The latest CB Insights report tracking global health funding isn’t cheery reading for VCs and their young analysts, associates, and principals. CB’s tracking of Q3 spending, like Rock Health’s [TTA 5 Oct], indicates it’s Back to 2019–not even 2020–with funding of $4.6 billion snapping back to Q1 2019.
In CB Insights’ tracking, 2022 Q1 had funding of $16.1 billion with Q2 slumping to $7.2 billion. Q3 funding was a 36% drop from Q2. (Editor’s note: CB Insights tracks global funding, while Rock Health is US only, with lower totals.) The most affected sectors: clinical trials tech, telehealth, and health IT, though the last two still have high levels of funding.
Unlike Rock Health’s analysis, mental health funding is struggling with 72 deals, a small gain after two straight quarters of decline. CB also identified only three new unicorns (over $1 billion) in Q3: health startup accelerator Redesign Health (which since September has had some reverses), nurse staffing platform Incredible Health, both with $1.7 billion, and UK-based Spectrum Health, with $1.2 billion. M&A/exits have also slumped to 48, the lowest level in five years. IPOs were also down to seven.
It doesn’t look bright for Q4, especially when you look at the miseries of healthcare-related companies like Philips, which reported a €1.3 billion operational loss this past quarter and immediately moved to reduce its global workforce by 4,000. For the young analysts and associates who were just starting or advancing their careers in the VC field, it snapped shut with a suddenness that would make a crocodile envious.
Healthcare Dive, CB Insights (paywalled)
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