After record investment and aggressive valuations from 2020 to mid-2022, public market struggles led venture firms to prioritize portfolio triage throughout 2023. By 2024, new deal activity resumed, but with a clear shift and investor focus. The challenges of securing follow-on financing, particularly Series B rounds, has dampened early-stage activity, resulting in fewer Seed and Series A deals. Investors have instead leaned towards larger syndications raising large early-stage rounds (including $100M+ mega rounds) or have shifted their focus to later-stage, de-risked opportunities. Meanwhile, many companies that raised add-on or inside rounds are now “on the clock”, facing pressure to secure new investor-led financing or risk consolidation or shutdown.

Healthtech

Early-stage healthtech investment was down but momentum in clinical AI applications remained strong. Overall investment rebounded from 2023 and approached pre-banking crisis levels, though Q4 activity declined as investors waited for clarity on the 2025 IPO landscape. Investment in companies focused on underserved populations (women’s health, mental health, senior care) persisted. The IPO market stayed quiet, with several high-growth companies delaying public debuts or filing confidentially.

Med Device

First-financing activity declined due to concerns about securing Series B leads and extended private M&A exit timelines. Series B rounds often achieved up valuations, while Series A saw more insider extensions. The largest deals (top 10%) accounted for 60% of investment, with neuro, NIM, and orthopedics leading. Cardiovascular was the most active segment for private M&A, while deal values dropped from 2023 but remained above pre-pandemic levels.

Biopharma

Venture investment in biopharma surged in 2024, with first-financing dollars more than doubling compared to 2023—driven by a high number of $100M+ mega rounds, which made up a majority of all first-financing capital. Oncology and platform companies were investment standouts, with autoimmune, metabolic, and dermatology also seeing major financings. M&A activity picked up, with more deals over $1B, while IPOs focused on companies with Phase I/II assets; however, post-IPO performance was mixed, with median declines of 33%.

Dx/Tools

First-financing fell to a four-year low as exit conditions and follow-on financing risks increased. Corporate investors, rather than VCs, led activity in radio pharma, computational biology, and oncology liquid biopsy. Investment overall concentrated heavily in a small number of large, commercial-stage deals (top 10% took 48% of all dollars), with most capital going to revenue-producing companies.