TLDR:
- Healthcare venture funding declined in 2023, leaving many later-stage startups struggling to find investors.
- Galym Imanbayev, a partner at Lightspeed Venture Partners, believes that investing in growth-stage healthcare companies can lead to big returns.
- Imanbayev identifies four areas of healthcare where growth-stage deals are worth considering: value-based care, AI for clinical documentation, health data sharing, and pharma tech.
- He believes that companies in these areas have the potential for significant growth and can provide attractive investment opportunities.
Healthcare venture funding took a nosedive in 2023, leaving later-stage startups particularly vulnerable. As a result, some healthcare firms shifted their focus to seed and Series A deals. However, Galym Imanbayev, a partner at Lightspeed Venture Partners, believes that investing in growth-stage healthcare companies can lead to big returns. Imanbayev plans to take advantage of this opportunity and has identified four areas of healthcare where he believes growth-stage investments are worth considering.
The first area is value-based care, which is the transformation of healthcare providers. Imanbayev sees tremendous potential for returns in this market. The application of value-based care models to different parts of healthcare opens up plenty of investment opportunities. Previous exits by value-based care players also suggest that lucrative deals could be on the horizon.
The second area is AI for clinical documentation. Although applications of AI in healthcare face regulatory barriers and hype, automation of doctors’ notes or prior authorization forms can provide a high return on investment. Startups in this space are still maturing, and Imanbayev is tracking how growth-stage companies are applying AI to their businesses to identify promising investment opportunities.
The third area is health data sharing. Data interoperability and price transparency have been buzzwords in healthcare for years, and startups addressing these issues are now maturing. Imanbayev is waiting for these companies to reach certain benchmarks, such as patient engagement, before backing them.
The final area is pharma tech. Specialty drugs are a growing part of healthcare spend, and the industry is structurally unprepared for this trend. Imanbayev is interested in solutions that bring pharma companies closer to patients and improve patient treatments. Incentivizing clinicians to share real-world data with pharma companies is one potential approach.
In summary, Imanbayev believes that growth-stage investments in healthcare can yield significant returns. He advises healthcare investors to consider value-based care, AI for clinical documentation, health data sharing, and pharma tech as areas of opportunity.
