The first half of the year has been good to the healthcare space for those startup companies looking for funding, as the sector has seen a record influx of cash, according to a recent report from CB Insights.
During the first six months of 2019, healthcare companies globally raised $26.9 billion, compared to $26.5 billion during the same time period in 2018. AI-focused companies in the space also saw a new funding high during the second quarter of the year, as investors zero in on the technology’s emerging presence.
Healthcare AI companies raised $864 million during the second quarter of the year. A significant chunk of that sum came from $200 million raised by Tempus, a data-driven precision medicine company, in May. The second quarter saw 75 deals for AI. Though this is slightly less than 78 deals in the first quarter, the values were much higher in the second quarter. First quarter funding reached $579 million for the space.
Higher funding rounds are making the news, as well. A U.K.-based AI health services company, Babylon Health, raised $550 million in a series C funding round at the beginning of August.
During the quarter for AI in healthcare, BlackThorn raised $76 million, Frontier Medicine raised $67 million, PathAI raised $60 million and Finch Therapeutics raised $53 million.
In addition to sky-high funding rounds, more money is flowing into AI companies focused on medical image processing, including PathAI, which uses AI powered tools for pathology.
For the rest of the year, deal count for venture capital-backed healthcare deals and financing is likely to reach an all-time high in 2019, CB Insights predicted. Digital health has been the predominant subsector across healthcare VC deals, making up 32% of all healthcare deals. However, that’s down from 33% in 2018, 36% in 2017 and 37% in 2016.