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StartUp Health Insights Funding Report 2016 Year End

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2016 was the beginning of the health sector’s ‘Moonshot Movement.’ Thousands of entrepreneurs, industry leaders and investors, coupled with a generation of new industry entrants started to rethink the future of health. From Vice President Joe Biden’s Cancer Moonshot to speed up the progress in ending cancer as we know it, to The Chan Zuckerberg Initiative to cure all disease within 100 years, billions of dollars are being committed to health innovation - a mindset that exponential progress is possible.

Published in: Healthcare

StartUp Health Insights Funding Report 2016 Year End

  1. 1. © 2017 StartUp Health, LLC A StartUp Health Insights Report 2016 Digital Health Funding Rankings 
 Data from January 1, 2016 through December 31, 2016 Report is inclusive of seed, venture, corporate venture and private equity funding Sign up to receive weekly funding insights at startuphealth.com INCLUDING CAREGIVING FUNDING SPONSORED BY INCLUDING TOP MARKET FUNDING SPONSORED BY 2016: THE HEALTH MOONSHOT MOVEMENT TM
  2. 2. startuphealth.com/reports ABOUT STARTUP HEALTH Pages Topic 2-3 ………………………………………….…………… About StartUp Health 4 ………………………………………….…………… Year End Summary 5-18 ………………………………………….…………… Deals and Funding 19-20 ………………………………………….…………… Geography 21-23 ………………………………………….…………… Investors 24-25 ………………………………………….…………… Outlook 26-30 ………………………………………….…………… Caregiving 26 ………………………………………….…………… Methodology In 2011, StartUp Health introduced a new model for transforming health by organizing and supporting a global army of entrepreneurs called Health Transformers. With the world’s largest digital health portfolio (more than 180 companies spanning 5 continents, 16 countries and 60+ cities), StartUp Health is mobilizing this rapidly growing army along with the world’s ‘batteries included’ leaders, innovators and investors, to achieve 10 Health Moonshots, with a 25 year mission to improve the health and wellbeing of everyone in the world. Learn more about how you can join this movement and support Health Transformers at www.startuphealth.com. Jennifer Hankin Polina Hanin Troy Bannister Mark Liber Anne Dordai Nicole Kinsey Tara Salamone StartUp Health InsightsTM Contributors Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC Ali McDonough Niharika Gupta Rami Tal 2
  3. 3. startuphealth.com/reports 1 Access to Care Moonshots Delivering quality care to everyone, regardless of location or income 2 Cost to Zero Moonshots Radically reducing the cost of care by a factor of a million 3 Cure Disease Moonshots Curing disease using data, technologies and personalized medicine 4 Cancer Moonshots Ending cancer as we know it 5 Women’s Health Moonshots Prioritizing women’s health, including preventive care and new research 6 Children’s Health Moonshots Ensuring every child has access to quality care, particularly in underserved areas 7 Nutrition and Fitness Moonshots Providing access to a healthy environment and support an active lifestyle 8 Brain Health Moonshots Unlocking the mysteries of the brain to improve health 9 Mental Health and Wellbeing Moonshots De-stigmatizing mental health and connect mind, body and spirit 10 Longevity Moonshots Adding 50 healthy years to every human life 10 HEALTH MOONSHOTS THAT ARE CHANGING THE WORLD One of the most exciting trends to emerge is an ambitious generation of entrepreneurs, leaders and investors focusing on bold ‘Health Moonshots’. StartUp Health is organizing and supporting its global army of Health Transformers to focus on achieving 10 Health Moonshots with a 25-year mission to improve the health wellbeing of everyone in the world. 3Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  4. 