Venture capital (VC) funding in the healthcare IT sector almost doubled in 2013, growing to $2.2 billion across 571 deals, from $1.2 billion across 163 deals in 2012, according to the latest research from Mercom Capital Group.
The sector also managed to raise $648 million in debt and public market financing, notes Mercom, bringing the total corporate funding raised by the sector to nearly $3 billion.
“After record fundraising totals in 2013, healthcare IT companies have now received $4 billion in venture funding since 2010,” said Raj Prabhu, the chief executive of Mercom.
“Mobile health companies led the way in 2013 as the technology transformation of the healthcare industry continues.”
Mercom says that “consumer-centric” companies raised a total of $1.1 billion in 2013, with mobile health companies – the biggest recipients of VC funding – raising $564 million altogether.
So-called “personal health” companies received a total of $198 million, with social-media companies receiving $166 million.
Meanwhile, “practice-centric” companies raised $1.1 billion in 2013, with “population health” specialists receiving $179 million, electronic medical record/electronic health record (EMR/EHR) companies generating $166 million and practice-management organizations bringing in $162 million.
Mercom also revealed the identities of the five companies that received the most VC funding in 2013.
Topping the list with funding of $100 million was Evolent Health (Arlington, VA, USA), a “population health management services” organization that aims to support health systems in executing “population health and care transformation objectives”.
Practice Fusion (San Francisco, CA, USA), a web-based EMR provider, managed to raise $85 million in two deals, while Fitbit (San Francisco, CA, USA) – which develops fitness and health-tracker devices – fetched $73 million in two deals.
Rounding out the top five were MedSynergies (Irving, TX, USA), which provides revenue and performance management solutions to healthcare companies, and Digital Health (Redwood City, CA, USA), which has developed a “digital health feedback system”.
MedSynergies raised $65 million, while Digital Health took $45 million.
In the US, California was unsurprisingly the state that led healthcare IT fundraising, with 134 deals, followed by New York, with 48, Massachusetts, with 39, Texas, with 29, and Tennessee, with 26.