executive summary healthcare it funding and m&a · about mercom’s healthcare it funding and...

Q2 2015 Healthcare IT Funding and M&A Executive Summary

1 Copyright 2010-2015 | Mercom Capital Group, llc | www.mercomcapital.com | [email protected]

Executive Summary

Healthcare IT Funding and M&A 2015 Second Quarter Report

Funding and merger & acquisition activity for the

Healthcare IT / Digital Health sector

http://www.mercomcapital.com



About Mercom’s Healthcare IT Funding and M&A Report

Mercom was one of the first research firms to track funding and M&A activity in the Healthcare IT

sector, starting in 2010. We refer to the industry as “Healthcare IT” while others use terms such

as digital health or ehealth, among others.

Here is how our report is different: Our report includes deals of all sizes globally to present a

complete picture of Healthcare IT funding and technology trends. As an independent research

firm, we have no conflicts of interest with companies covered in this report.

• This is the most comprehensive report covering funding and M&A deals of all sizes,

globally. The trends revealed in this report give a more complete picture of the industry.

• This report does not cover bioinformatics and medical devices.

• All charts, graphs and trends are clearly categorized and defined by technology and sub-

technology groups.

• This report includes concise deal information for every transaction.

• This report covers historical trends.

• As the industry evolves, our report evolves with it and we continuously improve the

information, analysis, charts and trends covered every quarter.

Our subscribers include companies and executives from venture capital, private equity,

investment banking, healthcare, healthcare IT (aka digital health and eHealth), insurance,

healthcare associations, universities, tech firms and more.

Audience Why they like our reports

Venture Capital/Private Equity leads from early-stage deals, technology trends

Investment bankers leads for funding and M&A deals, investor leads

Healthcare IT, digital health sector trends, investor targets (by funding behavior, including

technology, technology partnership targets, and more)

Insurance companies acquisition leads, investment leads, technology partnerships

Large healthcare & Tech firms acquisition leads, R&D partnerships, investment leads

The report covers the technologies listed below and the sub-technologies under them.



Technologies Covered in This Report



• Venture Capital Funding in Healthcare IT companies in Q2 2015 rose to $1.2 billion in

138 deals compared to $784 million in 142 deals in Q1 2015.

1,714 956 1,212 784 1,197

159

212

134 142

138

0

50

100

150

200

250

0

300

600

900

1,200

1,500

1,800

Q2'14 Q3'14 Q4'14 Q1'15 Q2'15

Source: Mercom Capital Group, llc

Healthcare IT VC Funding Q2 2014-Q2 2015

Disclosed Amount ($M) No. of Deals

• Healthcare practice-focused companies, comprising Health Information Management

(HIM), Service Providers, Revenue Cycle Management and Security companies, raised

$473 million in 41 deals.

• Of practice-focused companies, HIM companies raised $391 million, Service Providers

raised $63 million and Security companies raised $19 million. Revenue Cycle

Management companies had no deals this quarter.

• Consumer-centric companies, which include Mobile Health, Telehealth, Rating/Shopping,

Personal Health, and Social Health companies, captured $724 million in 97 deals.

• Of consumer-centric companies, Mobile Health companies raised the most funding with

$214 million, followed closely by Personal Health companies which raised $209 million.

Telehealth companies raised $152 million, Rating & Comparison Shopping companies

raised $149 million and Social Health companies raised $100,000.

SELECT KEY

FINDINGS



391 214 209 152 149 6319 0.1

33

37

20 18 20

6

2

2

0

5

10

15

20

25

30

35

40

0

50

100

150

200

250

300

350

400

450

Health

Information

Management

Mobile Health Personal Health Telehealth Scheduling,

Rating &

Shopping

Service

Providers

Security Social Health

US$

in M

illio

n

Source: Mercom Capital Group, llc

Healthcare IT VC Funding Q2 2015 (By Technology)

Disclosed Amount ($M)

• Telehealth, Personal Health/Wellness, and Rating, Comparison and Shopping companies

all had their best fundraising quarter.