4. startuphealth.com/reports DEALS & FUNDING GEOGRAPHY INVESTORS OUTLOOK “The urgency is now, it’s about changing the culture, it’s about coming up with a new strategy.” -Vice President Joe Biden, at StartUp Health’s Showcase at The Cleveland Clinic Medical Innovation Summit 2016 2016 YEAR END SUMMARY 2016 was the beginning of the health sector’s ‘Moonshot Movement’. Thousands of entrepreneurs, industry leaders and investors, coupled with a generation of new industry entrants started to rethink the future of health. From Vice President Joe Biden’s Cancer Moonshot to speed up the progress in ending cancer as we know it, to The Chan Zuckerberg Initiative to cure all disease within 100 years, billions of dollars are being committed to health innovation - a mindset that exponential progress is possible. 4 Over $8 Billion were invested in over 500 digital health companies alone. This staggering figure has fueled innovation across the board in medicine, infrastructure and consumer-driven health. Record-Breaking Digital Health Funding: 1 New Investors Pour In: More than 200 new investors entered the funding ecosystem in 2016, putting the total unique investors at almost 900. These investors come from a variety of institutions and geographies, beyond the traditional VC and angel investor, ranging from Fortune 500 to Private Equity. 2 Investors continue to support early-stage startups with hundreds of Seed and Series A Rounds this year. Investors Support Early Stage Innovation: 3 Big deals dominated 2016 with almost 25% of all funding invested into five deals. It’s no coincidence that companies receiving large amounts of capital like Onduo or Human Longevity Inc. are examples of companies with bold visions, setting out to achieve Moonshots. A Year of Mega Deals: 4 Almost 160 patient/consumer experience focused companies received funding in 2016 - between 2-3x as many as other subsectors. Patient engagement and behavior change remain largely unsolved problems and while these early stage companies continue to experiment, we look forward to new models and strategies emerging that incorporate lessons learned. Delivering Care & Content Receives Most Funding: 5 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  5. 5. startuphealth.com/reports 2010 2011 2012 2013 2014 2015 2016 Q1 Q2 Q3 Q4 DEALS & FUNDING GEOGRAPHY INVESTORS OUTLOOK 159 298 498 670 590 527 599 Deal Count $1.3B $1.8B $1.7B $611M $590M $494M $274M $8.1B $5.9B $7.1B $2.9B $2.4B $1.9B $1.1B Momentum across pharma, provider, payor landscapes have culminated in a record year of funding and ushered in a new wave of entrants. In today’s climate of political change, and uncertain policy future, there is little doubt from investors that the health sector is in its moment of creative destruction. DIGITAL HEALTH FUNDING SNAPSHOT: YEAR OVER YEAR 5 “We're in the midst of a revolution. Every 50 years you see a massive revolution in healthcare and the next one is due for 2020.” Kimberly Muller, Director of Technology Transfer, UC Innovations StartUp Health NOW! Episode #101 Over $8B have fueled new business models, increased demand, spurred a digital health revolution, and globalized what is now possible. CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  6. 6. startuphealth.com/reports DEALS & FUNDING OUTLOOK $0B $0.2B $0.4B $0.6B $0.8B $1B $1.2B 2010 2011 2012 2013 2014 2015 2016 $320M Series B $150M Series C $37.5M Venture $37.9M Venture $394M Venture $33M Series B $31M Series A $400M Series C $230M Series B $500M Series C R2 = 0.5564 $400M Venture $220M Series A Good Doctor $500M Venture DIGITAL HEALTH FUNDING SNAPSHOT: MONTH OVER MONTH GEOGRAPHY INVESTORS 6 Funding trends continue to oscillate but maintain a general positive incline over the long term. Although overall funding tends to slow down in certain months, some of the largest deals still occurred during those times (i.e. Human Longevity, Privia). $500M Series A “We're just at the beginning of what's possible.” -Dr. Douglas Wood, Medical Director, Center for Innovation, Mayo Clinic StartUp Health NOW! Episode #43 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  7. 