At our Digital Health Summit earlier this year, Malay Gandhi, Managing Director at Rock Health, noted that once digital health venture investing accounts for 10% of all venture investment, we should start breaking out investment by industry subsectors.

That made us think it might be interesting to look at our monthly download of digital health investments by sub-sector. We borrowed a simple taxonomy from Accenture that includes four sub-sectors:

  • Infrastructure
  • Diagnosing and Monitoring 
  • Engagement and 
  • Treatment


In the month of August, over half of the private investment in digital health went to infrastructure companies. There is still a lot of low-hanging fruit in this space as U.S. health care providers and payers look to increase efficiency in the wake of the ACA. Typically, investments in infrastructure companies are large, and August was no exception including two of the three largest deals of the month.

There were a total of 15 infrastructure investments in August with an average deal value of $41 million. While these investments are often later stage, in August the largest infrastructure round – also the largest round of the month – went to a Series A investment for $174 million in O2O (online-to-offline) a start-up founded by publicly traded Shanghai Pharmaceuticals.

AvidXchange, a provider of accounts payable and on-demand invoicing, also took in more than $100 million in August in a late stage round for $129.5 million. These two large deals accounted for more than a third of the investment that went into the sub- sector in the month.

Diagnosing and Monitoring

The diagnosing and monitoring sub-sector accounted for just under a quarter of digital health investment for the month. There were thirteen rounds for an average of $20 million each. There was one outlier in this group: Helix Opco, the developer of a consumer-facing genome platform, which received a $100 million early stage investment.

Nine of the deals were for $10 million or less, and the balance were in the $25-45 million range.


Developers or patient engagement tools and platforms received seven investments in the month of August accounting for 16% of digital health deals. All but one of those rounds, however, was for $10 million or less. Investment in this sub-sector was dominated by a $152 million Series D round that went to ZocDoc. Members can find healthcare providers and book appointments online or through a mobile app.


Six digital health companies focused on patient treatment received digital health investments in August, but investment in this subsector only accounted for two percent of the total. These were all seed or early stage rounds for less than $7 million.

These companies range from wellness platforms to interactive tools to treat diabetics. The subset of treatment-oriented companies is small and diverse at this point, but as biopharma continues to embrace the potential of digital health tools, we expect to see this subsector takeoff in the coming years.