Funding for digital health start-ups, especially in mental health, fall substantially in Q1’22

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Glob­al dig­i­tal health fund­ing falls 36% with few­er megarounds, IPOs (Fierce Healthcare):

After two years of record-break­ing invest­ment in dig­i­tal health, cap­i­tal flow into the sec­tor took a dive in the first quar­ter of 2022.

The glob­al dig­i­tal health mar­ket saw fund­ing decrease 36% from the fourth quar­ter of 2021, total­ing $10.4 bil­lion, as investors react­ed to sup­ply chain woes, the Russ­ian inva­sion of Ukraine and a volatile stock mar­ket, accord­ing to a new CB Insights report.

While all tech sec­tors received small­er fund­ing totals than the pre­vi­ous quar­ter, dig­i­tal health plunged much fur­ther than oth­ers did … investor inter­est in men­tal health tech wavered as the mar­ket and pub­lic com­pa­nies like Talk­space and Cere­bral come under scruti­ny. Men­tal health tech fund­ing fell 60% from the pre­vi­ous quar­ter, hit­ting $792 mil­lion, the low­est fund­ing lev­el for the sub­sec­tor since the fourth quar­ter of 2020…

The quar­ter could indi­cate a slow­er year for dig­i­tal health star­tups over­all as the pan­dem­ic-induced fund­ing fren­zy takes a back­seat. Ana­lysts expect M&A activ­i­ty to hold steady, but exter­nal fac­tors may con­tin­ue to rock the glob­al pub­lic and pri­vate markets.

The Report:

State of Dig­i­tal Health Q1’22 Report (opens link at CBIn­sights website):

  • Descrip­tion: After a record-break­ing 2021, glob­al dig­i­tal health invest­ment cools in Q1’22. Glob­al dig­i­tal health fund­ing reached $10.4B in Q1’22, down 36% from the pre­vi­ous quar­ter. In our State Of Dig­i­tal Health 2021 Report, we dig into glob­al invest­ment trends to spot­light keytakeaways.

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