7. startuphealth.com/reports DEALS & FUNDING OUTLOOK $0B $0.2B $0.4B $0.6B $0.8B $1B $1.2B Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2013 2014 2015 2016 In comparing monthly funding over the last four years, May and October are both breakout months for digital health funding, while June is the least active month on average. DIGITAL HEALTH FUNDING SNAPSHOT: MONTH OVER MONTH GEOGRAPHY INVESTORS 7 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  8. 8. startuphealth.com/reports DEALS & FUNDING OUTLOOK Patient/consumer experience focused companies have had the shortest time between Seed Rounds and Series A Rounds at 13.3 months, while big data/analytics focused companies are at the longer side of the spectrum at 17.5 months. Across the entire digital health industry in 2016, companies took and average of 14.5 months to raise their A Round. Number of Months from Seed to Series A Big Data / Analytics 17.5 mo Medical Device 16.7 mo Clinical Decision Support 15.1 mo Avg. time from Seed to A Round Patient / Consumer Experience 13.3 mo Personalized Health / Quantified-Self 15.9 mo FUNDING VELOCITY: FIVE SECTORS GEOGRAPHY INVESTORS “Raising money in healthcare is difficult. I think investors are still trying to figure this out. How to actually quantify what [startups are] saying. That's the biggest challenge.” -Eran Kabakov, CEO, Docola StartUp Health NOW! Episode #100 8 0 10 20 30 40 50 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  9. 9. startuphealth.com/reports DEALS & FUNDING OUTLOOK 2016 broke a trend in funding speed. Since 2013, we’ve tracked the window of time between companies’ Seed and Series A Rounds. Over the years, the amount of time between rounds became less variable until this year, when it developed a funding profile more similar to 2013. The data below is presented as medians. #ofMonths 0 5 10 15 20 25 30 35 40 2013 2014 2015 2016 FUNDING VELOCITY: SEED TO SERIES A BY YEAR GEOGRAPHY INVESTORS 9 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  10. 10. startuphealth.com/reports Company $ Invested Subsector Notable Investor 1 $500M Patient/Consumer Experience 1 $500M Patient/Consumer Experience Undisclosed 3 $448M Patient/Consumer Experience 4 $400M Wellness 5 $220M Personalized Health 6 $160M Wellness 7 $151M Patient/Consumer Experience 8 $145M Big Data/Analytics 9 $120M Patient/Consumer Experience 10 $100M Medical Device Undisclosed 10 $100M Medical Device 10 $100M Personalized Health DEALS & FUNDING OUTLOOK THE TOP 10 LARGEST DEALS OF 2016 GEOGRAPHY INVESTORS 10 Three of the top five deals in record were signed this year, demonstrating international commitment to supporting paradigm shifting ideas in digital health. CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  11. 11. startuphealth.com/reports DEALS & FUNDING OUTLOOK Company Location Subsector Notable Investor Palo Alto, CA Patient/Consumer Experience Dallas, TX Population Health Agoura Hills, CA Patient/Consumer Experience Palo Alto, CA Research Stockholm, Sweden Wellness San Mateo, CA Big Data/Analytics Sacramento, CA Big Data/Analytics Toronto, ON Wellness Montreal, QC Personalized Health/Quantified-Self New York, NY Big Data/Analytics Hong Kong Personalized Health/Quantified-Self Chicago, IL Workflow Boston, MA Patient/Consumer Experience Chicago, IL Workflow New York, NY Wellness CROSS SECTION: $10M DEALS GEOGRAPHY INVESTORS 11 Taking a look at a group of $10M deals, we can see a variety of companies that have managed to attract mid-level investments over the course of the last year. CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  12. 