• The Top 5 VC deals this quarter were the $200 million raised by NantHealth, Virgin

Pulse’s $92 million raise and the $50 million each raised by Doctor on Demand and

MDLIVE.

• There were 15 countries with Healthcare IT VC funding activity this quarter. Most of the

funding came from the United States (80 percent).

• Within the United States, 37 deals originated in California, followed by New York with 13

deals and Massachusetts with 11.

• There were 39 early stage deals funded that were $2 million or below, including nine

Accelerator/Incubator deals.

• A total of 271 investors participated in funding deals in Q2 2015.

• Announced debt and public market financing in Healthcare IT was $1.6 billion in 8 deals

this quarter compared to the $975 million in seven deals in Q1 2015.



• There were four IPOs in Q2 2015.

• M&A activity in the Healthcare IT sector in Q2 2015 totaled 53 transactions (eight

disclosed) compared to 56 transactions (14 disclosed) in Q1 2015.



Introduction……………………………………………………………………….……...………. 3

Key Findings ……………………………….…………………………….……………… 5

2015 Healthcare IT Funding and M&A ……………………………….………………. 9

VC Funding 2010-2015 YTD…………………………………………………….……………… 9

VC Funding by Quarter …………………………………………………………………..….…. 10

VC Funding by Technology……………………………………………………………. 11

VC Funding by Sub-Technology……………………………………………………… 12

Health Information Management……….…………………….……..………. 13

Mobile Health…….…………….…………….………………………..………. 18

Personal Health….…………….…………….………………...……..………. 24

Telehealth…….…….………….…………….………………………..………. 26

Scheduling, Rating and Shopping………….……………..………..………. 30

Social Health…….…………….…………….………………………..………. 32

VC Funding by Stage……………..………………………………….….….…………. 33

VC Activity by Country…………..…………………………………………….……….. 34

VC Activity by U.S. States…………………………………….……………………… 35

Trends in VC Funding Large vs Smaller Deals.…………………………………….. 37

Top VC Funding Deals ……..……………………………….……...………….......... 38

Top VC Investors………..………………………………………..…………................ 39

Accelerators/Incubators………..……………………………….…………………........ 40

VC Deals………………………..………………………………….……………………. 41

VC Investors…….……………………..……………………………..…………........... 54

Debt and Public Market Financing….………………………………………………………… 68

Debt and Public Market Financing Activity ...…………..……………………………. 69

Debt and Public Market Financing Investors…………………………….................. 69

Initial Public Offering (IPO) ……………………………........................................... 70

Mergers and Acquisitions (M&A)………………………….…………………………………. 73

M&A by Technology………..…………………………………………..……….……… 74

M&A by Sub-Technology…..……..…..………………..………………………..…….. 75

Multiple Acquirers………..…………………………………………..……….………… 76

Top Five M&A Transactions……………………………………………..…………….. 77

Disclosed M&A Transactions…………................................................................... 78

M&A Transactions by Country…………................................................................... 79

M&A Transactions……….…………………………………………………….……….. 80

TABLE of

CONTENTS



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DISCLAIMER: © 2015 by Mercom Capital Group, llc. All rights reserved. Mercom hereby grants user a personal, non-exclusive, non-refundable, non-transferable license to use the Report for research purposes only. Mercom retains exclusive and sole ownership of all its Reports. When quoting from this report, please cite “Mercom Capital Group, llc”. Information contained in this publication is derived from carefully selected sources we believe to be reliable. Mercom its employees, affiliates, agents, and licensors do not warrant the accuracy, completeness, currentness, non-infringement, merchantability, or fitness for a particular purpose of this report. Nothing in this report constitutes or should be taken as investment advice. For information about this document, please contact us at 512-215-4452 or via email at: [email protected].

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