The insurance technology (insurtech) industry has seen $27B in total all time funding. Let’s analyze the investors making bets into insurtech and identify the most active firms.
The graphic below shows insurtech investors based on their number of investments into the sector. If an investor participates in two investment rounds in the same company (such as a Series A and Series B), that would qualify as two investments for this graphic.
As the graphic demonstrates, 500 Startups has made the most bets in the insurtech sector with 39 investments. Plug and Play follows in second place with 27 investments. Examples of companies 500 Startups invested in include Kin Insurance, Indio Technologies, Embroker, and Jones. Let’s see which investors make their way onto this list in 2019!
Now that 2018 is complete, let’s examine how funding in health technology compares to previous years. The graphic below shows the total annual health technology funding amounts over time.
As the graphic demonstrates, 2018 experienced the highest health technology funding on record at $17.2B. It constitutes a slight 1% increase from the previous year’s funding. Some of the largest funding events in 2018 include a $550M round for Peloton, a $500M round for WeDoctor, a $500M round for Moderna Therapeutics, and a $375M round for Oscar Health. Over the past 5 years, health technology funding grew at a CAGR of 35%. It’ll be interesting to see if its funding will dip in 2019 or reach even higher levels.
This blog post examines the different components of the health technology ecosystem. We will illustrate what the categories of innovation are and which categories have the most companies. We will also compare the categories in terms of their funding and maturity.
Digital Medical Devices Is the Largest Health Technology Category
Let’s start off by looking at the Sector Map. We have classified 2250 health technology startups into 22 categories that have raised $81 billion. The Sector Map highlights the number of companies in each category. It also shows a random sampling of companies in each category.
We see that Digital Medical Devices is the largest category with 307 companies. These companies build IT-enabled medical and diagnostic devices for doctors. These devices include detection equipment, monitoring equipment, and surgical tools. Some example companies include Signostics, MediBeacon, Stimwave, and AliveCor.
Let’s now look at our Innovation Quadrant to find out the funding and maturity of these categories in relation to one another.
The Pioneers Quadrant Has the Most Health Technology Categories
Our Innovation Quadrant divides the health technology categories into four different quadrants.
We see that the Pioneers quadrant has the most health technology categories with 10. These categories are in the earlier stages of funding and maturity. The Established quadrant has 7 categories that have reached maturity with less-than-average financing. The Disruptors quadrant contains 4 categories that have acquired significant financing at a young age. The Heavyweights quadrant contains one category, Healthcare Robotics. This category has reached maturity with significant financing.
Conclusion: The Digital Medical Devices Category Leads Health Technology
As the analysis above demonstrates, the Digital Medical Devices category leads health technology in total companies. We’ll see what’s in store for the health technology landscape in the new year!
The Genomics category leads the sector in Q2 funding
The Digital Medical Devices category leads the sector in all-time funding
We’ll highlight these observations with some graphics and discussions below.
The Genomics Category Leads Health Technology In Q2 Funding
To start off, let’s review the amount of funding raised this quarter by each category within health technology.
The above graphic highlights that the Genomics category leads the sector in Q2 funding with just under $1B. Its funding is 1.4 times the funding of the next category, Digital Medical Devices at $700M.
Genomics companies utilize human genome data for analytics, prevention, and treatment. Some example companies in this category are 23andMe, Helix, and Counsyl.
Let’s now investigate how these categories’ funding compare with each other historically.
The Digital Medical Devices Category Leads the Sector in All-Time Funding
The graph below shows the all-time funding for different health technology categories. The Q2 funding and growth rates of these categories are also highlighted.
As the bar graph indicates, the Digital Medical Devices category leads the sector in total funding at almost $14B. The Genomics category follows in a close second place with an all-time funding of $13.6B. These two categories’ funding are more than twice the funding of the next category, IoT Fitness at $6.6B.
Digital Medical Device companies build IT-enabled medical and diagnostic devices for doctors. These devices include detection equipment, monitoring equipment, and surgical tools. Some example companies are Signostics, MediBeacon, Stimwave, and AliveCor.
In summary, it’s clear that the Genomics and Digital Medical Devices categories are leading the sector in funding. Let’s see how the the rest of 2018 shapes up for health technology!
Funding amount percentages showed a slight shift to later stages
Funding count percentages showed a clear shift to later stages
We’ll explain these key observations with some graphics and discussions below.
To help set the stage, the graphic below highlights health technology funding amounts over time. As you can see, the sector’s overall funding demonstrated consistent growth.
Health Technology Funding Amount Percentages Shifting Slightly to Later Stages
Let’s examine the health technology funding amounts by round as a percentage of the total funding amount by year.
The above graph indicates that there has been a slight shift to later-stage funding. In 2012, Seed and Series A funding amounts accounted for around 25% of total funding. By 2017, that total had dropped to under 20%. Consequently, the funding amounts from Series B onward grew from around 75% of total funding to over 80%.
Would the funding count percentages confirm this trend? Let’s examine in the the next section to find out.
Health Technology Funding Count Percentages Clearly Shifting to Later-Stage Events
The below graph shows the health technology funding event counts by round as a percentage of total events.
This graph paints a clearer picture of the funding shift than the previous funding amount graph. In particular, Seed funding count percentage decreased by more than half its size from 53% to 23%. The funding count percentages in all other rounds increased by various magnitudes from 2012 to 2017.
Conclusion: Health Technology Sector Matures As Funding Shifts to Later Stages
In summary, we have seen health technology funding amounts and funding event counts shift from the early-stage rounds to mid and late-stage rounds. These observations led us to conclude that the health technology sector is starting to mature.