Access to healthcare has long been an issue in the U.S., but the sheer magnitude of the problem became apparent during the early days of the COVID-19 pandemic. Numerous digital health startups stepped in to address the plethora of issues, and for a few quarters, VCs flocked to back them.
Many of those startups are still focusing on the same things, like telehealth primary care or chat-based therapy, but there’s little visibility into the adoption and customer acquisition they’ve seen. It’s clear investors aren’t so sure either: VC investment in digital health dropped to just $3.4 billion in Q1 2023 from a peak of $15.1 billion in Q2 2021, according to CB Insights.
I’m not saying the sector is dead in the water by any means, but the founders still finding success are doing far more than merely building off their peers. A recent fundraise illustrates clearly what VCs are finding attractive in the sector, and the types of startups that m …
