(First published on MedCityNews)
(First published on MedCityNews)
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In a look at funding of digital health startups over the first six months of 2013, accelerator Rock Health made note of 38 crowdfunding campaigns in the sector that have closed so far this year on either Indiegogo, Kickstarter, Medstartr or Fundable.
That’s not surprising, since crowdfunding has been celebrated by some as a potential solution for startups facing a void as traditional investors migrate to later-stage deals. But the report shows that there’s a specific kind of product that’s well-suited to raise significant capital from the crowd.
Take a look at five of the most successful digital health crowdfunding campaigns so far this year:
- Scanadu’s medical scanner, Scout, $1.2 million on indiegogo
- Misfit Wearables’ activity tracker, Shine, $847K on indiegogo
- amiigo’s fitness bracelet, $581K on indiegogo
- Radiate’s smart workout shirt, $580K on Kickstarter
- Hapilabs’ smart fork, HAPIfork, $135K on Kickstarter
They’re all devices in some form that sync to a computer or mobile app, and four out of five of them are wearable. These five, plus one other product that the report didn’t name, apparently made up 75 percent of all of the crowdfunding dollars raised by the 38 companies in total. According to Rock Health’s count, 40 percent of campaigns that closed in the first half of 2013 failed to meet their goals.
niche crowdfunding platforms specifically for healthcare products, services and research have yet to compete with broader platforms. But a closer look at MedStartr shows that other kinds of digital health companies in need of less funding might have more luck there than on more mainstream platforms.
Campaigns that have met their funding goals on MedStartr tend to be philanthropic projects or digital products that seek less than $5,000. One notable exception is the Doctor Social Graph, a project that raised nearly $69,000 in two phases on MedStartr to gather and release an open data set that shows how doctors, hospitals and other health care providers work together to treat Medicare patients. Indiegogo and Kickstarter might be better places to raise more money for trendy consumer-facing devices, but I suspect MedStartr and other platforms that match products with investors, like Healthfundr and VentureHealth, will be more suitable options for niche products with less mass appeal.
[Image credit: Misfit Wearables]