In a well-known chorus, digital well being corporations proceed to interrupt funding data, elevating a complete of $14.7 billion within the first half of 2021.
For the reason that begin of the Covid-19 pandemic, extra buyers have turned their consideration to digital well being corporations. To date, the pattern doesn’t appear to be letting up.
Within the first half of the 12 months, corporations raised a complete of $14.7 billion throughout 372 offers, based on a report launched right this moment by Rock Well being. By comparability, they raised $14.6 billion in 2020 — a document for the time — and simply $7.7 billion in 2019.
Massive funding rounds, led by personal fairness corporations and development funds, fueled the record-breaking numbers, accounting for greater than half of the entire. Tiger International Capital has not been shy about its plans to put money into digital heath, and led 14 funding rounds to date this 12 months, together with huge investments in billing platform Cedar and digital bodily remedy startup Hinge Well being.
A number of the largest funding rounds to date this 12 months embrace:
Extra corporations plan huge exits, however returns decline
Whereas extra corporations continued to line up for giant exits, the image seems to be a bit of bit totally different than it did earlier this 12 months. A complete of 11 corporations have gone public to date this 12 months, and one other 11 are lined as much as go public via mergers with special-purpose acquisition corporations (SPACs). However digital well being corporations that lately went public haven’t carried out as effectively lately as their predecessors.
Of the 18 digital well being corporations that went public on the New York Inventory Trade and the Nasdaq for the reason that starting of 2020, their common inventory returns fell beneath Nasdaq ranges within the second quarter, based on the report. In the meantime, people who went public earlier than the pandemic usually carried out on-par or higher than the Nasdaq common.
It’s additionally doable that the passion for SPACs will wane, given a extra scrutiny from regulators, and a waning variety of targets to take public. By Rock Well being’s depend, there are 39 SPACs actively looking for healthcare targets and 47 extremely capitalized digital well being startups, which means “sharp elbows are more likely to emerge” as they compete for corporations’ consideration.
Photograph credit score: aurielaki, Getty Photos