What type of Healthcare Cybersecurity companies are being funded and acquired in 2025?

Lloyd Price

3 minutes ago

Exec Summary

The healthcare cybersecurity landscape is evolving rapidly, driven by increasing cyber threats, regulatory pressures, and the integration of advanced technologies. Trends from late 2024 and early 2025, combined with industry insights, provide a clear picture of the types of healthcare cybersecurity companies attracting investment and acquisition interest this year.

Types of Healthcare Cybersecurity Companies Being Funded and Acquired in 2025

AI-Driven Cybersecurity Solutions

Companies leveraging artificial intelligence (AI) and machine learning (ML) to enhance threat detection, response, and predictive analytics are highly sought after. These solutions address sophisticated cyberattacks, such as AI-powered phishing and autonomous malware, by offering real-time monitoring and adaptive defences.

In 2024, companies like Proofpoint acquired Normalyze (a leader in data security posture management with AI capabilities) and Cisco acquired Robust Intelligence (focused on AI security). This trend is accelerating into 2025 as healthcare organisations prioritise AI to counter evolving threats.

The ability of AI to analyse vast datasets and identify unusual patterns makes it critical for protecting sensitive patient data, especially as cyberattacks grow more complex.

Cloud Security and IoT Protection Providers

With the healthcare sector increasingly adopting cloud-based solutions and Internet of Medical Things (IoMT) devices (e.g., connected medical equipment), companies specialising in securing these environments are in demand. This includes endpoint protection, encryption, and cloud security posture management.

Early 2025 projections suggest continued interest in firms like ClearDATA (cloud security for healthcare) and Cylera (IoMT security), building on 2024’s focus on scalable, cloud-compatible solutions.

The shift to cloud infrastructure and the proliferation of IoMT devices create new vulnerabilities, driving demand for specialised protection that ensures compliance with regulations like HIPAA.

Managed Security Service Providers (MSSPs)

MSSPs offering outsourced cybersecurity services, such as 24/7 monitoring, incident response, and compliance management, are gaining traction. These providers cater to healthcare organizations lacking in-house expertise or resources.

Lumifi’s 2024 acquisitions to expand healthcare cybersecurity services and Accenture’s acquisition of Innotec Security (cybersecurity-as-a-service) signal a strong 2025 pipeline for MSSPs.

Healthcare organisations face a shortage of skilled cybersecurity professionals, making MSSPs a cost-effective solution to bolster defences amid rising threats.

Data Security and Privacy Specialists

Companies focused on protecting sensitive patient data—through encryption, data loss prevention (DLP), or blockchain-based solutions are critical as breaches involving Protected Health Information (PHI) escalate.

Thales’ 2023 acquisition of Imperva (data and application security) and IBM’s 2023 purchase of Polar Security (data security posture management) set the stage for similar deals in 2025.

The high black-market value of PHI and stringent regulations (e.g., GDPR, HIPAA) make data-centric security a priority for investors and acquirers.

Third-Party Risk Management and Supply Chain Security Firms

Companies addressing vulnerabilities in healthcare supply chains and third-party vendors (e.g., billing systems, EHR platforms) are increasingly relevant following incidents like the 2024 Change Healthcare attack.

The focus on third-party risk is evident in 2024’s HHS Cybersecurity Performance Goals, which emphasise supply chain security, likely spurring 2025 investments in firms like Censinet or Critical Insight.

High-profile breaches highlight the "blast radius" effect of third-party attacks, pushing healthcare organisations to invest in solutions that secure their extended ecosystems.

Endpoint Security and Ransomware Defense Providers

Firms offering robust endpoint protection and ransomware mitigation tools are vital, given the prevalence of ransomware attacks targeting healthcare (e.g., 278% increase in large ransomware breaches from 2018–2022 per HHS).

SentinelOne’s 2023 enhancement via PinnacleOne and Check Point’s SASE-focused acquisitions in 2024 suggest ongoing interest in endpoint and ransomware solutions for 2025.

Healthcare’s reputation for paying ransoms and its reliance on critical endpoints (e.g., medical devices) make these companies attractive targets.

