Market Overview

Digital Health Breaks Funding Records with $10.3 Billion in the First Nine Months of 2020, Reports Mercom Capital Group

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Telehealth companies received a record $1.4 billion in Q3 2020

Mercom Capital Group, llc, a global communications and research firm, released its report on funding and mergers and acquisitions (M&A) activity for the Digital sector for the third quarter (Q3) and first nine months (9M) of 2020. Mercom's report covers deals of all sizes from across the globe.

Full report

Global VC funding for Digital Health companies in 9M of 2020 broke all previous 9M funding records, bringing in $10.3 billion (B). Funding activity was up by 43% during 9M 2020 compared to $7.2B in 9M 2019.

In Q3 2020 Digital Health companies raised $4B in VC funding in 195 deals, a 43% increase quarter-over-quarter (QoQ) compared to $2.8B in 161 deals in Q2 2020. Year-over-year (YoY), VC funding was up by 100% compared to $2B in 155 deals in Q3 2019.

Chart: Digital Health VC Funding 9M 2016-9M 2020

"Digital health and especially telehealth, has taken off amid COVID-19 and VC funding has already surpassed funding raised in any full year to date. There were five IPOs in digital health, which is unprecedented and we also had one of the biggest M&A deals in digital health history in the third quarter," said Raj Prabhu, CEO of Mercom Capital Group.

Top-funded categories in 9M 2020 were: Telemedicine with $3.2B, Data Analytics with $1.3B, mHealth Apps with $970 million (M), Wearable Sensors with $703M, Clinical Decision Support with $660M, Healthcare Service Booking with $572M, Practice Management Solutions with $553M, and Wellness with $523M.

Chart: Top-Funded Digital Health Categories

Telehealth companies received a record $1.4B in 41 deals in Q3 2020 compared to $962M in 50 deals in Q2 2020. Funding increased 118% YoY in Q3 2020 compared to $653M in 14 deals in Q3 2019.

Chart: Telehealth VC Funding

Early round venture capital funding (Seed, Series A) came to $1.2B in 9M 2020, with most going to Telemedicine, mHealth Apps, Data Analytics, Wellness, and Clinical Decision Support companies.

A total of 601 investors participated in funding deals in Q3 2020. A record 1,522 investors participated in 9M 2020.

Chart: Digital Health – Top VC Funding Rounds

Twenty-one different countries recorded Digital Health VC funding deals in Q3 2020, with U.S. companies recording the most with 129.

In 9M 2020, a total of 132 Digital Health M&A transactions were announced compared to 125 in 9M 2019. In Q3 2020, there were 49 M&A transactions compared to 34 in Q3 2019.

Practice Management Solution companies were involved in the most M&A transactions in 9M 2020 with 15. Data Analytics, mHealth Apps, and Telemedicine companies each recorded 14 transactions.

Notable M&A transactions in 9M 2020: Teladoc Health acquired Livongo Health for $18.5 billion, Blackstone acquired Ancestry for $4.7 billion, Invitae acquired ArcherDX for $1.4 billion, Healthcare Merger Corporation acquired Specialists On Call (dba SOC Telemed) for $720 million, and Teladoc Health acquired InTouch Health for $600 million.

Chart: Digital Health M&A by Major Category

Chart: Top Digital Health M&A Transactions by Disclosed Amount

This report is 115 pages in length, contains 67 charts, graphs, and tables, and covers 892 investors and companies.

Mercom's comprehensive report covers deals of all sizes across the globe.

Get the report

About Mercom Capital Group

Mercom Capital Group, LLC is a global communications and research firm focused on digital health, cleantech, and financial communications. Visit http://www.mercomcapital.com to signup up for our market intelligence reports.

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