12. startuphealth.com/reports DEALS & FUNDING OUTLOOK Company Location Subsector Notable Investor Singapore Population Health Denver, CO Patient/Consumer Experience Dallas, TX Patient/Consumer Experience Tel Aviv, Israel Big Data/Analytics Chicago, IL Education/Training Flo Wilmington, DE Personalized Health/Quantified Self Los Angeles, CA Wellness Seattle, WA Research Helsinki, Finland Patient/Consumer Experience Akron, OH Medical Device New York, NY Medical Device Undisclosed Baltimore, MD Big Data/Analytics Irvine, CA Workflow Nashville, TN Patient/Consumer Experience Denver, CO Workflow CROSS SECTION: $1M DEALS GEOGRAPHY INVESTORS 12 An early-stage investment cross-section offers insight across an industry experimenting with maturing ideas. It’s interesting to take note of the varied investors, from population health to workflow supporting these young businesses. CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  13. 13. startuphealth.com/reports DEALS & FUNDING OUTLOOK Company Amount Subsector Notable Investor $220M Personalized Health / Quantified-Self $22.0M Wellness $13.7M Patient/Consumer Experience $10.0M Wellness $7.8M Medical Device $3.0M Clinical Decision Support $2.4M Research $2.1M Medical Device $2.0M Personalized Health / Quantified-Self $1.4M Medical Device StartUp Health Portfolio: Top 10 Deals GEOGRAPHY INVESTORS 13 The StartUp Health portfolio of 178 companies has raised over $300M in 2016. CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  14. 14. startuphealth.com/reports Patient/consumer experience was the most funded sector in digital health even the excluding the $1B funding raised by Onduo and Good Doctor’s. Even after excluding these two deals, it is still the most funded sector in Digital Health. DEALS & FUNDING OUTLOOK Subsector Total Raised YTD Deal Count Avg. Deal Size 1 Patient/Consumer Experience $2.8B 163 $17M 2 Wellness $1.0B 45 $23M 3 Personalized Health/ Quantified-Self $765M 47 $16M 4 Medical Device $713M 53 $13M 5 Workflow $593M 89 $7M 6 Big Data/Analytics $562M 54 $10M 7 Population Health $436M 52 $8M 8 Clinical Decision Support $332M 22 $15M 9 Research $280M 28 $10M 10 E-commerce $277M 17 $16M Domestically, risk bearing organizations find a lot of value in the ability to reach out, connect and educate those outside the walls of a hospital or office. Because of a lower barrier to entry, in comparison to a personalized health/ quantified- Self company, there are more companies emerging and competing within the market. There is still plenty of opportunity in this area and there will be a need for focused solutions to help people with any ailment. “One of the most exciting things in 2017 will be the continued emergence of blockchain technology in healthcare to power a more secure and transparent healthcare system. This could have a huge impact on everything from how we share and view medical records, to our claim processing and billing systems.” — Blake Walker, Co-Founder and CPO, Inbox Health THE TOP 10 MOST ACTIVE MARKETS OF 2016 GEOGRAPHY INVESTORS 14 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  15. 15. startuphealth.com/reports DEALS & FUNDING OUTLOOK 2010 2011 2012 2013 2014 2015 2016 0% 25% 50% 75% 100% Seed Series A Series B Series C Series D Series E Series F + G + H 31% 33% 7%22% 3% *Deal count only includes Seed though Series G rounds. Does not include venture rounds or growth equity. Deal Count* 124 237 304 450 391 300 344 2013 remains the year with the most early-stage investments at 74% or 331 deals. The last three years have remained strong with 2/3 of all deals being Seed or A Rounds. Steady Seed Round & Series A funding in 2016 was an encouraging sign that capital is still being distributed among early-stage digital health companies. DEAL ACTIVITY BY STAGE GEOGRAPHY INVESTORS 15 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  16. 16. startuphealth.com/reports We saw consistent market maturity in the patient/consumer experience, workflow, and personalized health markets, with the latter having the most late-stage deals. There were few clinical decision support, EMR, and e-commerce deals at the early stage. 47% Patient/Consumer Experience Wellness Personalized Health/Quantified-Self Big Data/Analytics Medical Devices Clinical Decision Support E-Commerce 32 32 21 4 4 15 15 11 5 1 9 12 13 0 1 11 11 5 2 0 11 10 5 6 0 11 9 6 3 5 7 11 2 0 0 8 6 6 2 4 1 3 4 3 0 0 4 2 0 1 2 0 0 0 0 0 1 1 1 0 Workflow Research Population Health EHR Education/Training Seed Series A Series B Series C Series D-H DEALS & FUNDING OUTLOOK MARKET MATURITY MAP 2016 GEOGRAPHY INVESTORS More funding activity Less funding activity 16 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  17. 