In the second quarter of 2012, venture capital funding for the health IT sector totaled $293 million, according to a report by communications and consulting firm Mercom Capital Group, Government Health IT reports (Spies, Government Health IT, 7/24).
Venture Capital Deals, M&A Activity
Sixty-one investors participated in 28 deals, with venture capital firms Founders Fund and Venrock taking part in multiple transactions, the report found (McCann, Healthcare IT News, 7/23).
The report also identified 39 merger and acquisition deals worth $2.9 billion in Q2 2012 (Government Health IT, 7/24).
Raj Prabhu, managing partner at Mercom, in a statement said, "The strong uptrend that started in Q2 2011 has continued for four quarters in a row," adding, "Also significant is the continued strong M&A activity in the sector, providing investors and companies with viable exit strategies" (Pulley, NextGov, 7/25).
Venture Capital Funding Categories
The report examined venture capital funding for specific health IT sectors and found that:
- Health information management companies raised $247 million through 19 deals;
- Telehealth companies raised $19 million in three deals;
- Personal health record companies raised $16 million in four deals (Healthcare IT News, 7/23);
- Revenue cycle management companies raised $6 million in one deal; and
- Mobile health companies raised more than $5 million in one deal (Mercom Capital Group report, 7/23).