Digital healthtech start-ups especially in tele-health and wearables attracted a sizable venture capital (VC) investment in June and September quarters of 2020 with Covid-19 pandemic being a major catalyst.
A total of 25 companies attracted VC funding of $84 million in the two quarters when the Covid outbreak was at its peak. This was as against $57 million in previous two quarters. Some of the start-ups that raised VC funding include Practo, Muse Wearables, BestDoc and Dozee, according to Mercom Capital Group.
VC funding has risen globally as digital health is seen as a solution to help combat the Covid-19 pandemic. The funding activity increase in India over the past couple of quarters reflects the global trends. Use of digital health has become essential, especially telehealth, online scheduling, mobile health apps and the use of wearables, said Raj Prabhu, CEO of Mercom Capital Group, a global communications and consulting firm providing industry market intelligence reports covering digital health.
VC funding in digital health
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Covid-19 has been the catalyst for the investment surge in digital health technologies. Continuing with the trend seen in Q2, telehealth continues to be the biggest beneficiary of Covid-19 in terms of surging doctor visits, funding from investors, IPOs, and M&A activity. Investors do not seem to be worried about investing at the peak of the markets or sky-high valuations, he added.
The pandemic has been a catalyst for the investment surge in digital health technologies. Consumer interest and usage of fitness apps and wearables have increased during lockdowns and working from home, while social distancing has pushed patients to telehealth visits instead of in-office doctor visits.
‘Appetite for HealthTech’
Agreeing with Prabhu, Arun Natarajan, Founder of Venture Intelligence, which tracks private company financials and transactions, said while Edtech startups have hogged the headlines in terms of attracting mega investments, there has also been a growing appetite among VC investors for funding HealthTech start-ups.
While the B2C tele-medicine start-ups like Practo and DocsApp have attracted the larger investments in the sector, recent months have also seen smaller investments going into niche start-ups like Biomoneta (whose technology helps creates germ-free zones) to BestDoc (CRM software for hospitals) to ColMed (medical equipment purchase portal), he added. – The Hindu BusinessLine