17. startuphealth.com/reports 47% 163 112 56 22 13 108 113 60 25 11 108 61 27 10 8 62 61 36 28 21 54 73 48 16 13 50 45 32 18 15 45 50 27 9 5 44 43 36 30 25 37 37 16 6 6 21 31 14 5 5 15 10 8 5 8 18 9 4 4 4 DEALS & FUNDING OUTLOOK MARKET MATURITY MAP DEALS SINCE 2010 Seed Series A Series B Series C Series D-H Medical Devices Personalized Health/Quantified-Self Big Data/Analytics E-Commerce Research Clinical Decision Support Population Health Education/Training EHR GEOGRAPHY INVESTORS Patient/Consumer Experience Wellness Workflow 17 More funding activity Less funding activity CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC Reflective of 2016, our historic data shows concentrations in funding at early stage patient/consumer experience, workflow and wellness focused companies.
  18. 18. startuphealth.com/reports DEALS & FUNDING OUTLOOK Funding($M) $0M $10M $20M $30M $40M 2013 2014 2015 2016 Avg. Deal Size Avg. Seed Avg. Series A Avg. Series B Avg. Series C Average funding size has continued to march upwards, despite a 50% drop in Series C average. Series A rounds were 84% larger than in 2015 — or $1M above 2015’s total average deals. AVERAGE ROUND SIZES: 2013-2016 GEOGRAPHY INVESTORS 18 “We're excited that apps for health and wellness will become less of a novelty and more of an actionable way to take control of your life. There are currently many apps which track things like miles ran, calories, and other parameters, but what’s often missing is what this data means in terms of what the user should do. With advances in artificial intelligence, apps will be able to more effectively communicate whether it’s time for a day off from the gym, if you should run an extra mile, or if you should start consuming more orange juice to get the necessary vitamin C.” - Corey Mccarran, COO, Titanovo CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  19. 19. startuphealth.com/reports FrequencyofDealSize 0 50 100 150 200 $1M $5M $10M $25M $50M $100M $150M $200M $250M $300M $350M $400M $450M $500M 2014 2015 2016 DEALS & FUNDING OUTLOOK $500M $400M $448M $394M $500M $400M Good Doctor We are seeing an increase in deal count numbers overall: an increase of 8% in $5M deals, 26% in $10M deals and 7% in $25M deals. Four of the six deals above $400M in the last three years have occurred in 2016. ROUND SIZE FREQUENCY: FUNDING GIANTS GEOGRAPHY INVESTORS 19 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  20. 20. startuphealth.com/reports INVESTORS OUTLOOK Region 1 SF Bay Area 2 Boston Metro 3 New York Metro 4 San Diego 5 Los Angeles 6 Minneapolis/St. Paul 7 Philadelphia 8 Chicago 9 Salt Lake City 10 Washington, DC $105M $928M $970M $710M $1.5B San Francisco Bay Area Salt Lake City San Diego Metro New York City Metro Boston Metro $180M Chicago Metro $216M Minneapolis / St. Paul Metro $200M Philadelphia Metro (8 Deals) (7 Deals) (116 Deals) (15 Deals) (15 Deals) (17 Deals) (60 Deals) (35 Deals) Los Angeles Metro $468M (29 Deals) Washington, DC Metro $97M (9 Deals) Funding continues to be significant in the Bay Area and in the Northeast. In 2016, the metro regions of Boston and New York City yielded 208 deals (47% of all deals) and approximately $3.4B in funding (54% of all funding). DEALS & FUNDING GEOGRAPHY THE MOST ACTIVE US METRO AREAS OF 2016 20 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  21. 21. startuphealth.com/reports DEALS & FUNDING OUTLOOK NOTABLE INTERNATIONAL DEALS OF 2016 China $500M Patient/Consumer Experience Ping An Good Doctor $448M Patient/Consumer Experience Patient/Consumer Experience $120M $100M Medical Device $45M Wellness $45M Research Population Health $25M Patient/Consumer Experience $31M* * Total in 2 rounds of funding in 2016 $35M Medical Device INVESTORSGEOGRAPHY 21 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  22. 