Improving healthcare for all

The French e-health sector raised €577 million in 2021

Digital health startups in Europe raised almost three times more funds in 2021 than in 2020, according to a study by investment fund and e-health specialist Karista.

25 May 2022

For the second year in a row, venture capital firm Karista drew up a list of Europe’s leading e-health investors. 143 funds were listed, based on specific criteria. They all have their head office in Europe (France, Germany, Spain, Italy, the United Kingdom, the Netherlands, Austria, Luxembourg, and Belgium) and have invested in at least three European digital health firms. The majority are not specialized and focus primarily on early-stage ventures (57%). 

“This is the first funding map of its kind in Europe. It helps e-health firms to identify potential investors, and it also helps us to find co-investors,” explains Catherine Boule, Managing Partner of Karista.  

Karista listed 626 European e-health businesses, 63% of which are under five years old. A total of €4.2 billion was raised in Europe last year, including 577 million in France. The map shows that the average investment amount has grown, and now stands at €17 million.

“The map highlights the vitality of the digital health sector in Europe. It really took off in 2021, when it gained access to a much broader range of funding sources and a wide variety of investors besides biotech or digital health funds,” says Catherine Boule, Managing Partner of Karista. 

Including the first quarter of 2022, 143 European funds invested in digital health, up 61% compared to the previous year. This increase was largely due to France, where 17 new funds emerged. According to the Managing Partner of Karista,“the e-health market is young but very dynamic. Investors are showing a lot of interest in it, including those established in the digital sector and moving into e-health, and healthcare investors new to the digital realm.”

France ranks first in Europe for number of investment funds (32%) (United Kingdom 23%, Germany 20%), but still lags behind the United Kingdom for the number and size of investments made (€1.96 billion). “France doesn’t yet have enough mature firms to raise very large-scale funding rounds, but it will get there,” predicts Catherine Boule. 

This year, the study featured a new category, that of family offices (seven, including four in France). These private individuals – who are becoming increasingly numerous – invest their personal money in digital health, either directly or through a fund manager.  

Furthermore, around thirty digital health startups were taken over by large industrial firms in 2021. “This means that the startups have developed technologies and achieved a sufficient level of maturity to attract industrial firms,” explains Boule. That’s interesting to investors because it suggests that they may eventually sell their shares.” 

In addition, the country-by-country analysis reveals that Belgium and the Netherlands are taking up position in the sector (the number of e-health funds in the Netherlands tripled between 2021 and 2022). 

Karista is an independent French management firm established 20 years ago. It invests in early-stage firms operating in the health, digital health, and deeptech sectors in France and western Europe. It has a 50-million-euro fund dedicated exclusively to digital health, and a portfolio of eight firms.  

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