In early July, Rock Health and StartUp Health each released reports on digital health funding for the first half of 2017, both of which show positive trends for digital health investment.
StartUp Health's midyear report predicts that 2017 will be the biggest year yet for digital health funding, with 306 deals equaling a total of $3.8 billion raised in Q2 and $6.5 billion for the first half of the year. For comparison, StartUp Health recorded 613 deals in all of 2016, totaling $8.3 billion in funding. So far for 2017, big data/analytics has received the most funding, but other popular categories of digital health investment include workflow, wellness, and patient/consumer experience.
Rock Health's midyear report also showed the strong surge in funding for Q2, but overall had smaller numbers than StartUp Health, tracking 188 deals in H1 2017 for a total of $3.5 billion in digital health funding. According Rock Health, funding for 2016 totaled $4.3 billion across 304 deals. Rock Health's estimates are more conservative because it reports only U.S.-based digital health deals of $2 million or more, and excludes health care services companies, biotech/diagnostic companies (StartUp's report included the company Grail, which received $914M in Q2), and software companies that are not solely focused on health care. Top categories of funding according to Rock Health include consumer engagement, digital therapies, and big data/analytics.
Despite differences in methodology, both reports expect the investment momentum of the first half of the year to continue through the end of 2017. This year could set records for digital health not just in terms of total funding, but also the number of deals and average deal size.
Many health care stakeholders came into 2017 holding their breath, unsure about how the new administration would change health care policy. So far, health care has been the center of much controversy (as expected), but these reports show that such political uncertainty has not stifled digital health investments.
Regardless of political outcomes, there are a number of issues that have bipartisan support and indicate no-regrets areas of focus for health care organizations. The shift to value-based care is unlikely to waver, and industry stakeholders should continue to embrace digital innovation to improve care outcomes, lower costs, and appeal to the rising influence of consumer expectations.
With this combination of health care transformation, the critical and expanding role for IT, and evolving disruptive technologies, we're witnessing the emergence of digital health systems—organizations that are taking full advantage of IT-powered capabilities and innovation to improve or build new business models, customer/patient relationships, and care delivery processes.
For short summaries of the reports, refer to MobiHealthNews' articles on Rock Health and StartUp Health.
Next, get our cheat sheets on digital health systems
Download our cheat sheets on digital health systems, artificial intelligence, big data, virtual reality, and more to brush up on new and emerging technologies in today's digital world.
Get the Cheat Sheets