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02
May
2014

Digital Health Funding- Solid as a Rock?

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The latest report by Digital Health seed fund Rock Health on, well, funding in the Digital Health area shows that there remains an ample appetite for investment in mHealth projects, and plenty of projects to back. In its third report on digital health, Rock Health has found that over $1.9 billion was invested in the sector in 2013, double the amount just three years ago. According to Rock Health, 186 digital health companies raised more than $2 million in 2013; and six major areas were responsible for the bulk of investment:  Electronic Health Records saw $245 million invested, and Analytics and Big Data achieved $161 million in funding. Projects involving Population and Health Management garnered $126 million, and Healthcare Consumer Engagement (comprising consumer tools to purchase healthcare services and health insurance) achieved $119 million. There was also significant activity in the Wearables and Biosensing area, achieving $136 million and Digital Medical Devices ($146 million). The year 2013 also saw heavy investment in a few really substantial projects, with Evolent Health achieving $100 million, and another five companies raising more than $40 million, for projects ranging from ingestible sensors to intelligent orthopaedic devices. Overall though, most funding (over half) went to seed early stage (stage A) projects. These accounted for 51% of investment in the area with fourth round funding accounting for but 8%. From a geographical perspective, Silicon Valley has firmly established itself as the digital health hub, accounting for over $200 million in funding, and, as in other areas of investment, crowd funding has become a new conduit for money to reach projects, with Indiegogo emerging as the front runner ahead of Medstartr and Kickstarter. Finally, Rock Health notes that, with capital building up in digital health companies, there are likely to be a number of successful exits in 2014.