Rock Health: Venture funding in 2015 surpassed $4.3 billion

By Aditi Pai
11:54 am

Venture funding in 2015 has reached $4.3 billion, right on track with 2014, according to Rock Health’s 2015 Year in Review report. There were 279 total deals this year and the average deal size was $15.6 million. Though the number of deals has decreased from last year, the average deal size is higher.

Rock Health only including funding deals that are above $2 million and the data is current as of December 8th.

The number of later stage deals also grew this year, which Rock Health says is an indicator that the industry is maturing. While seed and Series A deals still accounted for a majority of the deals, Series C deals represented 18 percent of deal volume and even later stage deals represented 25 percent of deal volume. Some 34 companies that raised a round in 2014 raised at least one more round in 2015.

The largest deals that Rock Health tracked came from NantHealth, ZocDoc,and 23andMe, which all raised more than $100 million. Two other companies, Virgin Pulse and Collective Health, which raised $92 million and $81 million respectively, were also at the top of the list.

Some 50 percent of digital health funding this year went into six categories. Companies focused on healthcare consumer engagement raised the most funding, $572 million. Wearables and biosensqng-focused companies raised $489 million, personal health tools raised $407 million, payer administration-related startups raised $252 million, telemedicine companies raised $243 million, and care coordination startups raised $208 million.

The number of investors also increased this year, to 336 venture firms investing in one deal, up from 289 last year. And 49 firms closed three or more deals. Some of the most active firms include Venrock, NEA, True Ventures, and Lux Capital, which all participated in five or more days this year.

Startups in San Francisco received the most funding, followed by Boston and New York. Other cities including Miami, Salt Lake, Orlando, and Denver are also starting to see more funding. Companies in those areas brought in more than $65 million in total funding, combined.

Rock Health also tracked 180 digital health M&A deals, including Welltok’s Predilytics acquisition, Optum’s acquisition of Audax, Genoa’s 1DocWay acquisition, and Weight Watcher’s Hot5 acquisition. The aggregate transaction value for disclosed deals reached $6 billion.

Notably, in 2015, the number of women-led companies that received funding doubled. Another way to look at it: More than 10 percent of companies that received funding had a woman CEO. Some of these companies included 23andMe, led by Anne Wojciki, Vitals, led by Hayward Donavan, and ClassPass, led by Payal Kadaki.

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