22. startuphealth.com/reports Firm 2016 YTD Deals 2015 Deals Stage Early Mid Late 1 18 10 2 15 9 3 10 2 4 9 6 4 9 6 6 8 3 6 8 7 8 7 3 9 6 7 9 6 5 9 6 4 DEALS & FUNDING OUTLOOK THE TOP INVESTORS OF 2016 INVESTORSGEOGRAPHY 22 We are seeing huge strides in new investors coming into the digital health scene. All of the top 10 investors of 2016 are either maintaining or increasing their involvement in the digital health Industry. CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  23. 23. startuphealth.com/reports 0 13 26 39 52 65 78 91 104 117 130 2010 2011 2012 2013 2014 2015 2016 2 3 4 5 6+ 1 In 2016, we saw the total investor count jump by 42% - a huge signal of a booming industry. Not only are more investors entering the scene, but they are also participating in more rounds than ever. 2016 brought investment from almost 900 unique firms, angels or investment arms - almost 300 more than last year. 208 318 343 517 617 609 865 InvestorCount # of Deals by Investor NUMBER OF INVESTORS YEAR OVER YEAR Total Investors 23 DEALS & FUNDING OUTLOOKINVESTORSGEOGRAPHY CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  24. 24. startuphealth.com/reports1 DEALS & FUNDING OUTLOOK We surveyed Health Transformers from the StartUp Health Academy about their fundraising experiences in 2016 and their predictions for 2017. 15% 35% 35% 15% <2 Months 2-6 Months 6 - 10 Months >10 Months How long did Health Transformers most 
 recent fundraising process last? 26% 16% 13% 26% 19% 1 - 5 firms 5 - 10 firms 10-20 firms 20-30 firms 30+ firms How many firms did Health Transformers pitch to while raising their last round? INSIGHTS FROM HEALTH TRANSFORMERS GEOGRAPHY INVESTORS N = 37 N = 37 24 “Digital health reflects the incredible technological progress of the 21st century. It is another industry revolution that we are lucky to witness and participate in.” - -Leon Eisen, PhD, CEO, Oxitone Medical CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  25. 25. startuphealth.com/reports1 DEALS & FUNDING OUTLOOK 1 “The change in access to care is going to be powerful and lead to happier and healthier people everywhere. I can't wait” “I am excited that there is more interest in Mental Health than ever before and changes are coming in federal regulations to increase the attention in this area. The gap between idea and implementation is a difficult one to bridge, which makes 2017 a truly exciting time to be an innovator in ‘aging-in-place’ technologies.” “If we change ourselves, the realities of the world will change. I look forward to the day where all people, of all diversities, break the boundaries between healthcare provider and patient and celebrate the truth that we are all patients and we all have a responsibility in creating a better, sustainable world- especially in Health. I'm most excited about our world taking action towards the advancement of understanding, the destruction of ideologies and judgements, and the growth of consciousness. I know that health will play a central role in this growth of mankind.” “I am thrilled to see that the healthcare ecosystem is being more receptive to AI and I am excited to see how our ecosystem really maximizes it to cut patient cost down and deliver better patient outcomes to all.” “The recent developments in technology in 2016 now allow medical entrepreneurs to enter the world of digital health with a much lower technological threshold.” “In 2017, we are most excited to see online healthcare increasingly become not only a tool to get quick online help from a doctor for a specific problem, but also a channel to deepen and extend your offline relationship with your preferred provider” “Imagine a world though, where you can be in NYC, Springfield or Mali and have access to an identical level of care” “2017 will be a year of big change and disruption. We will have to deal with some negative pressures but new opportunities can be born in such a high- pressure environment, and I believe that innovations by private companies and startups will fill the void created when the government steps back” GEOGRAPHY INVESTORS - Hunter Howard, Founder, President - Ansgar Bittermann, Founder, CEO - Coley Parry, Founder, CEO - Eric Price, Founder, CEO - Teddy Hodges, Founder, CEO - Beth Sanders, Founder, CEO- Jean Anne Booth, Founder, CEO - Maksim Tsvetovat, Founder, CTO - Alex Guastella, Founder INSIGHTS FROM HEALTH TRANSFORMERS 25 CAREGIVING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  26. 