Moving away from public markets, IPO, SPAC and Palantir for a moment, would you like to talk more about startups? I would like to.
This morning I looked at venture capital financing models for wellness-focused startups. Broadly speaking, according to a new report, these startups raised less money in the first half of 2020 than in the first two quarters of 2019. The volume of deals dropped from nearly 600 in the first half of 2019 to just under 500 in the first half. 2020, and dollars invested went from $ 6.1 billion to $ 4.6 billion over the same time frame.
But, if we dig a little deeper and look at the sub-categories of wellness startups, the interesting hotspots become clear.
The Exchange explores startups, markets and money. You can read it every morning on Extra Crunch or receive The Exchange's newsletter every Saturday.Within the wellness startup subcategories that CB Insights dug out when compiling the dataset, some, like fitness tech and sleep tech, saw fewer deals and dollars than in the first half of 2019. But one particular variety is doing very well this year: companies focused on mental health.
The strong venture results these startups have seen in 2020 aren't entirely due to a pandemic, recession, and political turmoil that are causing more distress than usual, though I'd be surprised if those factors didn't provide some sort of favorable wind.
Taking a few quarters back, there's a little more on the commercial side of mental health startups that I want to unpack.
This morning, let's remember how startups like Calm and Headspace proved their market was large and profitable, let's look at the venture capital data and see if the pattern of strong space investment continues into the current quarter.
We should see another unicorn or two outside the pack, in our opinion, before the eventual tech downturn. So let's work to understand where the category is today.
