Why Healthcare Investment Banking Is Important

Revenue from healthcare services reached a record-high in 2015 with a 6.6% increase to $369.7 billion. The US contributed 80% of that $369 billion, but Europe and Asia-Pacific generated 11% and 7% of total healthcare services, respectively.

Furthermore, the sector's total transactions grew by an incredible 28.4% to $81.3 billion.

With healthcare services growing at such a fast pace, it is no surprise that technology companies are looking to invest in the industry.

A number of companies in the healthcare sector have established early-stage venture capital funds to find early-stage start-ups that may help them provide more sophisticated products to their customers.

If we dig a little deeper into this issue, it will be easy to identify why this is happening.

Specifically, there are three elements to the larger healthcare ecosystem that we will focus on to help assist you in the decision making.


medications, tablets, medicine

A key component in any investment is having a strong product pipeline, with an impressive amount of products ready to go to market and serve unmet needs in the market.

While pipeline is a broad term, it is highly relevant to all sectors and industries. This is one of the reasons why investment banks continue to be so prevalent.

They help companies define their product roadmap, specifically focusing on their ability to execute against their business goals and how product innovation and disruption can provide the most innovative and competitive solutions to market, which generates growth and puts the company on the path to drive long-term success.


refugees, economic migrants, financial equalization

For example, there are several mega trends in healthcare that can change the landscape for healthcare as we know it. The good news is, these trends are also driving opportunity to drive growth.

While some companies may take a more "wait and see" approach to these challenges, this could actually hinder their ability to make a successful transition and will ultimately give rise to more consolidation and help position the company for long-term success.

As this trend unfolds, some of these companies will rise to the top and be key targets to help expand company's growth. However, other companies that "wait and see" will not be able to take advantage of the expansion and may even be at risk of losing market share as key competitors jump ahead.

This is where the investment banks come in to help companies to identify and determine how to be more competitive in the space to gain a competitive edge.

Financial fitness:

money, euro, profit

One of the key challenges that every healthcare company faces is the high cost of healthcare, primarily healthcare worker salaries. For the most part, this comes down to how a company pays its workers and their compensation package.

With healthcare becoming an increasingly competitive, lower-cost alternative to other sectors, it is imperative that companies that have this competitive advantage continue to invest in their workforce and maintain a competitive compensation package to continue to attract and retain the best talent.

However, with such a strong competitive advantage, this becomes increasingly challenging for companies to keep up with. An investment bank can help to identify and understand these challenges and help a company to navigate through this challenging environment by providing a compelling value proposition and business model, which can help unlock value for the company and its shareholders.

While it is critical for companies to clearly define their product roadmap, research the competition, identify gaps and opportunities, as well as consider the costs associated with their compensation packages, there are other very powerful factors in the health of the company that should be considered as well.

Not all companies are equally qualified or have the same resources:

chess, metaphor, board

Whether or not you're ready for some corporate finance, you are already swimming in a sea of competitors. As with any sector, you're likely not alone in your pursuit for growth. While competitive pressures may be many, all companies and sectors have their strengths and weakness.

To help identify these weaknesses, it's important to understand what other companies in the industry are doing. Who are the companies that are generating growth and how are they doing it?

The differentiating factors of growth-focused companies are critical to the health of a business and is a key element of corporate finance.

Partner with an Investment Bank that is uniquely qualified to provide insights you need to compete and grow. You will build on the strategic initiatives that have been set in motion and position the company for success.


One of the most critical factors for long-term success in any industry is understanding the competitive landscape and being ready for what comes next.

This is particularly true for today's healthcare industry. The landscape is evolving at a rapid pace and new competitors are emerging with seemingly infinite resources.

Whether you're a start-up looking to go public or an established company looking for growth capital, it is important that you look beyond what you already do well. Leverage the expertise of a specialized, integrated team of investment bankers that is best able to identify the right opportunities for you.



SQ Recommends

Copyright © 2024
Success Quarterly Ltd. company