Record-Setting First Quarter for Digital Health Funding | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

Record-Setting First Quarter for Digital Health Funding

April 6, 2016
by Heather Landi
| Reprints
Click To View Gallery

2015 was considered to be the year that digital health funding hit its stride, and the first three months of 2016 have shaped up to be a record-setting first quarter.

Two new reports on digital health funding both indicate that digital health already has seen a number of large deals in early 2016, creating a big uptick in funding growth. Startup Health Insights reports that digital health had a record $1.8 billion in funding in the first quarter of 2016, while Rock Health estimates that digital health funding reached $981.3 million, the highest first quarter total since the company began tracking deals in 2011.

“Our data shows digital health funding experienced an uptick with 13 percent trailing twelve months (TTM) growth and almost 50 percent year over year (YoY) growth (when compared to 2015’s first quarter—a record year itself),” Mitchell Mom, venture associate at Rock Health, wrote.

According to Rock Health, the two largest deals of the quarter represented over 34 percent of the quarter’s transaction value and contributed to the largest average deal size ($18.2 million) since Q2 2015.

Both reports stated that activity in Q1 2016 point to an overall trend seen in the past few years with dollars and average deal size growing, yet the number of deals, or deal volume, is dropping.

Rock Health lists the five largest deals of the quarter as Flatiron Health ($175 million), a business and clinical intelligence platform for cancer care providers; Jawbone ($165 million) develops and sells wearable technology that provides personalized insights into how users sleep, move and eat; HealthLine ($95 million) uses a taxonomy-driven search platform to provide intelligent health information to individuals; Health Catalyst  ($70 million), a healthcare data warehousing provider and Higi ($40 million) provides kiosks that screen for a user’s blood pressure, weight, pulse, and body mass index.

Startup Health Insights’ report highlights that 2016 already saw four deals over $100 million, as compared to seven in all of 2015. In its list of the top 11 deals in Q1 2016, Startup Health Insights included insurance upstart Oscar Health, a $400 million deal, which put it in the top spot, and the report also included MindMaze ($100 million), Guardant Health ($100 million), eGym ($45 million), Captricity ($35 million), MedCPU ($35 million) and Soothe ($35 million).

Both reports stated that big data/analytics has become a very active market within digital health, as is population health. According to Rock Health, the top six categories for digital health funding in Q1 2016 were wearables and biosensing, with $202 million total; analytics/big data with $200 million; population health management with $107 million, consumer health information with $103 million, healthcare consumer engagement at $61 million and EHR/clinical workflow with $49 total in funding.

“The top six categories accounted for over 77 percent of the deal value for Q1 2016; only wearables and healthcare consumer engagement maintained a place on the list from the end of 2015,” Mom wrote.

According to Startup Health Insights’ report, the most active investors in 2016 include institutional venture capital organizations, as well as a hospital system and a payor, continuing the trend of previous years of a diverse investor base. “Large organizations ramp up their investments and begin placing bets as they increasingly look externally for innovation. With such a disruptive digital health landscape, looking outside the walls of an institution is becoming an important strategy,” the report stated.

The top five investors in the first quarter of 2016 were Khosla Ventures, UPMC, Startup Health, BlueCross BlueShield Venture Partners and GE Ventures, according to Startup Health Insights.


Get the latest information on Health IT and attend other valuable sessions at this two-day Summit providing healthcare leaders with educational content, insightful debate and dialogue on the future of healthcare and technology.

Learn More



Duke Health First to Achieve HIMSS Stage 7 Rating in Analytics

North Carolina-based Duke Health has become the first U.S. healthcare institution to be awarded the highest honor for analytic capabilities by HIMSS Analytics.

NIH Releases First Dataset from Adolescent Brain Development Study

The National Institutes of Health (NIH) announced the release of the first dataset from the Adolescent Brain Cognitive Development (ABCD) study, which will enable scientists to conduct research on the many factors that influence brain, cognitive, social, and emotional development.

Boston Children's Accelerates Data-Driven Approach to Clinical Research

In an effort to bring a more data-driven approach to clinical research, Boston Children’s Hospital has joined the TriNetX global health research network.

Paper Records, Films Most Common Type of Healthcare Data Breach, Study Finds

Despite the high level of hospital adoption of electronic health records and federal incentives to do so, paper and films were the most frequent location of breached data in hospitals, according to a recent study.

AHA Appoints Senior Advisor for Cybersecurity and Risk

The American Hospital Association (AHA) has announced that John Riggi has joined the association as senior advisor for cybersecurity and risk.

Report: Healthcare Accounted for 45% of All Ransomware Attacks in 2017

Healthcare fell victim to more ransomware attacks than any other industry in 2017, according to a new report from global cybersecurity insurance company Beazley.