Press release
Healthtech Investments Stabilizing; Silicon Valley Bank Releases Future of Healthtech 2023 Report
Investment pace remains stable as valuations reset SAN FRANCISCO, Oct. 4, 2023 /PRNewswire/ -- Despite ongoing public market headwinds, the healthtech sector
About this update from First Citizens Bancshares, Inc.
[{"type":"text","content":"Investment pace remains stable as valuations reset \nSAN FRANCISCO, Oct. 4, 2023 /PRNewswire/ -- Despite ongoing public market headwinds, the healthtech sector is showing signs of resilience, according to the Future of Healthtech 2023 report from Silicon Valley Bank (SVB), a division of First Citizens Bank. In the first half of 2023, the sector saw the first positive public performance trends in over a year with stock trading up the first two quarters. M&A deal volume is also on the rise with activity expected to increase into 2024.\n\n \n \n \n \n \n \n\n \n\"While the current investment environment presents ongoing challenges, the healthtech sector is showing signs of stabilization with improvement in the public market and an increase in M&A volume,\" said Julie Ebert, SVB Managing Director for Healthtech. \"We've also seen promising investment trends in value-based care where an increase in strategic acquisitions is creating positive momentum.\"\nThe pressure on valuations continues to impact investment activity across the sector. While many companies likely had enough runway from 2021 to avoid raising capital in 2022, those that previously avoided down rounds by raising insider capital extensions must now consider valuation resets. \n\"Following a steep drop in 2022, venture fundraising has rebounded and there is significant dry powder for right-sized investment into the healthtech sector. We expect to see more stabilization as the investment environment resets valuations to match growth and profitability targets,\" said Ebert.\nSVB's Future of Healthtech 2023 report examines the latest investment, fundraising and deal activity across the sector and provides analysis for subsectors including value-based care, alternative care, provider operations, clinical trial enablement, wellness & education, healthcare navigation, medication management and insurance. SVB has released a healthtech report annually since 2018.\nFuture of Healthtech 2023: Key Data Points\n$8.2 billion in venture capital invested into private healthtech companiesHealthtech publics trading up 6% in Q1 and 25% in Q275 private venture-backed M&A deals in 202378% of healthtech deals have undisclosed valuations50% of healthtech mega-deals (deals that are greater than or equal to $100 million) were focused on value-based care$530 million of venture capital was inve...