, co-CEO, when he was a vocal part of our NYC fellowship, where he struck us immediately with sharp questions, strong opinions, and firm views on subjects ranging from health policy to the correct number of plants for any given room (the answer, per Alex, is a very high number). In college he co-founded Luminopia and shipped the first VR treatment for lazy eye to win FDA authorization; he later became chief product officer at Pinwheel, and built and sold a compliance-software company along the way. His co-CEO, Logan Stinson, is a veteran operator and private equity investor who has scaled profitable home health agencies across Texas and knows post-acute care from the inside. Ryan Tolsma, CTO, left high school at sixteen for Stanford, starred as a quant researcher, and most recently did fpost-training at Character AI. Hunter Stinson, COO, knows the clinical and operational problems firsthand, as a registered nurse and former U.S. Army Ranger. Between them, they have the two things the Nightingale problem requires: the credibility to deliver care, and the conviction to automate everything around it.

The Healthcare System America Deserves

By 2034, for the first time in this country's history, there will be more Americans over sixty-five than under eighteen. Every one of them will, at some point, need someone to come to the home. We do not have enough nurses to meet that need the way we currently spend their time, and we never will - not while half of a clinician's day is eaten by the very paperwork Baumol predicted would only grow more expensive.

So we think again about the nurse in the driveway. The promise of Adaptive is not that we replace her. It is that we give her back the ninety minutes - that the form fills itself from the visit she already did, that the authorization is already handled, that she gets to drive to the next house and be a nurse instead of a clerk. That is what it actually means to cure the cost disease: not to spend less on care, but to spend it on care.

Adaptive is hiring across clinical, operations, engineering, and product. If you want to build the healthcare system this country needs, we would like to hear from you.

We could not be prouder to be in business with Alex, Logan, Ryan, and Hunter.