Is a pandemic good for your health...tech?
🩺 A surge in funding in Q1 & Q2 2020, but a negligible impact overall
Though since Q3-20 the share of funding raised by healthtech start-ups has gone back to pre-pandemic levels (around 2%), the first half of 2020 deserves some attention. Indeed, while VC activity on the continent slumped, to take stock of the ‘unprecedented times’, healthtech start-ups did really well. Of the 5 largest healthtech deals since early 2019, all but one (mPharma) were announced between February and May 2020: Vezeeta (largest deal at $40m), 54gene, mPharma and Helium Health. In April 2020 specifically, the two healthtech deals (54gene & Helium Health) made up 78% (!) of all funding raised through disclosed USD1m+ deals in Africa. But this bonanza was short-lived. Indeed, despite the frenzy of early pandemic months, when we compare the first year of the pandemic (Q2-20 to Q1-21) to the year prior (Q2-19 to Q1-20), healthtech ventures haven’t actually performed any better than the rest of the ecosystem in terms of fundraising, and their share of total funding remained stable: 4.1% in year 1 of the pandemic, versus 4.2% the year prior. Will the pandemic have encouraged more investors to consider healthtech as a promising sector? Could this translate into more or larger deals further down the line? For now, it’s pretty hard to tell…