Investors recently poured $133 million into a digital health company that is taking an unusual approach — using a low-carb diet to manage type 2 diabetes.
San Francisco-based startup Virta Health recently raised $133 million in funding, led by investment firm Tiger Global. It would double Virta’s valuation to $2 billion after raising $373 million to date, according to Crunchbase.
Unlike other companies with app-based coaching programs for managing diabetes, such as Livongo and Omada, Virta’s is based on restricting carbohydrates. Users are sent equipment, such as a connected scale, blood glucose and ketone testing strips, and enter their weight and blood sugar data.
Like many of its app-based peers, Virta hires health coaches. It also hires physicians to help de-prescribe medications like insulin.
Trulia co-founder Sami Inkinen founded the startup in 2014 after he was diagnosed with prediabetes. Dr. Stephen Phinney and Jeff Volek, who have published books on low-carb diets, are also listed as co-founders.
In an email, Virta spokesperson Lauren Cunningham confirmed that its program is based on similar principles to a ketogenic diet.
“We restrict carbohydrates to one’s personal tolerance level, while also adjusting for lifestyle, preferences, and food access,” she wrote.
Virta doesn’t mention its keto-like approach in its marketing materials. It bills itself as “the leader in type 2 diabetes reversal” — a claim based on an open-label, non-randomized trial published in 2018. Virta found that 94% of people who used its program for a year were able to reduce or stop taking insulin, but the fact that participants volunteered to use Virta’s solution could affect the results.
While there’s some evidence around the use of ketogenic diets for certain conditions, such as reducing seizures in children, it’s less clear how effective they are in the long-term. Because ketogenic diets can be restrictive, dieticians have raised concerns that they might be difficult to follow, or that people might turn to more unhealthy sources of protein and fat.
Virta says it has drummed up more than 100 companies as clients so far, and notably, a partnership with the Department of Veterans Affairs. It also structures its payments under a risk-based model, which means that companies only have to pay an enrollment fee for an employee after they use it for 30 days, and make yearly payments tied to glycemic control and medication reductions.
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