Healthtech funding fell 55% in 2022; Sequoia, Accel top investors: Tracxn
While seed and late-stage funding declined massively in 2022 compared to 2021, early-stage funding in the healthtech sector saw a 26% rise year-on-year.
Total funding pumped into the healthtech sector fell 55% in 2022 compared to 2021, hurt by a massive decline in the number of late-stage deals. More than 70% of the total funds raised throughout 2022 were recorded in the first half of the year.
Late-stage investments, which are meant to support companies that have grown beyond the development phase, dropped 75% to $606 million in 2022, according to Tracxn's Healthtech India report.
Healthtech companies went through an investment slowdown after the pandemic-led hype started declining in Q4 2021 due to the funding winter, unfavourable macroeconomic conditions, and rising interest rates. Investors across the globe have become more cautious in spending their money in the uncertain market environment, according to the report.
The healthtech sector saw only two late-stage funding rounds of over $100 million in 2022 compared to 10 deals in the previous year. Digital healthcare platform raised $125 million in a Series C funding round from Quadria Capital, Lightrock India, and others. Consumer nutrition platform raised $135 million in a Series H round from Temasek, A91 Partners, and others.
However, 2022 was the second-highest funded year in the past decade, ranking only behind 2021, according to the report. "The pandemic has made people more aware of the importance of health, which has led to the increased usage of digital health services and driven the growth of this space," Tracxn said.
Moreover, early-stage investments rose 26% in 2022 compared to the year-ago period.
Sequoia Capital, Accel, and Chiratae Ventures emerged as the top investors in the healthtech segment in India to date, according to .
Online pharmacy Tata 1mg was the only Indian healthtech company to become a unicorn in 2022. The company raised $40.8 million in a round led by Tata Digital, with participation from KWE Beteiligungen AG, HBM Healthcare Investments and others, at a valuation of $1.3 billion.
There were 18 acquisitions in the sector in 2022, with the acquisition of Clinix by MediBuddy, and AQFIT by Deep Nordic among the major deals.
Edited by Kanishk Singh