Digital Healthcare Overview
Healthcare is an enormous industry but at the same inefficient too.Across the globe, growing markets and increasing demand for better healthcare makes digital healthcare the next big market for leading tech companies to exploit.
In the US, investors funded around $11 billion in digital health startups this year with most of the investments going into the area of health insurance, genomics and pharmacies. In China, the government is significantly investing in healthcare by treating it as a national priority because of the ageing population and demands for better care.
As the healthcare industry continues to evolve, the health focused companies aren’t the only ones interested in the digital health space.Leading tech giants have set their focus on digital health by continuing to make investments in niche digital health startups.
Digital Healthcare Strategy
When we look at the investments made by leading tech giants in the digital health space, the top 3 companies are Google, Microsoft and Tencent.The investment strategy of all the three tech giants are different.
- When we analyse Google’s investments in digital health space, most of these investments are done through its corporate funds, Google ventures and Gradient ventures.
- The latest acquisition has been Fitbit through which Google can collect massive amounts of patient data by using advanced AI/ML techniques to drive meaningful insights and commercialization.Google has also invested in Clover Health – A leading private health insurance firm that use innovative patient engagement models to differentiate from their peers.
- Google is also focusing its investments on Remote patient monitoring capabilities as that will be crucial to Google’s healthcare strategy in future to grow its clinical research.
- Microsoft has been investing in Digital health companies through its incubator/accelerator programs such as Microsoft scaleup and Microsoft AI factory.Microsoft work with these companies at a very early stages and most of these companies have been successful in raising additional funding.
- Microsoft also has a venture arm M12 that participates in late stage funding or in the Pre IPO rounds.Microsoft has pivoted its healthcare strategy from personal health data to enabling large healthcare organizations store and make use of their data to gather insights.Microsoft investments are primarily focused in Data Management and Analytics and Genomics companies.
- Tencent is a very active investor in Digital health startups. Most of these investments are based out of China.
- Tencent is focused on clinical research and administrative tools.Tencent is the category leader in Medical content and marketing.This is because of its We Chat platform which alone has 1.1 billion monthly active users. The company leverages its platform to offer valuable customer acquisition channels to these companies.
Other leading tech giants including Apple and Samsung have also been investing actively in digital health. Apple has pursued an acquisition focused strategy for its digital health investments and is focusing on personal health data management and monitoring.
Key Investment areas in digital healthcare
- As tech giants have increased their focus on digital health, there are some areas where more investments are happening. For instance, Clinical research has received huge traction followed by Data management and analytics.
- Content and marketing companies focus on building communities and creating content with ultimate goal of maximizing the traffic for healthcare companies.
- Startups developing assistive and rehabilitation tools use technology to assist people with disabilities and help patients restore functional abilities.
As healthcare is the major initiative taken by almost all governments globally to improve the health of its citizens and improve care, leading tech companies are placing strategic bets on digital healthcare startups across clinical research, genetics and drug delivery.