Investments into the online healthcare sector soared in 2020, supercharged by COVID-19. According to the research data analyzed and published by Finaria, the total digital health funding in 2020 amounted to $21.6 billion. VC funding led with a total of $14.8 billion across 637 deals, a 66% year-over-year (YoY) uptick.

Based on a Silicon Valley Bank (SVB) report, investments in the healthcare sector as a whole amounted to $51 billion during the year. Biopharma led in deal value, with investments worth $24.5 billion across 570 deals.

$18.5 Billion Teladoc-Livongo Deal Topped Digital Health M&A

The total VC funding in the digital health sector set a new record. It also drove its total investment value since 2010 to $59 billion across more than 5,000 deals.

Around 77% of all funding in 2020 went to US companies, $11.5 billion across 429 deals. Comparatively, China received $1.1 billion in eight deals. Consumer-centric companies received $9.6 billion (+81% YoY) while practice-centric ones got $5.3 billion (+47% YoY).

Telemedicine was the highest ranked category, receiving $4.3 billion, up by 139% YoY. It was almost equivalent to the next three categories combined. Data Analytics raised $1.8 billion, mHealth Apps got $1.4 billion and Clinical Decision Support gained $1.2 billion.

Additionally, the digital health mergers and acquisitions (M&A) sector increased by 9%, from 169 deals in 2019 to 184 in 2020. The Teladoc-Livongo deal, valued at $18.5 billion was the highest.

For the healthcare sector as a whole, Q3 2020 was the best quarter in history as funding reached $15 billion.

Similarly, 2020 was a record year for IPOs, with six companies raising a cumulative $6.2 billion. Mercom Capital analysts project a higher number of IPOs in 2021 based on the 2020 IPO and SPAC boom. SVB echoes the sentiment, forecasting between 15 and 18 IPOs by mid-2022.