2021 opened with a whirlwind of SPAC-triggered public exit activity in digital health. In this post, we share insights and analysis on how digital health’s SPAC boom will impact four different stakeholder groups, as well as implications for the entire ecosystem.
Q1 2021 closed with $6.7B in US digital health funding, the most-funded quarter to date. Average deal size ballooned to $45.9M (up from $31.7M in 2020), and SPACs continued to offer a new path to liquidity, with 10 announced or closed SPAC deals. With growing deal sizes, a faster funding pace, and new exit pathways, we’re in a period of heightened opportunity.
2020 was the biggest year yet for the digital behavioral health market with companies raking in a record $2.4B in venture funding. This piece explores four key trends that currently define this market: (1) investors pouring more money into later-stage deals, (2) a burgeoning market for generalist and specialist approaches, (3) consolidation for clinical expansions and digital capabilities, and (4) investment opportunities for substance use disorder and developmental disorder solutions.
Rock Health and the Stanford Center for Digital Health are excited to release findings from the sixth annual Consumer Adoption Survey. Amidst a national pandemic and the ensuing stay-at-home orders, consumer adoption rates grew significantly from 2019 to 2020—10+ percentage point increases—across live video telemedicine, wearable ownership, and digital health metric tracking. The 2020 survey data suggest that consumers more than ever expect technology to be an integral part of their healthcare experience.
From information access to proof of vaccination, digital health solutions are popping up to meet this crucial phase of COVID-19 vaccine distribution. Rock Health Consulting shares insight on efforts underway and where there is still unmet need.
Now what? With 2020 in the rearview mirror we break down the forces that will shape the trajectory of digital health over the next twelve months. We explore four themes that will impact digital health this year.
2020’s stress test to our healthcare system created what felt like a fast forward button for digital health, with unprecedented growth in funding, adoption, policymaking, and national attention. Venture capital dollars flowed to US digital health companies at a new all-time high, with over $14B invested across 440 deals. 2020 also represented a thematic shift in liquidity for digital health venture investors, with upswings in both IPO and M&A activity. While questions remain about a new equilibrium for the digital health market, this post explores four factors underpinning what we see as a durable investment sector: sustained commitment from investors, new consumer behavior change, rising enterprise buyer appetite, and a breakout exit market.
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