Key Drivers of Funding and Acquisitions in 2025

Regulatory Push: Initiatives like the Biden administration’s 2025 budget proposal, which includes $141 million for HHS cybersecurity and potential Medicare penalties for non-compliant hospitals, are incentivising investment in compliance-focused solutions.
Private Equity (PE) Activity: PE firms, with significant "dry powder," are targeting healthcare cybersecurity, as seen in 2024 deals like KKR’s stake in Cotiviti, with expectations of continued momentum in 2025.
Market Growth: The global healthcare cybersecurity market is projected to grow from $19.3 billion in 2024 to $75.04 billion by 2032 (CAGR of 18.5%), fueling both venture capital and M&A activity.
Cyberthreat Evolution: The rise of AI-driven attacks and the lingering impact of incidents like Change Healthcare are pushing companies to acquire or fund innovative, proactive solutions.

In 2025, healthcare cybersecurity companies attracting funding and acquisitions are those addressing AI-driven threats, cloud and IoMT security, managed services, data privacy, supply chain risks, and endpoint/ransomware defence. These areas reflect the sector’s urgent needs: protecting patient data, ensuring operational continuity, and meeting regulatory demands in an increasingly digital and interconnected healthcare ecosystem. While specific deals from mid-to-late 2025 are yet to unfold, the trajectory from late 2024 and early 2025 insights points to a robust market for these specialized firms.

Nelson Advisors > HealthTech M&A

Nelson Advisors specialise in mergers, acquisitions and partnerships for Digital Health, HealthTech, Health IT, Healthcare Cybersecurity, Healthcare AI companies based in the UK, Europe and North America. www.nelsonadvisors.co.uk

We work with our clients to assess whether they should 'Build, Buy, Partner or Sell' in order to maximise shareholder value and investment returns. Email lloyd@nelsonadvisors.co.uk

Nelson Advisors regularly publish Healthcare Technology thought leadership articles covering market insights, trends, analysis & predictions @ https://www.healthcare.digital

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What type of Healthcare Cybersecurity companies are being funded in 2025?

The healthcare cybersecurity sector is experiencing significant investment driven by escalating cyber threats, regulatory pressures, and technological advancements. While the full scope of 2025 funding is still unfolding, trends from late 2024 and early 2025, combined with market insights, highlight the types of companies attracting funding.

Here’s a breakdown of the key categories:

AI-Driven Cybersecurity Startups

Companies using artificial intelligence (AI) and machine learning (ML) for advanced threat detection, predictive analytics, and automated response are drawing significant attention. These solutions excel at identifying anomalies in real time and adapting to sophisticated attacks like AI-powered phishing or malware.

Investors see AI as a game-changer for tackling the complexity and scale of modern cyber threats in healthcare, where rapid response is critical to protect patient data.

Building on 2024’s momentum (e.g., Normalyze’s funding rounds for AI-based data security), early 2025 shows venture capital flowing into startups enhancing AI-driven defences tailored to healthcare.

Cloud and IoT Security Innovators

Startups specialising in securing cloud infrastructure and Internet of Medical Things (IoMT) devices—such as connected medical equipment—are in high demand. This includes endpoint protection, secure cloud migration tools, and IoMT-specific threat management.

The healthcare industry’s shift to cloud-based systems (e.g., EHRs) and the proliferation of IoMT devices have created new attack surfaces, necessitating specialized protection that ensures HIPAA compliance.

Companies like Cylera (IoMT security) saw funding interest in 2024, a trend continuing into 2025 as cloud adoption accelerates.

Managed Security Service Providers (MSSPs)

MSSPs offering outsourced cybersecurity services—such as continuous monitoring, incident response, and compliance support—are gaining traction among investors. These startups cater to healthcare organisations with limited in-house resources.

The persistent shortage of cybersecurity talent in healthcare (exacerbated by rising threats) makes MSSPs an attractive, scalable solution for hospitals and clinics.

Early 2025 funding rounds echo 2024’s activity, like Lumifi’s growth in healthcare-focused managed services, signalling strong investor confidence.

Data Security and Privacy Specialists

Startups focused on protecting sensitive patient data through encryption, data loss prevention (DLP), or emerging technologies like blockchain are seeing robust funding. These companies prioritise safeguarding Protected Health Information (PHI).

The high value of PHI on the black market and strict regulations (e.g., GDPR, HIPAA) drive demand for innovative data protection solutions, especially post high-profile breaches.

