Torrid Rate of Growth for Digital Health Funding

Editor’s note: This guest post was written by Dave Chase, the CEO of Avado.com, a patient portal & relationship management company that was a TechCrunch Disrupt finalist. Previously he was a management consultant for Accenture’s healthcare practice and founder of Microsoft’s Health platform business. He’s part of the White House Roundtable on Patient Access. You can follow him on Twitter @chasedave.

After investments in digital health doubled from 2009 to 2011, the torrid pace of growth has continued in the first half of 2012. Rock Health’s founder Halle Tecco stated why they released a report at this time. “The impetus of this report was the notable growth in venture funding of digital health–so much so that we are seeing 73% more investments than the same time last year. As we strive to foster innovation and entrepreneurship within the space, we want to best characterize the landscape to paint a clear picture of where our field is going.”

The following TechCrunch articles further explain the driving factors for this dramatic increase:

While there were a few $40M+ investments in the category, there was also a broad distribution of investors and investments.

68 digital health companies have raised over $2 million dollars in 2012 thus far
92 VC firms have invested in digital health startups so far in 2012

The report below provides additional detail on the distribution of investments and organizations involved.

The major buckets of investment include big data, home health, physician tool and sensors. The Bay Area continues to dominate funding with over $180 million in deals. Though mainstream media has been enamored with the story of what the Supreme Court will do with Obamacare, investors are voting with their wallets that the decisions made by 9 black-robed individuals is largely irrelevant to the disruptive innovators rapidly reshaping the industry landscape.