Dive Brief:
- Venture capitalists have pumped $26.3 billion into healthcare startups this year, more than in all of 2012 and 2013 combined, Forbes reports.
- But while funding has soared, the number of deals has not. In the first 10 months of 2018, 1,540 startups reaped the cash rewards — slightly less than half the 3,103 deals in 2012 and 2013, when startups raised $22.3 billon.
- October deals totaled $2.69 billion across 126 companies, up 75% despite two fewer deals. The average take was $21.3 million, versus $12 million a year ago. The dealmaking analysis was conducted for Forbes by Pitchbook.
Dive Insight:
In the push to find the next workflow solution or advancement in care, lots of startups will fall by the wayside. But the volume of money flowing into healthcare shows investors are eager to back innovations that disrupt the way medicine is practiced and delivered.
The analysis echoes the funding momentum seen in other recent reports. In its third-quarter roundup of digital health venture capital activity, Rock Health counted 93 deals totaling $3.3 billion. The quarter brought 2018 funding to $6.8 billion, outpacing 2017's year-end total of $5.7 billion.
Among October's venture capital winners in the medical device and supplies space was SmileDirectClub. The direct-to-consumer teeth straightening startup raised $380 million in a round that included Kleiner Perkins and Spark Capital. The injection of funds boosted the Nashville-based company's valuation to $3.2 billion.
Another big winner was Medicare Advantage plan startup Devoted Health, which reeled in $300 million in a Series B round led by Andreessen Horowitz. The Waltham, Massachusetts-based company is currently valued at $1.8 billion.
In the biotech sector, genome engineering platform Synthego scored $110 million in a Series C round with Menlo Ventures and Yahoo co-founder Jerry Lang.
