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This year is shaping up as the first we鈥檝e seen in which biotech and healthcare startups receive a majority of U.S. Series A commitments.

So far in 2024, biotech and health companies have pulled in around $5.6 billion across 110 Series A rounds, per data. That accounts for 53% of all funding at the Series A stage, which is a closely watched barometer for the startup ecosystem.

The biotech sector鈥檚 comparatively strong showing comes as overall Series A dealmaking looks on track to come in a bit above last year鈥檚 totals. However, funding remains down from 2022 and much, much lower than in 2021, which was a record-breaking year for startup investment overall.

For perspective, we charted out Series A investment and deal counts for the past five calendar years below.

For healthcare and biotech specifically, meanwhile, the five-year Series A breakdown looks like this.

Not more rounds, but bigger ones

Notably, biotech and health companies aren鈥檛 gobbling up a larger share of rounds. They account for less than a third of this year鈥檚 Series A deals.

However, they are dominating in one subset of financings: the supergiant round.

Of the this year, six are biotechs. This includes the largest financing, which went to , a San Francisco-based startup using AI for drug discovery and development. The company secured more than $1 billion of committed capital in April from lead investors and .

The second-largest Series A also went to a biotech, , which is focused on precision medicine for chronic inflammation and fibrotic disease. The San Diego company landed $400 million in a March round, also led by Arch.

The preponderance of biotech megadeals isn鈥檛 limited to Series A rounds. A recent 附近上门 analysis of venture deals of $100 million or more this year found that 38 such financings went to biotech and healthcare companies, more than any other sector.

In the tranches

When companies announce large funding rounds, it doesn鈥檛 necessarily mean they鈥檙e getting all the money upfront. For biotech in particular, it鈥檚 not uncommon to see rounds paid out in tranches, which may be tied to predetermined milestones.

It鈥檚 also likely that heavily funded companies aren鈥檛 expecting many more large rounds before tapping the public markets.

For biotech especially, we see a lot of startups launching IPOs before they raise a Series B or C. To illustrate, we put together a that went public in the past couple years with Series A or B as their last venture round.

For tech, Series A stats look less encouraging

As biotech and healthcare companies scoop up a larger portion of Series A financing, there鈥檚 a smaller slice going to startups in other sectors.聽

Given that so much of what remains is going to hot startups in generative AI, there appears to be even less to go around for those in other spaces.

This is worrisome given that there is a vast supply of seed-funded companies that raised capital when investment was hitting record highs. Many of those are at the stage where raising a Series A round would be the next logical step for founders. Whether investors agree remains to be seen.

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Related reading

• Megadeals Explode Early In The Year As US Startups Gobble Up More $100M+ Rounds
• The Shrinking Series E: More Senior Startups Raise Smaller Follow-On Rounds

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