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Over the past few years, the healthcare tech sector has experienced dramatic change. The global pandemic has been a launch pad for innovative solutions and the digitization of the healthcare industry.
From Tonic Health, a real-time mobile patient intake and contactless check-in platform, to Eden Health, which keeps people productive and healthy with personalized, full-spectrum primary care and mental healthcare navigation, innovative healthcare startup technologies are knocking on every door.
Great news if you have a novel service model that will push the boundaries of delivering healthcare. But it won’t be a cakewalk as healthcare startups face unique challenges – from regulations and data protection to trials and testing…which often means getting the idea beyond the concept phase boils down to your ability to secure high-quality funding.
Thankfully healthcare VCs can play a crucial role in funding and supporting startups that are driving change and creating new opportunities. But who’s who, and where do you have the best chances? Fear not, because I will pull back the curtain on the A-list of healthcare VCs leading the way in investment in this article.
Three unique things make this article a thoughtful and informative piece that is unparalleled in its insights:
Healthcare VCs are crucial in funding and supporting startups that aim to drive change and innovation in the healthcare industry. Here is Sterling’s list of Best 10 healthcare VCs and their selection criteria:
Andreessen Horowitz is a venture capital firm that invests in all stages of a company’s growth, from seed stage to IPO. They focus on innovative healthcare startups that have the potential to transform the industry. They emphasize the importance of technology and innovative business models to drive healthcare innovation.
Notable Program Companies:
General Catalyst is a venture capital firm that seeks to invest in seed, early-stage, and growth-stage technology startups. They offer mentorship, advice, and resources to help founders scale their companies. The firm was founded in 2000 and is headquartered in Cambridge, Massachusetts, with additional offices in New York City, Palo Alto, and San Francisco.
General Catalyst invests in companies across several sectors, including consumer and retail, healthcare, energy, and technology. The firm typically invests between million and 0 million in its portfolio companies, taking minority or majority stakes in those companies.
General Catalyst has invested in several notable companies over the years, including:
Bessemer Venture Partners is a global venture capital firm that invests in various industries, including healthcare. They invest in startups that can deliver innovative solutions to healthcare challenges, such as those related to diagnostics, therapeutics, and medical devices. They emphasize the importance of the team and seek out companies with an experienced and dedicated team.
Khosla Ventures is a venture capital firm that invests in early-stage and growth-stage companies tackling big healthcare challenges. They look for startups developing innovative technologies and business models to improve the quality of care, increase access, and reduce costs.
Ventrock is a venture capital firm that invests in early-stage and growth-stage companies across a range of industries, including healthcare. They look for startups that are developing innovative solutions to healthcare challenges, such as those related to therapeutics, medical devices, and digital health. They emphasize the team’s importance, the business model’s strength, and the potential for significant market impact.
Define Ventures is a venture capital firm that invests in early-stage healthcare companies focusing on digital health and medical technologies. The firm was founded in 2018 and is headquartered in San Francisco, California. Define Ventures works closely with its portfolio companies to navigate the complexities of the healthcare industry and provide guidance on growing and scaling their businesses. They have a deep network of healthcare industry experts and investors to help their portfolio companies succeed.
Define Ventures invests in healthcare companies across multiple sub-sectors, including digital health, genomics, and medical devices. The firm typically invests between $500,000 and $3 million in its portfolio companies and actively supports those companies as they grow.
Providence Ventures leverages the deep healthcare industry expertise of its parent company, Providence St. Joseph Health, to support its portfolio companies in scaling their businesses and achieving their goals. The firm also fosters collaboration between its portfolio companies and Providence St. Joseph Health’s clinical teams to develop and implement innovations that improve patient outcomes.
7wire Ventures is a venture capital firm focused on investing in innovative healthcare solutions. They specialize in early-stage investments and have a selection process based on three main criteria: the size and potential of the market, the strength of the team, and the ability to generate revenue. They look for startups that have the potential to disrupt the industry and improve care delivery.
Maverick Ventures is known for its focus on innovation and disruption, leading the way in emerging technologies and investing in unicorns that are transforming their respective industries. The firm has a deep network of industry experts, entrepreneurs, and investors that it leverages to support its portfolio companies in building successful businesses.
GV (formerly known as Google Ventures) is a venture capital firm that invests in a range of industries, including healthcare. They are interested in startups that are using technology to transform healthcare delivery, improve patient outcomes, and reduce costs. They invest in early-stage and growth-stage companies.
Take a Deeper Dive Into TurnKey's Offshore Software Development Services and Discover How We Can Help Your Health Startup Grow.
After seeing the list, your brain might be screaming, “Show me the money!” but hold on to your horses. Now that you know “the who,” let’s talk about “the how,” starting with VC selection criteria.
Healthcare VCs have a rigorous process for choosing the startups they fund.
