What’s Hot in Digital Health? The Venture Capital Perspective


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access user-generated data in aggregated and individual form to improve outcomes. They also see value in connecting directly with consumers for engagement and marketing. Ginger.io, Eliza, and Achievemint are all working on solutions in this sector.

Access to healthcare information and services: There is a supply and demand problem between patient needs and access to healthcare (including health information). Appointments are hard to book, doctors are often late, visits are too short, and post-visit follow-up is cumbersome. Companies that are emerging as market leaders are ZocDoc, which helps patients schedule appointments, and HealthTap, which helps patients get their questions answered by doctors online. One Medical Group is also a leader in this space, and MyHealthTeams is a personal favorite.

Tackling readmissions: Hospital Impact reports that one out of every five Medicare patients is readmitted to the hospital within 30 days of being discharged. Medicare has a new policy—called a Readmissions Reduction Program—that docks up to 1 percent of pay for hospitals with high readmission rates. This very real cost of readmissions, estimated at $17.5B/year, is an area that can be addressed in part by technology. Wearable sensors, wireless tracking of vital signs, two-way information flow, and automated discharge plans can all help.

Tools for doctors: Manhattan Research reports that 62 percent of doctors use iPads and over 85 percent use smartphones professionally. Although selling into hospitals can be a cumbersome, lengthy, enterprise sales process, many companies are developing applications and technology that doctors adopt directly. Doximity has created a large social network for connecting doctors and Airstrip is a leader in delivering patients’ clinical data to a doctor’s mobile device. Medigram offers a secure text messaging system for doctors and nurses.

Lowering corporate insurance premiums: As payers’ costs go up, they increase premiums to corporations, and corporations in turn pass along many of these fees to their employees. Payers would likely lower premiums if convinced that a workforce is healthier than the baseline or overall health is improving. Several companies, such as Keas, RedBrick, Bloom Health, and EveryMove are trying to measure employee health and improve it by incentivizing employees to lose weight or stop smoking.

The venture capital community is certainly still looking for companies pursuing FDA-approved therapeutics and devices, but the emerging sector of digital health is continuing to garner attention. Firms that have traditionally invested in both healthcare and IT have a distinct advantage in this converged sector, but we are now beginning to see traditional IT firms investing in companies that are out to disrupt the current healthcare paradigm. A lot of firms lost significant capital in the late 90’s and early 2000’s investing in healthcare IT, which at the time was mostly enterprise software for hospitals. This time around we expect real cost savings and data-driven improved outcomes with several long-standing companies built in the process.

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Skip Fleshman is a Managing Partner at Asset Management Ventures, which has invested in Health 2.0 companies such as CardioDx, HealthTap, Lark, Proteus Biomedical, and Maverix. Follow @SkipFleshman

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6 responses to “What’s Hot in Digital Health? The Venture Capital Perspective”

  1. Paul says:

    I would add that “access to healthcare information and services” is posing a problem on the provider to supplier side as well, not just the provider to patient.

    Healthcare reform has caused an in-balance in the supply and demand of medical device information and support to surgeons, which is impacting patient care and increasing healthcare costs.

  2. At HealthTech Capital, we focus on the “so what” and have invested in companies that fall in two big categories:
    1. help existing healthcare providers deliver care more cost effectively by leveraging technology like CareInSync to improve communication and collaboration of the care team.
    2. empower the patients to take charge via customized information tools like Wellness FX or MyHealthTeams
    All of those new companies have significant market risk and need to really understand who the stakeholders are and why they will change behaviors or pay for these new products.

  3. Paul Sonnier says:

    Great post, Skip!

    My only addition is that genomics is also part of the digital health “stack”. Here are the 8 super-convergence elements as identified by Dr. Eric Topol in “The Creative Destruction of Medicine: How the Digital Revolution Will Create Better Health Care”:
    – Wireless Sensors and Devices
    – Genomics
    – Social Networking
    – Mobile Connectivity and Bandwidth
    – Imaging
    – Health Information Systems
    – The Internet
    – Computing Power and the Data Universe (Big Data)

    Reference my Digital Health group on LinkedIn overview: http://linkd.in/DigitalHealthGroup


  4. Mahesh Jain says:

    Please visit http://curatio.in that meets several of your objectives. Also visit and like facebook page http://www.facebook.com/Curatio.i?ref=ts&fref=ts

  5. EMR-Matrix says:

    Very cool EMR matrix (http://www.emr-matrix.org) has some EMR meets 2.0 features.

  6. Great article, and mostly spot on. It should be emphasized, however, that investors are still shying away from technologies related to “scary” topics like end-of-life care and patient engagement during critical/end-of-life care situations. Too bad, because that’s one of the spaces where healthcare IT could have the most impact on quality of care, readmissions avoidance, and lowering costs.