26. A Spotlight on Caregiving sponsored by Data sourced and provided by: * Data in following section is separate from StartUp Health Insights data * 26 DEALS & FUNDING OUTLOOKGEOGRAPHY INVESTORS CAREGIVING startuphealth.com/reports Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  27. 27. THE CAREGIVING INVESTMENT LANDSCAPE By 2020, 117 million Americans are expected to need assistance of some kind, yet the overall number of unpaid caregivers is only expected to reach 45 million. Technology holds great promise for helping to reduce the complexities, stress, and sheer hard work of these caregivers. Companies from established multinationals to startups, mass-market firms to niche players, are recognizing this caregiving market opportunity that’s expected to reach $72 billion in 2020 alone. 27 DEALS & FUNDING OUTLOOKGEOGRAPHY INVESTORS CAREGIVING startuphealth.com/reports Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  28. 28. startuphealth.com/reports OUTLOOKGEOGRAPHY INVESTORS 28 Category Raised YTD Deal Count Average Deal Size Notable Deal 1 Daily Essential Activities $7.7B 91 $84M 2 Care Coordination $803M 50 $16M 3 Health & Safety Awareness $798M 49 $16M 4 Caregiver Quality of Life $422M 43 $10M 5 Transition Support $168M 28 $6M 6 Social Wellbeing $113M 16 $7M There is a focus on funding technologies that make daily essential activities easier, including transportation, food delivery and other services that provide value to everyday tasks and errands. Uber continues to dominate the ‘on-demand’ transportation market with staggering investment numbers and is viewing the aging population as a growth opportunity. Care Coordination remains an established sector as technology begins to play a bigger role in the caregiving market. CAREGIVING MARKET INVESTMENTS CAREGIVINGDEALS & FUNDING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  29. 29. startuphealth.com/reports OUTLOOKGEOGRAPHY INVESTORS 29 CAREGIVING MARKET TOP DEALS While not counted in StartUp Health’s data as a digital health deal, Uber and several other top deals this year could have a significant healthcare impact on the aging community. There is a healthy mix of hedge funds, venture firms and other investor types interested in supporting the caregiving market. Notable Deal Total Raised YTD Notable Investor Category 1 $5.9B Daily Essential Activities 2 $500M Daily Essential Activities 3 $189M Daily Essential Activities 4 $175M Care Coordination 5 $141M Daily Essential Activities 6 $127M Health & Safety Awareness 7 $126M Daily Essential Activities 7 $111M Daily Essential Activities 7 $100M Caregiver Quality of Life 7 $100M Caregiver Quality of Life CAREGIVINGDEALS & FUNDING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  30. 30. startuphealth.com/reports OUTLOOKGEOGRAPHY INVESTORS 30 47% 45% 25 7 11 3 4 3 13 11 13 8 1 0 15 7 11 3 4 3 6 19 5 3 3 3 12 2 3 2 0 1 3 6 4 1 0 0 Seed/Angel Series A Series B Series C Series D Care Coordination Caregiver 
