Here is our Q2 2018 summary report on the health technology startup sector. The following report includes a sector overview and recent activity.
Here is our Q1 2018 summary report on the health technology startup sector. The following report includes an overview, recent activity, and a category deep dive.
The Health Technology sector contains companies focused on the digitization of healthcare across the value chain from the providers, to the payers, to the patients and consumers. They often optimize existing medical practices, provide health information to individuals, or create new frontiers in medicine.
In this post we examine the different components of Health Technology and how they make up this startup ecosystem. On our Health Technology research platform, we have classified the companies into 22 categories. This blog post will illustrate what these categories are and which categories have the most companies. We will also look at how these categories compare with one another 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 for the Health Technology sector. As of March 2018, we have classified 2139 Health Technology startups into 22 categories that have raised $64 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 288 companies. This category contains companies that build IT-enabled medical and diagnostic devices for doctors. These devices include surgical tools, monitoring equipment, and detection equipment. Some example companies are Signostics, MediBeacon, Stimwave, and AliveCor.
We have seen what the different categories making up this sector are and the number of companies in each. What about their funding and maturity in relation to one another? Let’s look at our Innovation Quadrant to find out.
Healthcare Robotics Is the Heavyweight Category in Health Technology
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 15. The Pioneer categories are in the earlier stages of funding and maturity. The Established quadrant has three categories have reached maturity with less financing. These three categories are EHR/EMR, Clinical Backend, and Population Health Management.
The Disruptors quadrant also has three categories: Genomics, Health Payments, and IoT Fitness. These three categories have acquired significant financings at a young age. The Heavyweights quadrant contains the Healthcare Robotics category. This category has reached maturity with significant financing. On a relative basis, the companies in this Heavyweight category have reached more maturity and acquired more funding.
We’ve now seen the Health Technology categories and their relative stages of innovation. How do these categories stack up against one another? Let’s look at the Total Funding and Company Count Graph.
Digital Medical Device Startups Have the Most Funding and Companies
The graph below shows the total amount of venture funding and company count in each category.
As noted earlier, the Digital Medical Devices category leads Health Technology with 288 companies. The above graphic highlights that Digital Medical Devices also leads in funding with almost $13 billion. Some of the best-funded companies in this category are HeartFlow ($477M), Proteus Digital Health ($422M), and ViewRay ($418M).
Conclusion: The Digital Medical Devices Category Leads the Sector
From the above analysis, we can see that Digital Medical Devices dominates Health Technology in funding and company count. On the other hand, Healthcare Robotics stands out as the Heavyweight category in the sector, having reached maturity with significant average funding per company versus companies in other categories. It’ll be interesting to see how the Health Technology landscape will change and develop throughout the rest of 2018.
The following two graphs summarize the rounds of funding going into the Health Technology space. Please note these graphics are made using data through August 2017.
The graph above shows the total amount of VC funding broken out by round. From 2006 to 2016, we saw a general increase in the overall sector funding, with the total amount peaking in 2015 and declining slightly thereafter. Earlier stage rounds (Series A, B, and C) make up a larger share of the total amount.
The graph above shows the total count of funding events broken out by round. From 2006 to 2016 we’ve seen an upward trend that peaked in 2014 and declined slightly thereafter. Earlier stage funding such as Seed, Series A, and Series B events make up the majority of funding event counts.
We are currently tracking 2040 Health Technology companies in 22 categories across 57 countries, with a total of $52.3 Billion in funding. Click here to learn more about the full Health Technology market report.