Bertelsmann venture arm is active across the globe. Carsten Coesfeld, CEO of Bertelsmann Investments and investment manager Tim Schneider share insights into their efforts in innovating healthcare. 

‍

The fact that a media company wants to invest in digital health and pharma tech is surprising at first glance - how did this come about?

Carsten Coesfeld: Bertelsmann Investments bundles Bertelsmann's global venture capital activities and the growth division Bertelsmann Next. The venture capital arm comprises the Bertelsmann Asia Investments, Bertelsmann India Investments and Bertelsmann Digital Media Investments funds as well as selected fund and direct investments in Europe, the US, Brazil and Africa, among others. The Bertelsmann Next division drives the entrepreneurial development of new growth industries and business areas, including digital health, pharma tech, HR tech and mobile ad tech. The fund network and Next activities of Bertelsmann Investments have so far invested around €1.9 billion in around 500 innovative companies and funds. Around €100 million of this has been invested in the digital health sector alone. 

Bertelsmann has several divisions that are already active in the healthcare market. Bertelsmann already generates around €1.5 billion of its approximately €20 billion in revenues in the healthcare market. Examples include Relias, an e-learning platform in the healthcare and social services sector in the US, and Afya, the leading provider of medical training in Brazil. We also process invoices for clinics and doctors with the financial services provider Riverty and successfully combine this with smart financial services. The logistics services subsidiary Arvato handles the logistics of various product categories in (bio)pharma, medical technology and diagnostics. And Arvato Systems is a digitalisation partner in the healthcare sector, which has established itself as a reliable partner in the healthcare sector as the operator of the telematics infrastructure (TI) in Germany. 

‍

What challenges do you currently see in the German and international healthcare systems? Where is innovation most needed? 

‍

Tim Schneider: The individual healthcare systems are very different and must be viewed in a differentiated way. However, what all Western systems have in common is considerable cost pressure, a major investment backlog and an enormous shortage of staff. Demographic trends also act as a negative amplifier.

Technology and process automation are the only way to stop this negative spiral and solve the problems in the long term. The future of the healthcare sector lies in networking, digitalisation and data-driven approaches. Start-ups and innovative companies play an important role in realising these key topics, which are playing an increasingly important role both in Germany and internationally.

Furthermore, patients are not only recipients of healthcare services, but also active shapers of the healthcare market. Their needs, decisions and preferences influence healthcare services and innovations. We believe that one of the greatest challenges at the moment is getting patients on board. Solutions must also be created for this, which we want to support. 

You recently invested in the start-up Doccla, which describes itself as a virtual hospital. Is the future of the hospital virtual? 

Schneider: Hospitals consist of complex processes that have to interlock in order to guarantee patient care. All these processes and action decisions are heavily dependent on information: Patient data, hospital data and medication information. The fact that we can now collect this data regardless of physical distance and transfer it to the hospital IT system makes it possible to outsource more and more processes and meet patients wherever they are. Remote patient monitoring is the first step in this direction and is proven to have a number of benefits for healthcare providers and patients around the world.

‍

Which technologies and innovations in the health sector do you particularly want to promote in the coming years? 

‍

Schneider: Patients are becoming increasingly autonomous and expect integrated medical care in step with technological progress. The healthcare industry needs to focus more on patients.  In other industries, however, this has long been a top priority and a key driver of profitability and growth - only there it is called ‘customer-centred services and products’. We want to support this change and at the same time advance society.

The situation is similar in the (bio)pharmaceutical industry - technological progress is making it possible for medicine to become increasingly personalised. But the infrastructure must also be in place for this. If you just look at how complex, lengthy and costly the processes surrounding clinical trials are, then I believe that we still have a lot of potential to improve people's health. 

‍

What makes health tech particularly attractive or particularly challenging for venture deals?

Coesfeld: The digital health market has enormous growth potential. The global market for digital health was worth around 241 billion US dollars in 2023 and is expected to continue growing at an annual rate of around 22 per cent from 2024 to 2030.  This naturally makes the market particularly attractive. Unfortunately, country-specific regulations and high data protection and security requirements do not make it easy for founders to assert themselves in the healthcare market. It is therefore very important for us to provide founders with the best possible support, not just financially, but in all other challenges they may face. True to our statement: 'We empower entrepreneurs all around the world'. Bertelsmann is the company of entrepreneurs and therefore we are the best partner for founders to help them build their businesses.

‍