Health Care’s Inflection Point

The Gotham Gal looked up from her laptop yesterday and said to me “I’m seeing a ton of health care deals right now.” I looked up from my Kindle app and nodded.

Mary Meeker’s slide deck addressed this is bit. Here are a few of the big points from it:

Healthcare is now $2.8 trillion in the US, which represents 17% of GDP

Healthcare is being consumerized

Healthcare is being digitized

Digital Health Venture Investment was $1.9bn in 2013 (out of a total of $24bn)

I listed health care as one of four “sectors” in my LeWeb talk last fall and when asked recently what excites me most, I mentioned the “mobilization of health care”.

The Gotham Gal has been making a bunch of these kinds of angel investments this year. She’s closed two and has a third in her pipeline. That’s somewhere between 25% and 33% of her investment activity right now. As Mary’s data shows, digital health is approaching 10% of all VC activity.

At USV, we’ve been looking hard at this sector but have only made one investment so far, in HumanDX. Albert explained the investment thesis behind HumanDX here.

We’ve made a few other offers but got outbid pretty badly on them. There is a lot of heat around this sector right now.

We are looking for networks of users, patients, doctors, and other stakeholders in our health care who can transform the way health care is delivered. We only have one game plan at USV and look to play it in every market opportunity we see.

I am pretty certain the intersection of the Internet and mobile, the digitization of the health care system, and a desire for people to take more control over their health is going to be one of the biggest investment opportunities we will see in my lifetime. And its game on.