E-health, slowdown in startup investments. Europe at stake
In the first quarter of 2022, global deals are worth $ 10.4 billion, down 36% on a quarterly basis. In the Old Continent, the decline is 19%. The United States leads by value of operations and innovative companies. India runs in Asia
20 Apr 2022
Global investments in digital health startups fell 36% to $ 10.4 billion in the first quarter of 2022 compared to the fourth quarter of 2021. With $ 7.2 billion deployed by investors in 329 operations, the states United remains the first country in the world for loans to companies that develop technologies for the medical and pharmaceutical sector, but with a quarterly decline of 37%; in Europe 946 million was invested in 120 deals and the quarterly decline is more contained (-19%). This is what the “State of digital health” report, first quarter 2022, by Cb Insights reveals.
The decline in the value of investments is also linked to the halving of the maxi-operations, that is the financing rounds over 100 million dollars. The mega-deals for digital health startups totaled 4.4 billion dollars, equal to 42% of all investments in digital health compared to 57% in the fourth quarter of 2021.
In the field of digital health, Cb Insights includes IT companies for health, those of telemedicine and technologies for clinical research.
Index of topics
• Global Trends: 6 new unicorns, all in America
• The European ehealth deals
• In the US, the value of the companies financed is growing
• Global data: the collapse of Asia
Global trends: 6 new unicorns, all in America
The decline in investments in e-health is generalized in all the regions studied (USA, Canada, Asia and Europe) but with a drop in Asia (-55%). Other sectors also suffered from a decline in funding compared to the previous quarter, but to a lesser extent than digital health; for example, for fintech the contraction is 18% and for technologies aimed at retail by 11%.
The M & A remains very active, albeit in contraction: 138 agreements that confirm the trend of the sector towards consolidation.
On the other hand, IPOs fell: only one (in Asia) in the first quarter compared to 23 in the fourth quarter of 2021. No SPACs compared to 6 in the previous quarter. The decision to postpone the quotations is mainly due to the disappointing results of last year’s IPOs.
Finally, six digital health startups achieved unicorn status in the first quarter, with an overall valuation of $ 9.5 billion. They are less than half of the unicorns “born” in the last quarter of 2021 and they are all based in America, to be exact 5 in the United States and 1 in Chile. It is Somatus (valued at 2.5 billion dollars), ConcertAi , Transcarent, Athelas, Betterfly, Omada Health.
In total, there are 91 digital health unicorns in the world, of which 63 in the US, 8 in Europe and 18 in Asia. The top ten of the unicorns with the highest rating sees a US domain with Devoted Health (USA, 12.6 billion), Tempus (USA, 8.1 billion) and Caris Life Sciences (USA, 7.8 billion) at the top. The largest European unicorn is the French Doctolib (6.4 billion), sixth in the top ten, preceded by the Chinese We Doctor (7 billion).
The European ehealth deals
In the whole of 2021, 6.7 billion dollars were invested in digital health companies in Europe.
In our continent, even in the first quarter of 2022, most of the investments continue to support the early-stage development of health technology companies (76% of all operations). The biggest deals were scored by the German Patient21 (142 million dollars, Serie A) and by the Swiss MindMaze (105 million, Serie C); followed by the French Padoa (90 million, private equity) and the Swiss DistalMotion (90 million, Serie E).
France is the country with the most digital health companies financed in the first quarter, but the largest investors come from Germany and the United Kingdom: at the top is the German Global Founders Capital with 7 deals, followed by the British Hikma ventures, Mmc ventures and Seed capital, all with 4 deals each.
In the US, the value of the financed companies is growing
In the US, half of the loans in the first quarter of 2022 were early-stage and early stage companies saw their valuation increase on average by 36%. In addition, on average, US digital health companies increased their valuation 4.5 times in the first quarter of 2022 compared to the previous funding round.
The most important deals were the rounds for Somatus ($ 325 million, Series E), TigerConnect ($ 300 million, private equity) and Freenome ($ 290 million, Series E). There are 76 M&A agreements, but zero IPOs against 5 prices in the fourth quarter
three of 2021.
The largest investors by number of deals were General Catalyst (12 deals) and Gaingels (11), but Google Ventures with 5 deals also appears among the big names.
In the whole of 2021, more than 48 billion dollars were invested in health technology companies in the United States.
Global data: the collapse of Asia
In Asia, $ 1.3 billion was invested in 153 deals with digital health companies in the first quarter of 2022, representing a decrease of 55% compared to the fourth quarter of 2021. 64% of the capital financed early- internship.
The companies that have attracted the most funding come from India, China and Israel. The biggest deal in the first quarter was that of the Indian MediBuddy ($ 125 million, Series C), followed by the Israeli MeMed (93 million, Serie C) and the Chinese SiBionics (79 million, Serie C).
The largest investor is the Indonesian East Ventures with 7 deals, followed by Chinese investors: Sequoia capital China (5), Qiming venture partners (4).
COMMENT: Many startups smoke rather than roast. For this reason, investors are starting to become Genoese (well-known savers ..)