Health Tech has been experiencing a shift from B2B to B2C Business Models

Understanding the specifics of the MedTech ecosystem

The MedTech ecosystem is different from most other startup verticals in various dimensions. From previous newsletter editions, you might remember that:

- MedTech is the most patented technical field. 

- MedTech is more heavily funded by government-related investors than other sectors.

- Tech giants such as Apple and Google are disrupting the MedTech sector more eagerly than any other vertical these days.

The reasons for these unique characteristics of the MedTech startup ecosystem are manifold—for instance, a result of the sector’s oftentimes technologically-complex and regulated nature that, by default, leads to high patenting activity and more government involvement.

MedTech is different

Another unique shift in the medical technology startup field happens on the business-model front. Over the past few years, our analysis based on Rock Health Funding data reveals a growing trend toward direct-to-consumer business models offered by MedTech startups.

Again, this trend is contrary to overall startup dynamics. Across most other verticals, D2C models (think of classic consumer internet offerings, such as social media apps and e-commerce) have long dominated the market but are now cooling off, with B2B offerings gaining a stronger foothold.