From healthcare data analytics to cost transparency software to mobile diabetes management, companies in the global Health IT (or what folks will also refer to as digital health or healthcare IT market) are seeing increasing interest from investors. Over the last four quarters, the industry has seen $2.65B of funding across 628 financing transactions and funding rose to its highest quarterly amount ever in Q1. Over the three-month period, investors deployed $1.11B across 181 deals – a funding increase of 210% compared to the same quarter last year.
Big Checks to Health IT Companies
Earlier this month, Fortune reported that NY-based oncology data company Flatiron Health was in the process of raising a nine-figure financing round led by Google Ventures. Such an investment would be the latest in a string of large financing rounds to the health IT ecosystem. In fact, Q1 2014 saw 18 different companies raise funding rounds over $10M including Khosla Ventures-backed Quanttus, NEA and IBM-backed Welltok and Merck GHI Fund and Windham Venture Partners-backed WellDoc. Highlighted below are the 10 largest U.S.-based funding rounds from Q1 to Health IT companies.
U.S. dominates health IT investments
Over the past five quarters, over 80% of all deals in the digital health and health IT markets went to U.S.-based companies. Prominent international hubs that have seen 10+ deals since 2013 include Canada, which has seen deals including Phemi Health and Figure1, and China, which counts Matrix Partners-backed Meet You and Shenzhen Capital-backed Ledong IT among its funded digital health companies.
California dominates U.S. funding and deal levels
When it comes to U.S.-based investments in the health IT space, California overwhelmingly leads deal activity. Q1 saw California take 49 deals, the equivalent of 27% of all digital health and health IT investments in the three-month period. As typical in overall VC activity, New York and Massachusetts round out the top 3 by deal totals.
Interestingly, Florida saw the second highest amount of investment in the health IT space by funding in Q1 driven by a handful of notable deals (highlighted above).
The Social+Capital Partnership, Khosla Ventures most active over past five quarters
Among VCs and corporate venture groups, The Social+Capital Partnership and Khosla Ventures have invested in the highest number of unique companies, followed by Andreessen Horowitz. Close behind is corporate venture arm, Qualcomm Ventures, which has invested in companies including WellTok, Practice Fusion and FitBit.
For more digital health & healthcare IT financing and exit data and interactive rankings, check out the CB Insights Venture Capital Database and the Industry Analytics tool to see Digital Health trends. Sign up for free below.