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Almost exactly one year ago today, behemoth US healthtech conference HLTH, organised by the same people who put on fintech conference Money20/20, held a controversial launch party in Munich ahead of its 2024 event in Amsterdam that kicked off this week — its first on European soil.
The party took place on the first night of Bits & Pretzels’s healthtech conference, also in Munich, and drew several attendees (including this reporter) from that event’s speaker dinner for its own bash. The party was packed and when I arrived a baying mob of conference goers who weren’t wearing wristbands adorned with the HLTH logo were being turned away at the door.
It was a bold entrance to Europe — and it was a sign of things to come. This week its main event in the Dutch capital is similarly showy. Exited founders are playing 8am DJ sets in the “vinyl lounge”; there’s a gaming area with pinball and air hockey; and the Libertines headlined an aftershow party yesterday evening. One VC told me that “everyone is here”.
But one thing that’s struck me is the absence of founders who everyone is talking about on the speaker bill. While a lot of the chatter beforehand was about Babylon’s Ali Parsa being there, he pulled out before doors opened. I haven’t heard much about upcoming digital healthtech darlings who have raised or are about to raise a sector-defining funding round.
Don’t get me wrong, there have been plenty of promising startups on stage creating excited chatter off it. Virtual ward startup Doccla, alongside AI copilots for doctors Corti and Nabla are among the few that came up in conversations. The companies that everyone was talking about when they burst onto the scene a few years ago — the likes of Kry, Doctolib and Owkin — were also there.
But digital health startups hitting some serious, unicorn valuations for the first time now? They weren’t at HLTH Europe because, currently, they don’t exist in European digital health, VCs tell me.
The funding figures for the sector paint a telling picture. Digital health startups picked up $1.2bn across Europe in 2023, according to Dealroom — the lowest amount since 2018 and a long drop from the record $3bn in 2021.
Yes, funding across European tech fell across the board, but it fell further in digital health. Halfway through 2024 the numbers aren’t looking more positive. One seasoned founder, who’d just managed to close a round, told me that raising now was more difficult than during the 2008 financial crisis.
So where’s the money gone?
Talking to VCs on the conference floor, broadly speaking there are two schools of thought.
One is that generalist investors who piled into the sector during 2021 have taken flight, put off by long sales cycles and the absence of the kind of revenue growth they’re used to seeing in enterprise SaaS startups. The other is that specialist healthtech VCs are themselves struggling to raise new funds, and are slowing down deployment to make their cash go further.
VCs and founders tell me that they’re not panicking about the low patch, and they think investment will pick up in the next six months to a year.
And there are real areas of promise in the sector. Investors are genuinely excited about the potential of AI to automate processes in healthcare, the future of remote patient monitoring and the rise of preventative care.
Right now, though, it’s difficult to pick the winners.
But what do you think? Am I missing something here? What are the digital health companies that I should have on my radar? Which could be the sector’s next unicorn? Get in touch and let me know.
Read the orginal article: https://sifted.eu/articles/europe-digital-health-unicorn-hlth/
