Business COVID-19 Health, Wellness & Biotech Startups Venture

CES: Consumerization Will Be The Future of Digital Health

The Consumer Electronics Show 2021 wrapped up on Jan. 14, but not before a very interesting session on what’s happening in digital health, particularly around new trends, COVID-19, companies going public and investments.

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The well-known consumer electronics show, which was virtual this year, features company showcases, keynote speakers from top global consumer companies, and a plethora of webinars on topics including the latest products to make your home smarter and what’s happening in the fintech, e-commerce and digital health industries.

Lisa Suennen, lead of the digital and technology group at Manatt, Phelps & Phillips, led a panel of venture capitalists speaking at the pre-taped “Digital Health: Business Growth and Opportunities” session that included:

Wainwright Fishburn, global head of digital health at Cooley, kicked off the session with a look at the digital health landscape. He reported that investment in the space reached $14 billion-plus in 2020, with record-breaking capital being invested in some key areas of telehealth, mental/behavior and fitness/wellness.

With physicians more comfortable in using telehealth, M&A and IPO activity expected to continue, and venture capital not letting up, Fishburn said that “digital health is finally mainstream.”

Clockwise from left, Lisa Suennen, Bill Evans, Sydney Thomas, and Lynne O’Keefe

On new trends

O’Keefe: “The consumerization of health and the need for a better experience. Post-COVID has emphasized that in simplifying the experience and making it consumer-first.”

Thomas: “Yes, consumerization right now is an interesting space. The risk of going into the hospital is high today, and people are afraid. As a result, I see a lot of direct-to-consumer and at-home products. Another piece is the affordability of health care, and I am starting to see a model of breaking down components so that individual products are affordable.”

Evans: “We put an emphasis on the ‘plumbing’ of health care, the B2B models that have a huge potential to introduce efficiency and effectiveness, and not at the expense of experience.”

COVID as a sustainable business opportunity

Thomas: “COVID created some really long-lasting changes in everything. I actually don’t mind. A number of companies I did last year were being supported by the tailwinds of COVID. I am going to continue to invest in those companies. I’m not going back to the office at least for another nine months and even then, I want everyone to have the yellow dot that shows you got the vaccine. There are a lot of folks who have survived this moment and have life-changing impact.”

On investment surprises

Evans: “What surprised me was the pace at which the capital markets and rallying of public markets returned to normal at the beginning of the pandemic. Also, the pace at which investors came back, and the degree to which the venture industry and entrepreneurs knew how to deal with a crisis.”

Thomas: “I was also surprised by how much more VCs were interested in health care. People were reaching out to people they had not before. I’ve been able to get more access to different people, and that the decision to invest in health care is more important.”

O’Keefe: “It’s not like everything got hard in COVID. Those problems that were siloed in nature existed before. Entrepreneurs have come in and are thinking outside the health care system, breaking down the walls and creating better customer experiences.”

Similarly to the prediction about the consumerization of health care, sources I spoke to earlier in the month shared the same forecast as startups help us rethink health care.

Crunchbase data also showed that investors poured record amounts of investment into digital health startups in 2020: $14.2 billion globally and $9.2 billion domestically.

Meanwhile, the global pandemic increased the public’s awareness and understanding of how interconnected the world is, a view that will mature in 2021, Ann DeWitt, a general partner at The Engine, which invests in health care companies, told me.

For another CES highlight, catch my synopsis of the Jan. 12 session called “The Rise of FinTechs – Has Consumer Financial Behavior Changed Forever?” which included conversations with Ginger Baker, head of financial access at Plaid, and Erika Wool, head of payments partnership at Stripe.

Feature screenshot was taken during the session
Illustration: Dom Guzman

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