Digital Health Startups Shatter Previous Funding Records Garnering $1.97B in 2013Digital Health Startups Shatter Previous Funding Records Garnering $1.97B in 2013

Funding in digital health startups reached an all time high in 2013, with some investors investing in multiple deals throughout the year.

January 3, 2014

2 Min Read
Digital Health Startups Shatter Previous Funding Records Garnering $1.97B in 2013

Funding of digital health companies in 2013 shattered all previous records with a combined investment of $1.97 billion, according to a report from Rock Health.

That amounts to a whopping 39% increase over digital health investments in 2012. The number of deals also increased - it grew 38% from 2012 and 134% from 2011.

Venture capital companies are eschewing all other healthcare sectors - be it software, biotech and medical device (no surprises with the latter, third sector) - to put all their eggs in the digital health basket.

Rock Health, which tracks investments that are at least $2 million, found that 186 digital health companies each managed to raise more than that amount in 2013.

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Here are other notable details from the report:

  • Out of 24 subcategories tracked, Rock Health identified six broad themes that accounted for nearly 50% of overall funding in 2013. They are electronic health records and clinical workflow ($245M); analytics and big data ($161M); digital medical devices ($146M); wearables and biosensing ($136M); population health management ($126M) and healthcare consumer engagement ($119M).

  • Year-over-year digital health investment growth can be primarily attributed to a higher number of early stage deals - in 2013, 51% of the overall number of deals were seed or Series A investments, compared to 39% in 2012.

  • 27 venture capital firms invested in at least three deals last year, compared to only eight who did the same in 2012.

  • The investor who did the most number of digital health deals - a total of seven - in 2013 was the Social+Capital Partnership.

  • California emerged as the largest beneficiary of digital health investment dollars with companies based there garnering more than $200 million in 2013.

  • In the realm of initial public offerings, digital health saw two major transactions that led to a combined $5 billion in market value in 2013.

Here is the full report:

Digital Health Funding 2013 Year in Review by @Rock_Health from Rock Health

 

[Photo Credit: iStockphoto user AlexSava]

 -- By Arundhati Parmar, Senior Editor, MD+DI
[email protected]

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