 Quality of Life Daily Essential Activities Health & Safety Awareness Social Wellbeing Transition Support The intersection of ‘Daily Essential Activities’ and Caregiving is where most of the investment activity is localized. Most deals across the Caregiving market are still in their earlier stages. CAREGIVING MARKET MATURITY MAP Series E+ CAREGIVINGDEALS & FUNDING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  31. 31. Traditional venture capital dominated the investment landscape in 2016, edging out Corporate VCs, PE firms and other types of investment organizations. CAREGIVING MARKET VENTURE INVESTORS OF 2016 YTD Firm 2016 Deals Notable Deal Stage Early Mid Late 1 8 2 7 3 6 3 6 4 5 31startuphealth.com/reports OUTLOOKGEOGRAPHY INVESTORS CAREGIVINGDEALS & FUNDING Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  32. 32. startuphealth.com/reports1 Sectors: • We have a broad view of digital health and believe that the current trend is a cross-pollination of technology and data with all aspects of health and healthcare. StartUp Health InsightsTM tracks companies that enable health, wellness and the delivery of care through data / analytics, sensors, mobile, internet-of-things, 3D printing and genomics and personalized medicine. • StartUp Health tracks companies based on their sectors, subsectors and specialties. Investments in subsectors and specialties are not mutually exclusive, as deals are tagged with multiple subsectors and specialties based on the company’s focus. • Q2 of 2015 brought with it an extensive database quality assessment. A new system was implemented allowing StartUp Health to track innovation with enhanced granularity. Additionally, gaps in funding data were researched and added into our database enabling us to identify fundings previously unaccounted for in previous reports. Stage of Funding: • StartUp Health InsightsTM records only publicly available data on cash for equity investments as the cash is actually received by the company. StartUp Health InsightsTM is inclusive of accelerator, pre-seed, seed, venture, corporate venture and private equity funding. • Early stage: The company has raised a Seed or Series A round • Mid stage: The company has raised a Series B or Series C round • Late stage: The company has raised a Series D or other growth equity round • StartUp Health also tracks incubator rounds and other financings into privately- held entities (e.g. “unnamed” venture rounds, strategic investments, growth equity and private equity). • In tabulating deal activity by stage we excluded rounds not clearly associated with a specific stage. Sources: • Funding data is from StartUp Health InsightsTM, the most comprehensive funding database for digital health, and managed by the StartUp Health team. Information, data and figures represent only publicly available data. • Data for acquisitions slide was provided by a range of sources including StartUp Health InsightsTM, CrunchBase, AngelList and news reports. • StartUp Health works to ensure that the information contained in the StartUp Health InsightsTM Report has been obtained from reliable sources. However, StartUp Health cannot warrant the ultimate validity of the data obtained in this manner. All data is subject to verification with the venture capital firms and/or the investee companies. Results are updated periodically. Therefore, all data is subject to change at any time. • If you find an error please let us know so we can correct it. This report is provided for informational purposes and was prepared in good faith on the basis of public information available at the time of publication without independent verification. StartUp Health does not guarantee or warrant the reliability or completeness of the data nor its usefulness in achieving any particular purposes. StartUp Health shall not be liable for any loss, damage, cost or expense incurred by reason of any persons use or reliance on this report. This report is a proprietary aggregation of publicly available data and shall not be forwarded or reproduced without the written consent of StartUp Health. METHODOLOGIES 32Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC
  33. 33. startuphealth.com/reports STARTUP HEALTH’S GROWING ARMY 33Source: StartUp Health Insights | startuphealth.com/insights Note: Report based on public data on seed, venture, corporate venture and private equity funding only. © 2017 StartUp Health LLC

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