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More on Digital Health

By July 19, 2016Commentary

StartUp Health tracks funding and other activity related to digital health and has issued a report on the first half of 2016.  (StartUp Health Report)   Globally 234 companies were funded with $3.9 billion in that time period, compared to 498 at a $2.96 billion rate in the comparable period of 2015.  A few large deals skewed the higher funding in 2016.  $500 million went to Chinese patient scheduling vendor An Ping Good Doctor.  Health insurance received large funding also, with flailing Oscar getting $400 million, Clover Health $160 million and Bright Health $80 million.  Big data and analytics also garnered big deals, with Human Longevity at $220 million and Flatiron at $175 million.  By category, patient and consumer experience received $958 million; wellness $854 million, personal health and quantified self (my favorite name), $524 million and big data/analytics $406 million.  A buzzword blast from the past, population health, has fallen down the list to only $55 million in the first half of 2016.  32% of deals were seed round, 33% Series A, 18% Series B and the rest were C or later.  But more of the funding obviously goes to later stage rounds.  San Francisco, NYC, San Diego and Boston were the most active geographies.  Top investors by numbers of deals include Khosla Ventures, GE Ventures and StartUp Health itself.  There were 446 unique investors, indication no lack of interest.  About half the deals and half the funding went to 50 companies that are viewed as “hot”.  Alas, the ultimate value of many of these companies seems a mystery.  For digital health companies going public in 2015, most are down dramatically from the offering price.  Fitbit’s stock price has declined 60% and Teladoc’s 51%.  Evolent Health is the only gainer at a whopping 1%.  I would say that in digital health, the motto should be “buyer beware”.

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