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Growth Evaluation: Early Stage Heath Tech Startups

Delivered February 5, 2020. Contributor: Agnidip M.

Goals

To examine the typical growth model of an early-stage health tech startup, focusing especially on companies approaching pharmacy chains and big box retailers as their sales outlets.

Early Findings

  • Noom is a health tech startup which is focused on creating behavioral health changes related to weight loss, fitness and certain chronic health conditions. Noom raised US$58 million in its latest funding round in 2019.
  • Noom witnessed a growth rate of 1,938% between 2016 and 2018.
  • Another health tech startup Med tech Solutions, which earned a revenue of US$16 million in 2016, grew by 152% between 2015 and 2018
  • Arcadia.io, a health tech startup focused on helping providers gain insights into value-based performance, grew by 133% between 2015 and 2018. The startup ended the financial year 2018 with a revenue of US$35.4 million.
  • According to research published in rockhealth.com, digital health startups are raising historically large rounds with the median size of a Series A digital health deal in 2019 being US$10million, up 11% from the $9million median in 2018 and two times the median for Series A in 2011.
According to industry experts, the growth of an early stage health tech startup is often restricted by the following factors:
  • Inability of the founders to plan for unexpected delays. However, there are several incubators helping start-ups with contacts and capital so that they do not run out of funds too early.
  • Often the founders fail to make their startup grow because they are not healthcare specialists and they try to do everything by themselves.
  • Another reason for failure stems from the fact that digital health start-ups often do not look closely at their consumers. Efficient collection of data on an individual patient’s behavior can be used efficiently to generate insight and inform the development of the product.

In addition to this public search, we scanned our proprietary research database of over 1 million sources and were unable to find any specific research reports that address your goals.

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