2016 is on track to be the biggest year yet for digital health funding. Q3 was significant with almost $2.4B in deals, nearly half of which were international. We continue to see the market expand globally, with several large deals taking place both in the US and overseas.
1. 2016 Grows in US and Globally: Digital health funding continues to grow in 2016, with an increase this year internationally. Early stage deals remain active with new investments flowing into Seed and Series A companies. Several late-stage deals have also been record-breaking, with two $500M rounds.
2. Digital Health's First Wave: The digital health sector is very much in its first wave of innovation, with much of the activity still at the earliest stages and too few success stories. With several significant deals this quarter(and year), both in the US and globally, expect to see more breakouts as the market matures and we enter a second wave of health innovation.
3. An Active Investor Ecosystem: Over 500 unique investors poured capital into digital health so far this year. And 140+ investors put money into multiple deals in 2016, a sign of a diverse investor ecosystem.
4. Unique Collaborations: A $500M investment by Google and Sanofi has broken ground on a very interesting relationship meant to tackle one of the world's greatest challenges: diabetes. This collaboration comes with very specialized expertise from both parties. Expect more unique collaborations as companies come together to focus on solving big health challenges ranging from Alzheimers and cancer to healthy aging and brain health.
5. The Rise of the Rest: While the Coasts continue to attract the majority of capital in digital health, we are seeing deal counts pick up this quarter in places like Minnesota, Tennessee and Florida. New ecosystems are slowly growing and investors are increasingly supporting startups from places that previously have been overlooked.