JMIR Publications

ABSTRACT

Background:

The rise of telehealth and telemedicine during the pandemic allowed patients and providers to develop a sense of comfort with telehealth, which may have increased the demand for virtual-first care solutions with spillover effects into venture capital funding.

Objective:

Our objective was to understand the size and type of digital health investments pre- and post-pandemic.

Methods:

We examined healthcare companies founded from 03/14/2019-03/14/2020 (pre-pandemic) versus those founded 03/14/2021-03/14/2022 (post-pandemic) according to Crunchbase, a publicly available database that catalogues information about investments. We used descriptive statistics to compare the characteristics of companies pre- and post-pandemic. We used a chi-square test to compare categorical variables and t-test for continuous variables. We conducted a Wilcoxon rank sum test to compare median funding amounts.

Results:

There were 2,714 healthcare companies founded “pre-pandemic” and 581 companies founded “post-pandemic.” Companies were similarly distributed across geographies pre- versus post-pandemic (p=0.71). Companies founded pre-pandemic had a significantly greater mean (SD) number of founders than those founded post-pandemic (1.75 (0.96) vs. 1.62 (0.88), p=0.02). The distribution of funding rounds differed significantly for companies founded pre- and post-pandemic (p<0.001). Distributions of companies across healthcare subcategories were significantly different pre- versus post-pandemic (p < 0.001). Companies founded post-pandemic were more likely to be labeled Artificial Intelligence (7.3% post-pandemic vs. 4.7% pre-pandemic) and Software (17.3% post-pandemic vs. 12.7% pre-pandemic).

Conclusions:

We demonstrate significant changes in the distribution of focus areas for companies founded before versus after the coronavirus pandemic, which suggests the ability of venture capital to respond to major health-related events. Clinical Trial: NA