Where's the Money Being Invested in Healthcare?

December 4, 2018
Panelists Jodi Hubler, Conor Green, and Jeremy Pierotti

In 2018, the healthcare industry ranked number two on the list of top sectors to raise funds, second only to internet companies. It’s a prime time to invest in healthcare as the industry benefits from an aging population and capitalizes on innovation. From drug makers and medical device manufacturers to companies developing technologies used to deliver healthcare, the industry is rife with areas to invest. Read on for the highlights from Conor Green at TT Capital Partners, Jodi Hubler at Lemhi Ventures, and Jeremy Pierotti at Sansoro Health.

Investment in Healthcare Tech

  • Digital wellness is a big movement causing many new companies to offer integration of data from wearable tech into EMRs, but few have actually asked providers if they have any interest in that data. It will become much more useful once companies determine how to improve health outcomes with that information. Integration of data for data’s sake doesn’t make it relevant.
  • Lemhi Ventures recently invested in Bind, a company pioneering on-demand health insurance that allows people to pay only for the coverage and services they need.
  • Actionable information is the holy grail for healthcare tech companies. Hot investments include companies that offer clinical decision support and analytics at large.

The Next Bubble?

  • Availability of capital is keeping a lot of companies alive. Is it too freely available? Probably. Are we on the brink of the next bubble? Probably not. The difference versus this scenario and the internet bubble is most venture firms are reasonably invested and more insulated.
  • Across healthcare, around 40 – 50% of people are one-time investors known as “dabblers.”
  • ‘Medical entertainment’ is the difference between services that inform and services that entertain. An example of this, 23andMe launched with celebrity “spit parties” to identify customer risk profiles through genetic testing.

Minnesota - The Good & Bad

  • There’s no reason why Minnesota shouldn’t be the dominant hub for digital health innovation. We boast great community-based health systems, leading med tech companies in the world, and a highly educated workforce.
  • The challenge of raising capital in Minnesota is significant. Investors on the coasts are tired of funding Bay-area companies, but still view the Midwest as flyover region.
  • Biggest room for improvement? Stop being so conservative about trying new things! It will help the broader Minnesota industry if people loosened their purse strings and invested in innovation locally.

Convergence is Happening

  • The Walt Disney Company collaborated with Texas Children’s Hospital to reinvent the patient and family experience.
  • Bose released mild-medium hearing aids (despite the fact that they could be partially to blame for hearing loss!).
  • Amazon announced a health system API where they use AI to turn unstructured data to structured data for just $0.01 per block of text.

Closing Thoughts

It’s tough to think of another industry going through such monumental change. Healthcare is undoubtedly going to continue gaining the attention of investors, but is it sustainable?

Extra Credit

Bind On-Demand Health Insurance. Learn more about Lemhi Ventures latest investment, Bind, a company that puts the power of designing health benefits coverage in your hands.

Amazon Confirms It’s Working on a Project to Mine Patient Records. Amazon is working with partners in health care on a project called Amazon Comprehend Medical, which involves analyzing medical data.

Disney ‘Imagineers’ to Customize Texas Children’s Hospital. Disney announced that it will donate $100 million over five years to redecorate children’s hospitals with its characters and storylines.

Bose Hearing Aid Gets FDA Approval. The USFDA approved audio technology company Bose to market a new hearing aid device, dubbed the Bose Hearing Aid.

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