Health tech funding levels out as startups raise $2.5B in third quarter

Fund­ing for health tech star­tups might be start­ing to lev­el out.

Dig­i­tal health star­tups in the US raised $2.5 bil­lion across 119 deals, ac­cord­ing to dig­i­tal health re­search and ven­ture firm Rock Health’s Q3 2023 fund­ing re­port pub­lished Mon­day. It’s the sec­ond-low­est quar­ter by fund­ing to­tal since the fourth quar­ter of 2019, best­ing the $2.2 bil­lion to­tal of the third quar­ter a year ago.

The lat­est quar­ter fol­lows a trend of low­er fund­ing ac­tiv­i­ty fol­low­ing a peak in 2021 dur­ing the pan­dem­ic. In­vestors con­cerned about high in­ter­est rates, a slow­er econ­o­my and a lack of com­pa­nies go­ing pub­lic are do­ing few­er deals, ac­cord­ing to the re­port. Re­cent bank­rupt­cy fil­ings by pub­licly-trad­ed dig­i­tal health gi­ants Pear Ther­a­peu­tics and Baby­lon Health may have al­so shak­en in­vestors’ faith in the sec­tor.

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