U.S. funding for digital healthcare start-ups to reach $6.5 billion by 2017

U.S. funding for digital healthcare start-ups to reach $6.5 billion by 2017

Start-up funding for digital healthcare is expected to double in the United States over the next three years, growing from $3.5 billion in 2014 to $6.5 billion by the end of 2017, according to new research by Accenture.

“A digital disruption is playing out in healthcare that will change social interactions, alter consumer expectations and, ultimately, improve health outcomes,” said Dipak Patel, managing director of Accenture’s patient access initiatives.

Between 2008 and 2013, start-up funding totaled $10.2 billion for digital health solutions.Accenture estimates that around $2.8 billion was used to fund digital health start-ups last year, growing at an annual rate of 31% since 2008. The company projects digital health start-up funding will grow to $4.3 billion in 2015, and eventually hit $6.5 billion by the end of 2017.

Between 2008 and 2013, start-up funding totaled $10.2 billion for digital health solutions addressing four market segments:

  • Infrastructure capabilities, such as interoperability and health analytics, accounted for an estimated $2.9 billion in start-up funding, which was used to comply with industry changes and federal Meaningful Use guidelines.
  • Engagement solutions, such as wearable technology and incentive programs targeting behavioral change among patients, received $2.6 billion in start-up funding.
  • Treatment tools, such as telehealth, also received $2.6 billion in start-up funding.
  • Diagnosis technology captured $2.1 billion in start-up funding, for such clinical and consumer tools as remote monitoring.

Accenture’s forecast is based on market analysis, project experience, third-party analysis and data from 2,000 digital health start-ups receiving funding between 2008 and 2013. Pure-play medical devices, bio-tech, consulting/advisory firms and public companies are excluded from the research.