They are interested in three kinds of innovations that:
When considering potential investments, they analyze many metrics that take into account the market demand, competition, and the potential for growth and success, including:
Expert Tip: If this list is similar to the one you already Googled, check out this fantastic panel discussion from the Health and Bio Summit I discovered while researching. It’s well worth the watch! Then rejoin me for the five critical things to prepare BEFORE approaching VCs.
By considering these criteria, healthcare startups can evaluate which healthcare VCs best suit their needs and increase their chances of securing funding and support.
Since you have read this far, I thought I would throw in this checklist to get you started in evaluating healthcare VCs as potential investors:
Knowing where to apply is only half the battle. As the competition is fierce, preparation is the key to securing funding. You definitely don’t want to show up to this gunfight with a knife. Here are the five critical things healthcare startups need to prepare before applying for funding resources:
By now, you have likely spotted the reoccurring theme (ok, I’ve been relentlessly hammering you over the head) that a strong team is the key to securing funding successfully. This is even more important in 2023, as VC funding for early-stage startups has decreased, and investors are now putting their money into more established, working businesses.
However, with the ongoing short supply of tech talent, the harsh reality is that many tech startups’ dreams have died because VCs didn’t think their tech team had what it takes. So here are some ways to deal with the tech talent hurdle to keep your dreams off life support:
A professional development team is critical for the success of any startup, particularly those operating in the tech industry. These teams are responsible for developing and managing the company’s technological infrastructure, including digital tools, software, and other technical solutions. A strong development team can create cutting-edge products or software that sets your business apart from its competitors. At the same time, the wrong development partner could lead to mediocre products and missed milestones.
This is where VC firms come in. In addition to funding, many venture capital firms offer mentorship, strategic guidance and access to industry connections that can provide valuable support to young startups. Qualified VC firms have exposure to various software development partners like TurnKey across a range of industries and verticals. With their deep knowledge of both the software development process and the tech industry, VCs can serve as trusted advisors to startups looking for the perfect development partner.
At TurnKey, we partner with top healthcare VCs to help startups hire software developers offshore and find the perfect team for their needs. Since we have a robust screening process for every candidate, we hire only the top 3% of talent in Eastern Europe and Latin America.
Offshore software development has become an increasingly popular option for startups in the healthcare industry. By transferring work to a team outside of their home country, health startups can benefit from reduced labor costs and access to a broader pool of talent. Offshore software development teams can be beneficial for health startups in several ways:
Offshoring can be a cost-effective way for health startups to access skilled resources. By outsourcing work to a team in a country with a lower cost of living, startups can save money on labor and infrastructure costs.
Offshoring also gives health startups access to a larger pool of talent. By tapping into a global talent pool, startups can find skilled professionals with diverse backgrounds and expertise to support their development and operations.
Offshoring can help health startups improve productivity and efficiency. By delegating tasks to a dedicated offshore team, startups can free up their local team to focus on core business activities and accelerate their growth plans.
TurnKey is a leading offshore software development company specializing in helping startups find the perfect dedicated development team to support their business needs. Here are some of the ways that TurnKey can help health startups:
As previously mentioned, a strong team is essential to securing funding. So once TurnKey starts working with a startup and establishes their dedicated development team, they can confidently tick off this box for VCs. This has been a game changer for many clients, including MiResource, which provides search directories that help people find the right mental health care.
Being able to hire high quality engineering talent quickly is a game changer for any early stage startup. TurnKey has made that possible for us and we are proud that it is one of our company’s strengths.
TurnKey maintains an extensive network of experienced professionals from various countries with different skill sets. Startups can select from a pre-vetted pool of candidates to find the perfect team that best suits their needs.
TurnKey’s custom recruiting is optimized to ensure that startups can quickly find and onboard their offshore team saving $63K on retention per year. From sourcing talent to conducting interviews and managing payroll and HR support, TurnKey streamlines the entire recruitment process.
TurnKey works closely with startups to ensure that the offshore team is seamlessly integrated into their existing operations. The team works hard to understand startups’ unique needs and requirements to provide tailored solutions.
Offshoring can be an excellent option for health startups looking to reduce costs, access a wider talent pool and increase efficiency. By partnering with TurnKey, startups can find the perfect offshore team and benefit from skilled professionals without the burden of high labor and infrastructure costs.
Have an Idea for a Great Digital Healthcare Startup and Looking for a Perfect Team? TurnKey Has What You Need!
The investment size varies depending on the digital health VC firm and the startup stage. However, typically these firms invest anywhere from 00,000 to 00 million and more.
These top digital health VCs offer more than just financial support. They provide access to their network of experts and resources to help these startups improve their operations, development, and bottom line. They may also provide guidance on strategy and business planning.
Several notable healthcare startups have received investment and support from these top digital health VCs, including:
These are just a few examples of the many successful healthcare startups that have been able to thrive with the support of these top digital health VCs.
Looking to Hire an Offshore Software Development Team for Your Health Startup?
Contact TurnKey Today.
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