Digital health startups pulled in $4 billion in venture funding in Q1 2026, the strongest first quarter since the pandemic-era peak. That’s up from $3 billion across 122 deals in Q1 2025 — and notably, 2026’s total came from fewer deals (110), meaning average round sizes grew sharply. Twelve megadeals did most of the heavy lifting, and California, as usual, captured an outsized share.
Who’s building in California right now
- Loula — a software platform and national provider network for independent birth and postpartum doulas, handling credentialing, contracting, and revenue-cycle management, starting in California.
- Kivo Health — AI-powered virtual care for seniors with chronic disease, beginning with lung disease, designed to help health plans cut costs by keeping members out of the hospital.
- Spruce — a HIPAA-grade communications platform for independent healthcare practices, combining a business phone system with texting, faxing, and telemedicine in one tool.
Where the capital is coming from
California’s healthcare investor bench remains the deepest in the country: Kleiner Perkins, New Enterprise Associates, Khosla Ventures, Bessemer Venture Partners, Delphi Ventures, Advanced Technology Ventures, Techstars, and Right Side Capital Management are all active across pre-seed through late-stage rounds. Y Combinator continues to be a major early-stage feeder, with a growing digital-health portfolio concentrated in the San Francisco Bay Area.
The shift toward fewer, larger deals suggests investors are consolidating around startups that have already proven a care model works, rather than spreading smaller bets across a wider field — a maturing signal for the sector rather than a slowdown.
How much funding did digital health startups raise in Q1 2026?
Digital health startups raised $4 billion in Q1 2026, the strongest first quarter since the pandemic-era peak, up from $3 billion across 122 deals in Q1 2025. Twelve megadeals accounted for much of the growth.
What are notable California healthcare startups in 2026?
Y Combinator-backed companies like Loula (a platform for independent birth and postpartum doulas), Kivo Health (AI virtual care for seniors with chronic disease), and Spruce (a communications platform for independent practices) are among the notable California digital health startups active in 2026.
Who are the top healthcare investors in California?
Leading investors include Kleiner Perkins, New Enterprise Associates, Khosla Ventures, Bessemer Venture Partners, Delphi Ventures, Advanced Technology Ventures, Techstars, and Right Side Capital Management, covering stages from pre-seed to late-stage.