Following 2024 investments in data-centric firms, 2025 is witnessing continued support for startups enhancing privacy and compliance tools.

Third-Party Risk Management Ventures

Companies developing platforms to assess and mitigate risks from third-party vendors and supply chains (e.g., billing systems, EHR providers) are increasingly funded. These solutions address vulnerabilities exposed by incidents like the 2024 Change Healthcare breach.

The interconnected nature of healthcare ecosystems amplifies the impact of third-party breaches, making risk management a priority for investors seeking to bolster systemic resilience.

Startups like Censinet, funded in prior years, are seeing renewed interest in 2025 as regulatory bodies emphasize supply chain security.

Endpoint Security and Ransomware Defence Startups

Companies building advanced endpoint protection and ransomware mitigation tools are securing funding to combat the persistent threat of ransomware, a major concern in healthcare due to its operational and financial impact.

Healthcare’s vulnerability to ransomware (e.g., a 278% increase in large breaches from 2018–2022 per HHS) and its reliance on critical endpoints (e.g., medical devices) make these startups critical to the ecosystem.

Early 2025 investments build on 2024’s focus on endpoint security, with startups offering next-gen anti-ransomware capabilities gaining traction.

Key Drivers of Funding in 2025

• Regulatory Incentives: The Biden administration’s 2025 budget proposal, including $141 million for HHS cybersecurity and potential Medicare penalties for non-compliant hospitals, is pushing startups to innovate in compliance-focused solutions.

• Venture Capital Appetite: With a projected healthcare cybersecurity market growth from $19.3 billion in 2024 to $75.04 billion by 2032 (CAGR of 18.5%), venture capital firms are actively funding early-stage companies addressing unmet needs.

• Threat Landscape: The rise of AI-driven attacks and the fallout from 2024 breaches (e.g., Change Healthcare) are fuelling investment in proactive, cutting-edge cybersecurity solutions.

• Digital Transformation: Healthcare’s ongoing digitization—via telehealth, cloud systems, and IoMT—creates demand for startups that can secure these technologies.

In 2025, healthcare cybersecurity companies attracting funding are those leveraging AI, securing cloud and IoMT environments, providing managed services, protecting data privacy, managing third-party risks, and defending against ransomware. These startups align with the industry’s urgent needs: safeguarding patient data, ensuring operational continuity, and meeting regulatory standards in a rapidly digitising healthcare landscape. While specific funding rounds from mid-to-late 2025 are yet to fully emerge, the early-year momentum and prior-year trends strongly indicate these categories as investor favourites.

What type of Healthcare Cybersecurity companies are being acquired in 2025?

The healthcare cybersecurity sector is witnessing a dynamic wave of acquisitions, reflecting the urgent need to address escalating cyber threats, regulatory demands, and technological shifts in healthcare.

Insights from late 2024 and early 2025 trends, combined with industry analyses, reveal the types of healthcare cybersecurity companies being acquired. These acquisitions are driven by larger firms seeking to enhance capabilities, expand market presence and integrate advanced technologies.

Here’s a breakdown of the key categories:

AI-Driven Cybersecurity Firms

Companies leveraging artificial intelligence (AI) and machine learning (ML) to provide advanced threat detection, automated response, and predictive analytics are prime acquisition targets. These firms specialise in countering sophisticated, AI-powered cyberattacks like phishing and autonomous malware.

Acquirers aim to integrate AI capabilities to enhance real-time threat monitoring and response, critical for protecting sensitive healthcare data amid rising attack complexity.

Late 2024 saw Proofpoint acquire Normalyze (AI-driven data security posture management) and Cisco acquire Robust Intelligence (AI security). This momentum is carrying into 2025, with larger players targeting similar AI-focused firms to stay ahead of evolving threats.

Cloud Security and IoMT Specialists

Firms offering cloud security solutions and protection for Internet of Medical Things (IoMT) devices, such as connected medical equipment, are highly sought after. These include endpoint protection, encryption, and cloud security management tailored to healthcare’s digital transformation.

The rapid adoption of cloud-based systems (e.g., EHRs) and IoMT devices in healthcare has expanded the attack surface, making specialized security essential for compliance and operational continuity.

