Top Investor Firms in Health Technology

Top Investor Firms in Health Technology

Health technology is becoming one of the prime investment categories for investors in startup companies. In 2010, when the Affordable Care Act came out, there were 17 funded companies tackling health-care problems. In 2013, this number rose to 89, and in 2014, Forbes contributor Kay Koplovitz named health care IT a major investment option for the future.

This year’s midyear review by Rock Health suggests that digital health funding continues to grow.

Funding surpassed $2 billion in the first half of the year alone, which is close to the entire amount of last year’s funding. Some later stage companies have started taking on venture capital, too. For example, Jawbone and NantHealth received at least $1.3 billion in funding in the first six months of 2015.

Some of the Major Investors in Digital Health

Rock Health’s report for 2015 showed that digital health companies received funding from 330 investors, 108 of them choosing to fund this industry for the first time. 

Rock Health, a company that started five years ago, is praised for being the first venture fund specializing in digital health. It counts Omada Health — an innovator in the field of digital therapeutics dedicated to chronic disease management and lasting behavior change — as one of its first portfolio companies.

Launchpad Digital Health was named a top digital health investor for 2015.

The company offers startup [one word] capital of $200,000 to $500,000 and mentoring that is exclusively aimed at digital health development.

Atlas Venture invests both in life sciences and technology. Founded in 1980, it looks for investments in the United States as well as in Europe, and offers venture capital that does seed, early stage venture, late stage venture and private equity.

  Last year, together with Novartis, Atlas Venture launched gene-editing upstart Intellia with $70 million of funding.

HLM Venture Partners are known for investing in health-care technology, medical device and diagnostic companies, and technology-enabled health-care services. The company has been around for over 30 years and its partners helped to build some of the first companies in the health technology sector. HLM Venture Partners do traditional financial sponsoring, as well as invest on behalf of hospitals, health care foundations and pharmacy chains.

New Enterprise Associates promotes itself as a global venture capital firm with offices across the United States, as well as in China and India. As one of the largest capital venture firms in the world, NEA is committed to global developments in health care and technology. In May, they announced collaboration with Austrian VC Speedinvest, which will secure $50 million for European-based startups.

Venrock is an investment company of the Rockefeller family with a long tradition.

It invests in public health care and late-stage private health-care companies.

Physic Venture took its name from the Latin word for “science of healing” and works in the areas of health and sustainability. The firm looks for investments that could contribute to a better life and a healthier planet.

Major Themes in Digital Health Funding in 2015

Fifty percent of all digital health funding in the first half of 2015 was distributed among six categories. Unsurprisingly, the top place was taken by wearables and biosensing, followed by analytics and Big Data as a joint category. Consumer engagement took third place. Telemedicine received $169 million and ranked fourth, and corporate wellness at $128 million was the No. 5 investment option. Electronic health records (EHR) were also on the list of major investment themes supporting the growing trend of EHR use in American health care.

From a geographical perspective, companies from California, especially those in the Bay Area, continue to receive over half of all funding for health technology.

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