Dallas-based medical diagnostics company Spectral AI has secured up to $15 million in debt financing from Avenue Venture Opportunities Fund II, L.P., a fund managed by Avenue Capital Group. An initial $8.5 million has already been drawn down, with the remaining $6.5 million contingent upon FDA clearance of the company’s DeepView® System.
Alongside the debt raise, Spectral AI also closed $2.7 million in equity financing from both institutional and existing investors. With more than $14 million in cash now available, the company says it’s positioned to accelerate commercialization of its AI-powered burn assessment platform in the U.S. market.
Spectral AI operates in the fast-evolving field of predictive diagnostics, focusing on improving wound care through AI and multispectral imaging. Its flagship product, the DeepView® System, uses real-time imaging and algorithms to assess burn wounds and predict healing potential, potentially transforming the standard of care in emergency medicine and surgical planning.
“We have been impressed with the clinical data generated by Spectral AI’s DeepView System,” said Chad Norman, Senior Portfolio Manager at Avenue Capital Group. “We believe it will offer significant benefits to burn victims in the future.”
The company will use the new capital to support the commercial rollout of the DeepView® System in the United States, pending regulatory approval. This includes expanding production capabilities, advancing FDA-related milestones, and scaling its commercialization infrastructure.
The second tranche of financing—$6.5 million in debt and a $7 million equity raise—is tied to FDA clearance. The agreement includes an interest-only period of at least 15 months, extendable to 24 months upon reaching the associated milestones. To support investor confidence, the company has agreed to a six-month standstill on further equity sales.
Founded in Dallas, Spectral AI is focused on using AI to improve wound care decision-making, particularly in burn treatment. The company’s motto, “Seeing the Unknown®,” reflects its mission to give clinicians rapid, objective insights about wound healing outcomes, helping to guide treatment decisions before surgical intervention.
At the core of its offering is the DeepView® System, designed to provide real-time predictions about how burn wounds will heal. The system aims to offer a faster, more accurate assessment than traditional methods, improving patient care and potentially lowering treatment costs.
Chairman Dr. J. Michael DiMaio commented, “This significant financing provides Spectral AI with the resources necessary to finalize our commercialization efforts and bring our cutting-edge DeepView System across the finish line to the U.S. market.”
Avenue Capital Group, a global investment firm with experience in structured and opportunistic credit, is the main backer of the debt financing. As part of the agreement, warrant coverage was issued for 8.5% of the total commitment, with an exercise price of $1.80 per share.
SP Angel Corporate Finance LLP acted as placement agent for UK-based investors, while Dominari Securities LLC served U.S.-based participants. The financing structure highlights a balanced mix of strategic and institutional support for Spectral AI’s long-term roadmap.
