#Twenty25 - Funding the future of health tech - Part 7/20 Interview with Dominick Kennerson, HSBC Innovation Banking

Ian Coyne: In 2025, from your perspective, where do you think the most interesting health tech investments will be?

Dominick Kennerson: I think 2025 will be the year for women and children. Flo Health becoming a unicorn is quite significant. I think that helps the valuation story with the entire women's health sector and I see that wave continuing into 2025.

I do believe children will also come into focus, especially around developing personalized healthcare experiences, particularly in mental health. The best UK example we have is in Kooth, and their work in the United States for personalized mental health to young people is remarkable.

There are also companies, such as Little Journey, which supports research for children, young people, and their families. I’ve also noticed research news about potentially applying the GLP model to adolescents, which I am sure divides opinions, but it shows that people are thinking more about children's health, especially in high-income and middle-income countries where one can potentially address healthcare challenges much earlier in life. It's absolutely the year for women and children.

The technology layer that will continue into 2025 is around AI, and I don't think that's going to stop in 2025; it is proving to be another technological revolution only dampened by potential policy frameworks.

There's also a value pool around consumer models. For example, Ada Health received an award in the US for their consumer approach to healthcare.

At a more granular level, inside organizations, this year we've seen increased attention around health tech models to support physician practices. There was a recent white paper, “State of AI” from Innovacer, showcasing physician views towards workflow automation driven by AI and how AI can help. This kind of approach has been well documented in the NHS, and with provider attitudes and perspectives in the NHS supporting unobtrusive automation opportunities, I think this trend continues into 2025.

Ian Coyne: Thank you, Dominick, let’s look ahead and more broadly, what are the areas you are particularly interested in or excited about across health tech?

Dominick Kennerson: The one area I'm hugely curious about in 2025 is the role of quantum in healthcare. Here in the UK, we have significant quantum capacity. In the larger geopolitical context, quantum represents a huge risk, challenge, and opportunity. I'm curious to see where people thinking about quantum applications in healthcare go and how they develop that.

Primary care is also going to be important. Recently, a lot of people have been talking about a new company in the UK, Neko Health, who are delivering preventative health screening. When we were at our last event together, several people mentioned this company, and people are imagining how primary care models like this can deliver care to people that seamlessly enables people and tech.

I'm also curious about M&A activity in 2025. We haven't seen as much M&A in 2024 as expected, but I think it will increase in 2025. The mantra for the last 18-months has been moving to profitability, but how does this mantra translate to growth investor sentiment? If a profitable company has about 20% growth year over year, is that a story that venture investors are willing to support? This balance between VC investment for faster growth and profitability will continue in 2025.

The Bessemer Ventures report, “State of Health Tech 2024” mentions the time it takes to go from seed to Series A and Series A to Series B. It used to be about 18-months, but now it's at least 24-months and growing. This fundamental shift changes risk appetite and how investors fund companies.

I also think there will be an IPO story in 2025. Reports on S1 filings for companies in the US looking to go public in 2025 are exciting. This will lead to more publicly available audited financials on health tech companies – which can help the entire ecosystem with more consistent valuations.

Ian Coyne: Final question, if you had a magic wand and could change one thing to accelerate growth and innovation in health tech, what would that be?

Dominick Kennerson: Maybe the IPO story in particular, and investor exits in general, would be the magic wand. It can't be overstated enough that health tech companies have been filing to IPO in 2025. Having transparent value points in the marketplace is a rising tide lifts all boats scenario.

Outside of IPO, private exits (M&A) and dealflow come into scope if investors are unwilling to keep up the “cashflow-breakeven” mantra of the last 18-months. Some companies have been quietly failing, while others are still hopeful, then there are those companies that are still fundraising and growing at a relative rapid pace. If investors cannot continue silently bridging companies in 2025, then we need to create forums for learning lessons: failures and pitfalls.

Thinking about personal experience, having been part of a $300 million startup that didn't IPO but did exit, I think we need to unpack more learnings for health tech to take its next evolution. We can only learn through best practice and what good looks like from an investor's perspective, whether that investor be healthcare specialist or generalist.

Ian Coyne: Dominick – it’s is always a pleasure – thank you for being part of the 2025 Outlook.

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Dominick Kennerson, Senior Vice President Health Tech at HSBC Innovation Banking

Dominick Kennerson is Senior Vice President for Health Tech at HSBC Innovation Banking, based in London. In his work with HSBC Innovation Banking, Dominick works with the health tech (digital health) sector’s leading CEOs and CFOs to solution success via industry insights, networks, and the bank’s global value proposition.

Dominick joined HSBC Innovation Banking in 2023 after a near-decade career with Bayer AG, based in Berlin. During his 9-year career with Bayer, he held distinct roles: in global communications, global public affairs, and served as the Global Director of G4A, respectively. He is known as a healthcare expert, with deep experience and insight across several sectors, including public health, health innovation and entrepreneurship, healthcare communications, and healthcare policy.

Dominick’s healthcare and digital health experience is deep, with a public health start with the United States Department of Agriculture (2002); in 2006, he was part of the pioneering digital health platform Revolution Health; and as a consultant he’s worked with leading biopharma companies such as Pfizer, Sanofi, and Astra Zeneca.

In 2010, Dominick became a Robert Bosch Foundation fellow (Berlin, Germany); where he was exposed to the mechanisms of the transatlantic alliance and held transformative work experiences with Germany’s National Statutory Health Insurance Association (GKV-SV), and Bayer Healthcare, respectively.

He holds a bachelor’s degree in biology from South Carolina State University (2002), a master’s degree in healthcare management from The George Washington University (2005), and a certificate from the London School of Economics Executive Education program for Entrepreneurship & Innovation (2022).

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