LionBird, AmerisourceBergen launch new venture funds focused on health startups

Two health-focused venture funds made their debut this week, supported with millions of dollars to invest in healthcare startups. Earlier this week, pre-scale digital health investor LionBird announced an $85 million fund. 

Just a day before, healthcare company AmerisourceBergen unveiled a new $150 venture fund focused on emerging healthcare startups dubbed AB Health Ventures. 

Israel-based LionBird plans to use its new fund, LionBird III, to invest in 15 to 20 early-stage digital health companies. The company has previously invested in more than 30 digital health companies including TytoCare and Ovia Health. 

Meanwhile AB Health Ventures will be using its $150 million to invest in early- to mid-stage health startups. The venture fund plans to help its portfolio companies with prototyping, testing, piloting and commercializing their products. 

WHY IT MATTERS 

Over the last decade, digital health funding has continued to skyrocket. In 2021 Rock Health reported that the total funding for digital health startups in the U.S. was $29.1 billion. That number is up from $14.9 billion in 2020. 

The average deal size is also increasing over time. Rock Health reports that in 2021 the average deal size was $39.9 million, up from $30.8 million the previous year. 

While digital health funding has slowed a little bit in Q1, there remains much interest in the digital health space. 

“We believe technology will play a key role in shaping the future of healthcare – transforming how care is delivered, diagnosed and treated – and we’re continually encouraged in this belief as we see the waves of new and promising interdisciplinary talent entering the domain,” LionBird’s general partners said in a joint statement.

THE LARGER TREND 

AB Health Ventures and LionBird aren’t the only venture funds looking at early- and mid-stage companies. According to a CB Insights report, 45% of corporate venture capitalist digital health deals are funding early-stage companies, and 41% of deals are funding mid-stage companies.