Digital Health’s Funding Rebound: Getting Ahead With PR

Cue up Comeback Kid…after years of slowed investment and market volatility, digital health funding is on the rebound. In the first half of 2024, digital health startups raised $5.7 billion – putting the sector on pace to exceed the total raised in 2019 and 2023. And most of this H1 funding surge came from early-stage deals, with Seed, Series A and Series B rounds accounting for 84% of the labeled raises.

More capital on the table – and at earlier stages – means digital health startups can’t afford to sleep on PR. Here are three ways a proactive PR strategy can help you attract investor attention, cut through the crowded healthcare AI landscape and make the most of a funding round.

Proactively Build Brand Awareness To Attract Investor Attention

You're missing an opportunity if you wait until a funding announcement to invest in PR. Every founder has an exit strategy in mind, and a thoughtfully planned PR strategy lays the groundwork for a successful exit.

Private equity (PE) firms are more active than ever in the digital health sector. PE firms acquired 10 digital health startups in the first half of 2024, more than the total number of digital health acquisitions they made in 2023. As PE firms grow their digital health portfolios, they’re looking for startups with strong CEOs and demonstrated growth and innovation – and PR builds the case.

Focus on building consistency in company news and amplifying it by securing coverage in healthcare technology trade publications. Consider issuing a momentum press release at regular intervals (e.g., quarterly or annually) to highlight growth metrics, industry partnerships, external recognition and product innovation. And celebrate major customer wins with a press release to show potential investors you’ve created and retained a valuable customer base. Chances are, your competitors are regularly sharing company news, so if you’re not, you risk ceding share of voice and seeming like a digital health laggard.  

Cut Through the Healthcare AI Noise

One in three dollars invested in the first half of the year (34% of total sector funding) went to digital health startups leveraging AI. While AI presents a massive opportunity to drive operational efficiency and cut healthcare costs, healthcare AI requires a higher bar than  other industries. If Spotify’s AI algorithms are only 75% accurate in predicting song recommendations, a rogue country song may kill the vibe, but no one gets hurt. In healthcare, human lives are at stake, so there’s no margin for error with AI.

AI has become a buzzword in the digital health space, and investors are now more discerning. To cut through the AI noise, you need a unique point of view and proof points to back it up.  

Thought leadership presents an opportunity to differentiate your approach to AI by highlighting how you’ve achieved the highest level of accuracy, ensured traceability and prioritized ethics. Position executives for contributed articles and interviews on topics such as “How To Prevent Bias in Healthcare AI Algorithms” to demonstrate your rigorous development processes and industry leadership. Earned media placements and analyst recognition can provide third-party credibility for your AI capabilities.

When It’s Time for the Funding Announcement, Seize the Moment

Let’s be honest: it’s hard to get mainstream media to care about topics as niche and technical as “risk adjustment” or “interoperability.” A funding announcement is a rare opportunity to get top-tier coverage for your digital health startup – and you don’t want to miss the moment.

Many B2B healthcare companies rely on account-based marketing, so getting your messaging in front of the right person could lead to closing a multimillion-dollar contract with a payer or provider group. Coverage in top-tier healthcare publications like STAT, Fierce Healthcare and Becker’s is important for building credibility and consideration among healthcare decision-makers. These publications often have policies against covering “promotional” company news such as product announcements, so a funding announcement is the perfect loophole to get company-focused coverage.

While it may be tempting just to have your internal team handle outreach on the day of a funding announcement, maximizing coverage requires planning weeks in advance. Bringing in a tech-focused PR agency offers the unique advantage of experience. Across our client base, our agency team has exposure to several funding announcements every year – meaning we already have established relationships with funding reporters and know the timing and hooks that work to attract media attention.

Moral of the story: digital health is heating up (if you’ll indulge my pun, you might even say it’s on FHIR). Don’t squander this opportunity to get in front of prospective investors and customers – now is the time to plan a comprehensive PR strategy.