Funding in digital health continues to skyrocket, reaching new heights in Q1 of 2014, according to a new report from Rock Health, a company that provides funding and full-service support to start-up companies.
Rock Health reports that nearly $700M in funding poured into digital health companies in Q1 of 2014, which represents impressive 87 percent year-over-year growth from Q1 of 2013. The average deal in the first part of 2014 was worth $13.1 million, up from $10 million in 2013. The highest number of investments went into payer administration ($120 million), analytics and big data ($107 million), and telemedicine ($61 million).
The biggest deal went to MedHOK (Medical House of Knowlege), which provides a platform for care, quality, and compliance for payers and accountable care organizations (ACOs). In total, it got $77.5 million from Bain Capital Ventures.
The second biggest deal with to MindBody, which provides scheduling and analytics tools for alternative health and wellness providers ($50 million) and the third went to Health Catalyst, the St. Lake City company that provides data warehousing to various providers. Sarasota, Fla.-based Voalte got $36 million from Bedford Capital for its communication systems.
California was the big winner this quarter in terms of locations, with companies from there representing 32 percent of all funding in the quarter. It was followed by Florida and Massachusetts.
In a recent interview, Paul Teitelbaum, managing director and medical device / healthcare IT mergers and acquisitions expert at Mesirow Financial, a Chicago-based investment banking firm, predicted that venture capital money in digital health will continue to rise in 2014.