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Does the digital health startup you are thinking of investing in, and that is what you are doing when you partner or purchase their product have enough cash to get off the ground?

FTA

In the first half of the year, companies raised a total of $14.7 billion across 372 deals, according to a report released today by Rock Health. By comparison, they raised $14.6 billion in 2020 — a record for the time — and just $7.7 billion in 2019.

Some of the biggest funding rounds so far this year include:

While more companies continued to line up for big exits, the picture looks a little bit different than it did earlier this year.

Digital health companies that recently went public haven’t performed as well recently as their predecessors. Of the 18 digital health companies that went public on the New York Stock Exchange and the Nasdaq since the beginning of 2020, their average stock returns fell below Nasdaq levels in the second quarter, according to the report. Meanwhile, those that went public before the pandemic generally performed on-par or better than the Nasdaq average. Digital health companies that went public in 2020 or 2021 performed worse than the Nasdaq average in recent months, according to Rock Health.

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Cash if fuel in the startup world. The runway for these digital health startups is long. Does your startup have enough fuel to get off the ground?

#heatlhcare #healthIT #cio #cmio #chime #himss 

Digital health companies smash another funding record, raising $14.7B in first half of the year

Transcript

 This transcription is provided by artificial intelligence. We believe in technology but understand that even the smartest robots can sometimes get speech recognition wrong.

  Today in Health it, this story is Digital Health Company smash another funding record in the first half of the year. My name is Bill Russell. I'm a former CIO for a 16 hospital system and creator of this week in Health it a channel dedicated to keeping Health IT staff current and engaged. Thursday, tomorrow at 1:00 PM Eastern Time, I'm doing a webinar on the state of health it.

I'd love to have you on the call. I'll be taking about 30 minutes to talk about the state of health. It taken straight from our interviews, and we will be taking questions for at least 20 minutes during the webinar, trying to facilitate a discussion more than a talking head presentation. I'd love to have you join me.

Sign up today at this week, health.com/. Register. Alright, here's today's story. This comes from Med City News. Digital health companies smash another funding record raising $14.7 billion in the first half of the year. And I'm just gonna go to excerpts and then we'll do the so what And the first half of the year, companies raised a total of 14.7 billion across 372 deals, according to a report released today by Rock Health.

By comparison, they raised 14.6 billion in 2020. A record for the time and just 7.7 billion in 2019. Large funding rounds led by private equity firms and growth funds fueled the record breaking numbers. Accounting for more than half of the total Tiger Global Capital has not been shy about its plans to invest in digital health and LED 14 funding rounds so far this year, including big investments in billing platform, CER, and digital therapy startup Hinge Health.

Some of the biggest funding rounds so far this year include Diet App Noom, which raised 540 million direct to consumer Startup Row ro, which raised 500 million in March, drug discovery startup in Citro, which raised 400 million. In March as well. More companies plan big exits, but returns decline while more companies continue to line up for big exits, the picture looks a little more different than it did earlier this year.

A total of 11 companies have gone public so far this year, and another 11 are lined up to go public through mergers with SPACs. But digital health companies that recently went public haven't performed as well. As their predecessors of the 18 digital health companies that went public on the New York Stock Exchange and Nasdaq since the beginning of 2020, their average stock returns fell below NASDAQ levels in the second quarter according to the report.

Meanwhile, those that went public before the pandemic generally performed on par or better. Than the NASDAQ average digital health companies that went public in 2020 or 2021 performed worse than the NASDAQ average in recent months according to rock health. Alright, and it concludes. It's also possible that the enthusiasm for SPACs will wean, given a more scrutiny from regulators.

And a waning number of targets to take public by rock health's count. There are 39 SPACs actively searching for healthcare targets and 47 highly capitalized digital health startups, meaning sharp elbows are likely to emerge as they compete for companies attention. All right. What's the so what here, and I'm gonna talk about this from the health system provider perspective, and I'm reminded of something I learned earlier in my career when I participated in a turnaround situation.

Companies don't go out of business because they aren't making a profit. They go out of business when they run out of cash. Cash is king in the startup world. Don't get overly focused on profits of the companies you are investing in and make no mistake. , that is what you're doing. When you purchase a product from one of the funded startups, focus on their cash flow.

How far will their cash flow take them and what are their plans to get more cash to sustain operations? Healthcare startups take a long time to get off the ground. They burn a lot of fuel to get off the ground. And fuel for a startup is cash. Don't invest unless you know they have a plan to keep fuel in the plane.

Until they get off the ground. That's all for today. If you know of someone that might benefit from our channel, please forward them a note. They can subscribe on our website this week, health.com, or wherever you listen to Podcast. Apple, Google Overcast, Spotify, Stitcher. You get the picture. We are everywhere.

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