As part of its kick-off, the EU-funded project eHealth Hub surveyed over 300 European digital health SMEs. I expected some of the results but got a few surprises too I thought I would share.
82% of EU startups stated revenues under 100K€, including 39% of them still being pre-revenues:
So I guess they are right when they say digital health is still young in Europe. I hate hearing it because reviewing Health 2.0 Europe demo applications year after year, it is clear that the maturity of the solutions is definitely up. I can only conclude that the supply side is maturing faster that the demand side – whether we are talking of consumer or professional facing solutions. And this is where eHealth Hub will probably make its biggest contribution: working with demand-side stakeholders to connect and activate the market.
I was also surprised to see that most SMEs are working on B2B or B2B2C solutions:
Surprised because we always benchmark our investment flow to the US’, but the lion’s share of the deals is still going to B2C solutions over there. We tend to blame it on investors, but maybe our investment flow would be a lot greater if only that ‘C’ was stronger and Europeans were ready to open their wallets and become health consumers? As digital health solutions are proposing new definitions for health care choices, service, and convenience, we are already starting to see a shift in European health consumer attitudes.
83% of SMEs surveyed stated they were currently looking for funding. While investors most important criteria remain revenues and commercial traction, the 2 percentages put together nearly got me depressed. But 37% of the same startups also stated they had already raised a round of external capital, 38% of that subset having raised over 1M€. So raising money without revenues is possible!
With the right idea, the right plan to turn it into a business, the only remaining challenge for SMEs is to identify and connect with the right investors! And it’s never too early to do that. It’s their job to be on the look-out and ahead of the wave. But sometimes, it’s just too early to ask for money… Startups should always remember the saying: “ask for money and you’ll get advice, ask for advice and you’ll get money“.
Investors will travel to events to keep up with trends and discover promising startups but the truth is most of them build their pipelines through other investors. Yep, they talk. And yep, some are leading and some are following. So how do you find the right investors? This is exactly what the eHealth Hub investment platform intends to facilitate by mapping criteria of the most active investors in digital health.
eHealth Hub will also continue to organize events like EC2VC to facilitate the conversation with investors and demand-side stakeholders. So stay tuned through our newsletter or via @EU_eHealth_Hub!
PASCAL LARDIER | Principal Édito
Through [édito]Health and Health 2.0, Pascal’s mission is to promote health innovation ecosystems around the world and connect key stakeholders including startups, payers, providers, pharma and medtech groups, and VCs.