Investors Bet Big on Digital Health

Investor funding for digital healthcare ventures during the first three quarters of 2021 has already far outpaced last year’s levels, surpassing $20 billion for the first time, according to Rock Health, a venture capital firm that specializes in health startups.

The COVID-19 pandemic has fueled demand for digital care, and last year was the first time funding in the sector topped $10 billion, reaching $14.6 billion, according to Rock Health.

This year, the sector has already attracted $21.3 billion in investments during the first three quarters of the year, with the largest share of funding going toward research and development, at
$4.7 billion, and on-demand healthcare and treatment of diseases, each of which topped $3 billion.

Among clinical indications, mental health was the clear winner, bringing in more than $3 billion in investments. Investors are also plowing money into companies focused on women’s health, such as menopause support and tailored behavioral healthcare. Another growth area is digital health that aimed at closing the gaps that lead to healthcare disparities.

“Investors and entrepreneurs are betting on strong, consistent growth in the adoption of healthcare innovation, and these expectations are materializing in increased funding patterns across all stages,” said the Rock Health report.