VC Obsession: Connected Health Start-ups
Connected health technology is hot, at least if you look at the kind of attention VCs are giving it.
According to Rock Health, a seed accelerator for digital health start-ups, funding for digital health grew 46% last year compared with 2011, whereas funding for biotech and medical devices was down.
Rock Health founder Halle Tecco describes the burgeoning space as involving software and sensors that employ new media but don't have to go through a long FDA approval process. In other words, not the kind of thing used in an operating room; we're talking fitness trackers, sleep monitors, and the like.
In fact, Tecco says she knows of at least 30 connected health start-ups--all of which pair sensors and software--that got funded last year.
The Up and Comers
Consider Misfit Wearables, for example. Its Misfit Shine device is a sleek, quarter-sized sensor that tracks activity including steps, cycling, and swimming strokes. It can be worn as a necklace or bracelet or clipped onto clothing. To sync it with a mobile app, you just lay it on the phone. Misfit Shine creator Sonny Vu recently raised nearly $850,000 on Indiegogo. He's the same guy who founded AgaMatrix, the start-up that created the first FDA-approved glucose monitoring technology for the iPhone and iPod touch, which is now used in more than 2.5 million blood glucose meters.
And here's one yours truly could put to good use: LUMOback is a sensor you wear around the waist that vibrates when you slouch and connects wirelessly to an app that tracks your posture and activities in real time. LUMOback closed a $5 million Series A funding round in December.
Connected health long-timer Fitbit closed $12 million in Series C funding last year and now has a cadre of wireless tracking devices in its portfolio, including its recently announced Fitbit Flex wristband that tracks steps taken, distance traveled, calories burned, quality of sleep, and includes a silent wake alarm. According to Fitbit, its users have collectively taken more than 80 billion steps, which is about the distance from the Earth to Mars.
I also spoke with Casey Pittock, VP of sales and marketing for BAM Labs, a company that recently received more than $4 million in Series A funding. The start-up makes a 1.5-inch by 2-inch sensor that sits in the corner of an air mattress placed under a hospital or skilled nursing bed and measures changes in air flow to capture trends in heartbeat, respiration, and motion for touch-free patient monitoring. It syncs with a small network-connected computer plugged into the wall, wirelessly sending data to the BAM Lab cloud platform, and communicates information regarding whether caregivers are turning patients as often as they should. According to Pittock, bedsores are a preventable $50 billion problem in the United States.
According to a recent survey by the Pew Research Center's Internet & American Life Project, nearly 70 percent of U.S. adults track a health metric for themselves or someone else. And while only 21 percent of those people use some kind of technology to do so, it's easy to imagine that if digital health start-ups can get the word out and keep the cost down, adoption will grow.
"The maker movement has really picked up momentum, and moved into healthcare where it's becoming cheaper and easier to build health products. Battery life is extending and the sensors are getting smaller," Tecco says. "It's a convergence of all these pieces that's making it more attractive for entrepreneurs."