The trend seen with these digital healthcare start ups
Going by the findings these digital health start ups had seen tremendous growth in year 2014 they have generated revenues more than $4 billion but their stock value was not as good as their revenues generated. It might be too soon to judge the benefits of the digital health start ups or it is just an idea of the challenges that will be coming up in this industry in coming years. 20 public digital health firms were not able to remain in S&P 500 in the market and five companies which were went public were not able to keep up their share values in the market.
These trends were seen by Rock Health which plays a key role in seed funding for these digital start ups. As per their report, it might be too soon to judge the these digital start ups becoming public since few of them failed last year after becoming public. Venture capitalists are keeping a close eye on these businesses and how they grow in future. As per their report, it is a major concern if some the start ups are not able to turn public which are being funded from past seven to eight years, there is a growing possibility of those start ups need to be shutdown. Despite some of these issues, the bet on digital health start ups is high, since last year the revenue generation was about $4 billion dollars by 260 companies, which is the combined revenue of years 2011, 2012 and 2013.
Change brought by the new law
To make healthcare system easy and effective for people, a new act Affordable Care Act was passed which allowed financial incentives for improving healthcare systems. With the technological growth in mobile phone industry, it has become quite feasible to implement the digital system of healthcare.
As per RockHealth, the analysis done is of a shorter time period, one must need to wait and watch where the industry is heading ahead. Since 19 companies were not able to create profits when the market was high cannot be the basis to Newsrooms predict about the whole industry which is still in a nascent stage.
Market and consumer
The fluctuations seen in the digital health start ups could be an effect of fluctuating market which now is more stable than previous year. Also, it will take some time for people to get use to the benefits of digital healthcare system since still people are not sure about the effectiveness of it. Once the positive results starts flowing the acceptability among the public will increase for them.
The industry has been predicted to be worth $100 million dollar in nest decade, but it is yet to understand when will the benefits of digital healthcare system will pick up its pace.