Digital health faces the same hurdle as fintech: Get profitable or get lost.
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Dan DeFrancesco
May 10, 2023, 21:40 IST
Getty Images/Christopher Furlong
Hey there!Dan DeFrancesco in NYC, but more specifically I'll be at the Fintech Nexus conference today with my colleague Paige Hagy. Come say hi if you see me. Just mention the newsletter so I know you're one of the good ones.
Digital health, once the darling of the healthcare industry, is having a tough go of it. After a pandemic-fueled surge when health services and offerings utilizing tech were prioritized, digital health has come back down to earth.
But the market downturn isn't terminal... at least not for the entire industry.
It's obviously in a dealmakers' best interest to call for a return of M&A, but the bankers Insider spoke with provided some thoughtful, nuanced perspective on where the industry will, and won't, see activity.
The similarities between digital health and fintech are striking. Startups in both spaces leverage tech to upend incumbents, streamline services, and improve the overall customer experience. They're also doing it where the stakes are high: health and money.
Of course, it's not just out of the goodness of their hearts. The "tech" part of their strategy, they argue, affords them a higher valuation than would traditionally be considered for companies in their respective spaces.
For both fintechs and digital health, this year has served as a reminder that they're only partly tech companies. They still exist in industries that largely rely on fundamentals. And ideas, however grand and ambitious, need to eventually be tied to dollars and cents.
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