In the dynamic realm of digital health startups, an impressive total of $5 billion was raised during the first quarter of this year. This remarkable figure signifies the highest quarterly investment in the digital health industry since the second quarter of 2022. According to a recent report by CB Insights, this surge in funding reflects a significant rebound compared to the .7 billion raised in the same quarter last year. This revitalization underscores the growing confidence of investors in the potential of digital health solutions to transform healthcare delivery globally.
Here are three key insights from the report that illuminate the recent funding resurgence in digital health.
The Rise in Size of Digital Health Funding Deals
Throughout the first quarter of 2025, the median size of funding deals in the digital health sector escalated to $6.4 million. This marks an increase from the $5.4 million median deal size recorded in 2024. This upward trend indicates a clear preference among digital health investors for later-stage startups that have achieved crucial regulatory milestones and possess scalable AI platforms. Such a shift reflects a growing maturity in the market, where investors are looking for established players capable of delivering innovative solutions at scale.
Notably, mega-rounds—investment rounds exceeding $100 million—accounted for nearly half of the total funding in the first quarter. In total, 11 mega-rounds contributed $2.5 billion to the overall funding landscape, signaling a robust interest in high-potential digital health ventures.
The Growing Dominance of AI in Digital Health
Artificial Intelligence continues to play a pivotal role in digital health startups, with companies focusing on AI technologies securing eight out of the eleven mega-deals during the first quarter. Notable funding rounds included Isomorphic Labs raising $600 million in March, Truveta obtaining $320 million in January, Innovaccer garnering $275 million in January, and Abridge raising $250 million in February.
Overall, AI-driven digital health startups attracted a staggering $3.6 billion in funding, representing a substantial 60% share of the total funding for the quarter. This trend illustrates the increasing reliance on AI technologies to enhance patient outcomes and improve operational efficiencies in healthcare.
The Emergence of New Unicorn Startups in Digital Health
During the first quarter of this year, six digital health startups achieved unicorn status, reaching valuations of b billion or more. This is already a noteworthy achievement, surpassing the three unicorns that emerged throughout the entirety of 2024. Among the new unicorns, four are based in the U.S., including Abridge, a clinical documentation startup, Hippocratic AI, an agentic AI firm, OpenEvidence, a provider of AI copilots, and Truveta, a data analytics company. The other two unicorns, Neko Health, a full-body scan developer, and Insilico Medicine, a drug discovery startup, hail from Sweden and China, respectively.
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