Increasing venture-capital investment in digital health is helping startups accelerate their growth while also raising concerns that the market is overheating.
Venture investors pumped $14.7 billion into digital-health startups in the first half, topping the 2020 full-year total of $14.6 billion, according to Rock Health, a digital-health venture fund. Digital-health companies raised $7.7 billion in venture capital in all of 2019.
Startups have cashed in as the pandemic has steered more investors to healthcare and spurred the medical system to invest in digital-health tools, which include telemedicine, remote monitoring and technology to enable clinical trials to take place in patients’ homes.
“Covid exposed the lack of investment that health systems have made in technology,” said Sheila Talton, chief executive of Gray Matter Analytics Inc., a Chicago-based software company that helps…