Connecticut Healthcare Fund Posts Strong 28% Returns Betting on AI Companies

A major healthcare investment fund led by two Wall Street veterans delivered impressive 28% returns last year by focusing on artificial intelligence-driven medical companies. The Connecticut-based Braidwell fund, which manages over $3 billion, plans to expand its AI healthcare investments this year.

A Connecticut-based healthcare investment fund achieved impressive 28% returns in the past year by concentrating on artificial intelligence-powered medical companies, and now plans to expand those investments further.

Braidwell, headquartered in Stamford, Connecticut, was established by Alex Karnal, a former Deerfield Management executive, and Brian Kreiter, who previously served as chief operating officer at Bridgewater Associates. The fund has positioned artificial intelligence technology as the core of its investment approach.

The investment firm raised $3.5 billion when it launched in early 2022, making it one of the largest hedge fund debuts following the coronavirus pandemic. According to a recent investor letter obtained by Reuters, Braidwell has invested over $1 billion across various biotechnology, pharmaceutical, and medical device companies.

Major success stories from last year included cancer testing company Guardant Health, medical device manufacturer Alphatec, and molecular diagnostics firm Caris Life Sciences, according to Karnal and Kreiter’s investor communication. The Braidwell Partners Fund concluded the December quarter managing approximately $3.1 billion in assets.

The investment company operates through three distinct divisions. The primary Braidwell Partners Fund focuses on publicly traded stocks and bonds, while Braidwell Credit offers direct lending services to healthcare businesses. Additionally, the firm runs Braidwell Labs, which supports early-stage healthcare startups.

“We expect 2026 to show some incredible opportunities at the intersection of AI and Bio,” said Kreiter. “You will likely see us build or back both AI-enabled medicine companies as well as companies that are developing platforms and tools that will be used by medicine makers.”

Braidwell documented a 49.5% increase in overall gross performance from 2023 to 2025. The flagship fund generated 28% gross returns and 21% net returns last year, performing similarly to broader life sciences market indicators, which averaged gains of 27% to 35%. The fund’s strong performance was primarily driven by investments in non-therapeutic businesses.

Karnal currently holds the position of chief investment officer at Braidwell after spending approximately 16 years with Deerfield, a healthcare-focused investment company. He has also established a nonprofit organization called the Institute for Life Changing Medicines alongside gene-therapy pioneer James Wilson.

Before joining Braidwell, Kreiter worked as an assistant to Chicago’s mayor and later spent nearly 13 years at the prominent hedge fund Bridgewater.

The two founders have been developing their investment platform since 2022, seeking to combine conventional Wall Street investment strategies with medical research and artificial intelligence technologies.

Braidwell employs approximately 40 professionals, including molecular biologists, biostatisticians, commercial analysts, artificial intelligence engineers, and portfolio managers. Karnal and Kreiter, who had maintained a professional relationship for years, seriously began planning Braidwell’s launch during the COVID-19 pandemic.

While still employed at Bridgewater, Kreiter began developing an early natural-language artificial intelligence system, assembling a team of engineers who had previously contributed to IBM’s Watson computer platform. The co-founders began exploring potential healthcare solutions that could serve the broader population recovering from the pandemic.

One of their initial software applications was utilized by the NFL to help manage that year’s Super Bowl, though the NFL did not respond to requests for comment.

“We decided to build a company from scratch in our labs to support emerging venture-stage companies – and then we also wanted to buy the stock of public companies, and give loans to big, established companies because our view is that in most areas of investing that type of activity is very siloed,” Karnal said in an interview.