The Future of Healthtech 2025 (Silicon Valley Bank)

Summary

• So far this year, $5.5B has been invested in provider operations, putting it on track to surpass its 2021 record of $7.8B.p.3
• AI companies' share of healthtech deals has leaped nearly 60% since 2024, and AI-enabled provider operations swept up 73% of healthtech mega-deals this year.p.3
• Alternative care was 42% of healthtech investment dollars in 2021 and is down to 9%, while provider operations rose from 19% four years ago to 44%.p.5
• Averaged through August, healthtech projects out to $18.5B by the end of the year; total investment in Europe dropped 43% in the second quarter.p.8
• Mega-rounds are 38% of total investment into healthtech this year.p.10
• Of the $2.75B invested in ambient documentation-type AI since 2022, more than half has gone to just five companies.p.17
• Of the 10 most valuable private healthtech companies, eight haven't raised at a higher valuation in over three years.p.20

Key insights

1. The number of uninsured people in the US went up to 27 million in 2024, and federal changes could add 14 million more uninsured in the next decade.p.7
2. Hospital visits account for 31% of total US healthcare spending.p.7
3. Series C+ spending is projected to fall about 65% between the first quarter and the third, dropping more than $1.1B.p.8
4. Nearly half of all AI-enabled medical device recalls happened within the first year of clearance, double the rate for devices overall.p.9
5. About 46% of hospitals and health systems now use AI in their revenue cycle management operations.p.9
6. Provider operations now has 44% of all healthtech investment, and alternative care is down to 9%, barely passing $1B in 2025 so far.p.13
7. In ICD-10-CM testing, the top success rate of AI coding models was 72%, and no model had a successful exact match rate above 50%.p.18
8. Eighteen percent of companies that went public between 2020 and 2022 have been acquired or merged.p.20