Companies like ClearDATA (cloud security) and Cylera (IoMT security) have been on acquisition radars, with early 2025 signalling continued interest as healthcare’s reliance on these technologies grows.

Managed Security Service Providers (MSSPs)

MSSPs providing outsourced cybersecurity services—such as 24/7 monitoring, incident response, and compliance management—are being acquired to meet the needs of healthcare organisations lacking internal expertise.

The ongoing cybersecurity talent shortage and the need for scalable, cost-effective solutions drive acquirers to bolster their service offerings with MSSP capabilities.

Lumifi’s 2024 acquisitions to expand healthcare cybersecurity services and Accenture’s purchase of Innotec Security (cybersecurity-as-a-service) set the stage for more MSSP-focused deals in 2025.

Data Security and Privacy Experts

Companies specializing in data protection, through encryption, data loss prevention (DLP) or blockchain, are being snapped up to secure Protected Health Information (PHI) and ensure regulatory compliance.

The high black-market value of PHI and stringent regulations (e.g., HIPAA, GDPR) make data security a top priority, prompting acquirers to strengthen their portfolios with privacy-focused solutions.

Thales’ 2023 acquisition of Imperva (data and application security) and IBM’s 2023 purchase of Polar Security (data security posture management) indicate a sustained 2025 focus on data-centric firms.

Third-Party Risk Management Providers

Firms offering tools to manage and mitigate risks from third-party vendors and supply chains (e.g., EHR platforms, billing systems) are increasingly attractive, especially after incidents like the 2024 Change Healthcare breach.

The interconnected healthcare ecosystem amplifies third-party vulnerabilities, pushing acquirers to integrate solutions that secure the supply chain and reduce systemic risk.

Early 2025 builds on 2024’s regulatory emphasis (e.g., HHS Cybersecurity Goals), with companies like Censinet drawing acquisition interest for their third-party risk expertise.

Endpoint Security and Ransomware Defence Companies

Firms providing endpoint protection and ransomware mitigation tools are key targets, given ransomware’s dominance in healthcare cyberattacks (e.g., a 278% increase in large breaches from 2018–2022 per HHS).

Healthcare’s reliance on critical endpoints (e.g., medical devices) and its history of paying ransoms make these companies valuable for acquirers aiming to offer comprehensive defence solutions.

SentinelOne’s 2023 enhancement via PinnacleOne and Check Point’s 2024 SASE acquisitions suggest ongoing 2025 interest in endpoint and ransomware-focused firms.

Key Drivers of Acquisitions in 2025

• Regulatory Pressure: The Biden administration’s 2025 budget, with $141 million for HHS cybersecurity and potential Medicare penalties for non-compliant hospitals, is pushing acquirers to target companies that enhance compliance capabilities.

• Private Equity (PE) Involvement: PE firms, flush with capital, are driving consolidation, as seen in 2024 deals like KKR’s stake in Cotiviti, with expectations of increased activity in 2025.

• Market Expansion: The healthcare cybersecurity market, projected to grow from $19.3 billion in 2024 to $75.04 billion by 2032 (CAGR of 18.5%), motivates acquirers to bolster portfolios and capture market share.

• Threat Evolution: The rise of AI-driven attacks and lessons from 2024 breaches (e.g., Change Healthcare) are accelerating acquisitions of innovative, proactive security providers.

In 2025, healthcare cybersecurity companies being acquired are those excelling in AI-driven solutions, cloud and IoMT security, managed services, data privacy, third-party risk management, and endpoint/ransomware defence. These acquisitions reflect a strategic push by larger firms and PE investors to address healthcare’s pressing needs: protecting patient data, ensuring operational resilience, and meeting regulatory standards in a digitally transforming landscape. While specific mid-to-late 2025 deals are yet to fully materialise, the trajectory from late 2024 and early 2025 strongly points to these categories as acquisition hotspots.

Nelson Advisors > HealthTech M&A

We work with our UK, European and North American clients to assess whether they should 'Build, Buy, Partner or Sell' in order to maximise shareholder value and investment returns, with average client engagements lasting 6 to 9 months. Email lloyd@nelsonadvisors.co.uk

Nelson Advisors regularly publish Healthcare Technology thought leadership articles covering market insights, analysis & predictions @ https://www.healthcare.digital