Digital health companies bringing a new product to market go through a series of financing stages. These stages refer to the capital necessary to cover a range of business costs — such as office space, product development, manufacturing, and marketing. This glossary briefly describes common funding stages.
- Angel Investors: The first source of funding for start-ups, usually friends and family.
- Seed Funding: The first round of funding a company goes through, funding can range from $10,000 to $2 million, although this can vary widely on a case-by-case basis.
- Series A and B: After seed funding, companies try to raise $1 million to $40 million dollars, depending on the company, as they develop their business model, recruit talent, and expand.
- Series C and D: As companies becomes more developed, they approach Series C funding, where they try to raise capital around $20 million to $80 million and beyond.
- No Longer Seeking Investors: Some companies reach a point where they are no longer seeking funding from venture capitalists. These companies are able to operate on revenue generated from their product.