VC Funding in Healthcare IT ContinuesRecord Growth in Q2 2013 With $623Million, Reports Mercom Capital Group
Funding in Consumer-Focused Companies Surge
AUSTIN, TX--(Marketwired - Jul 16, 2013) - Mercom Capital Group,llc, a global communications and consulting firm, today released itsreport on funding and mergers and acquisitions (M&A) activity in theHealthcare IT sector for the second quarter of 2013.Venture capital(VC) funding in the sector continued its rapid growth inanother record quarter with $623 million (M) raised. There were 168funding deals this quarter compared to 104 the previous quarter and 163in all of 2012.Healthcare ITVC Funding Chart:http://mercomcapital.com/assets/images/Charts/HIT-Q2-2013/Chart_1.png
"VC funding in Healthcare IT is now on pace to exceed $2 billion in2013," commented Raj Prabhu, CEO of Mercom Capital Group. "Thegovernment's initiative to open up healthcare data has been a contributor to the surge in activity and investments in consumer-focused companiesas they turn available data into usable applications and services."The marked shift of VCmoney going from practice-focusedtechnologies towards consumer-focused technologies in Q1 has pickedup pace this quarter with consumer-focused companies receiving twicethe amount of funding ($416M in 112 deals) compared to practice-focused companies ($207M in 56 deals).Proteus Digital Health, a digital health feedback system provider, raised$45M to make it the largest recipient of funding. lifeIMAGE, a network for securely sharing medical images and related health information,raised the second highest amount in the second quarter when it closed a$35.6M Series C round. Blue Health Intelligence, a healthcare data andanalytics company, raised $35.5M. WorldOne brought in $35M andWatermark Medical, closed out the Top 5 with $32.2M.Top 5 VC Chart:http://mercomcapital.com/assets/images/Charts/HIT-Q2-2013/Chart_2.pngA total of 161 investors participated in Q2 2013 includingaccelerators,incubatorsandcrowdfunding platforms. Eleven investors participated inmultiple funding rounds in Q2 2013. Ascension Health Ventures was themost active investor with three deals. The remaining top investors participated in two deals apiece, including: BlueCross BlueShieldVenture Partners, AIB Seed Capital Fund, Cardinal Partners, EnterpriseIreland, Galen Partners, Khosla Ventures, Lemhi Ventures, MilestoneVenture Partners, New Enterprise Associates, and SV Angel.
Consumer-focused anddigital healthcompanies specializing in apps,wearable devices and sensors, remote monitoring, patient engagement,rating/shopping, and social health networks for physician-to-physician, physician-to-patient and patient-to-patient were all prominent thisquarter, whereasmedical imaging,data analyticsandEHR/EMR companies were among the practice-focused technologies that receivedattention this quarter.M&A activityin the Healthcare IT sector dropped in Q2 2013 with 30transactions of which only two were disclosed compared to Q1 2013,with 46 M&A transactions of which only five were disclosed.Healthinformation Management companiesattracted the most acquirers with14 transactions followed by service providers with seven acquisitionsand mobile health with three in Q2 2013.Disclosed Healthcare IT M&A Transaction Chart:http://mercomcapital.com/assets/images/Charts/HIT-Q2-2013/DiscM&AChart.jpgThe two disclosedM&A transactionsin Q2 2013, included Jawbone,which acquired BodyMedia, for more than $100M and Instem, whichacquired Logos Holdings, along with its subsidiaries Logos EDCSolutions and Logos Technologies, for $7.7M.To learn more about the report, visit