Digital health startups are beginning to secure large funding rounds after a prolonged exit drought, though capital remains unevenly distributed.
Now preparing for an IPO, smart ring maker Oura Health is shaping up to be a key test of whether public markets are ready to underwrite a new wave of consumer-facing health technology firms.
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The stakes extend beyond a single wearable. Pandemic-era enthusiasm for fitness and wellness hardware has cooled, as companies such as Peloton Interactive Inc (NASDAQ:PTON)struggled to sustain demand, leaving investors wary of hardware-heavy models tied to discretionary spending. Oura's debut could help reset that narrative.
Recent data underscores that the market has not stalled, but it has changed shape.
According to a report from Galen Growth, "Between January 2023 and December 2025, 620 digital health ventures were acquired or taken public, generating a cumulative exit value of $36.3 billion.”
“For much of the past three years, digital health has lived in the long shadow of its own excesses,” the report stated. “The exuberant valuations of 2020–’21 gave way to a sharp correction as rising rates, tighter capital markets, and more skeptical public investors reset expectations for the sector. Against that backdrop, exit activity from 2023 to 2025 suggests less a frozen market than a repricing of risk. The market has not disappeared; it has recalibrated.”
Unlike earlier wearable companies that relied primarily on device sales, Oura has increasingly leaned into a subscription model layered on top of its hardware. Users pay recurring fees for insights into sleep, recovery, stress and readiness generated from biometric data collected by the ring. That data layer has become central to its investor narrative, shifting attention from hardware sales toward long-term engagement and health insights.
Private investors say recent digital health IPOs, including Hinge Health Inc (NYSE:HNGE), are emerging as important reference points for the sector, helping reset valuation expectations in public markets.
Andreessen Horowitz general partner Julie Yoo previously told Axios that investors were closely watching the first wave of digital health listings, describing the Hinge Health debut as a key moment that would help "set the stage" for the broader category.
The competitive landscape remains crowded, with major technology companies such as Apple Inc (NASDAQ:AAPL) and Samsung continuing to expand their health ecosystems. Samsung introduced its own Galaxy smart ring last year, while Apple continues to expand its health features across its Apple Watch.
A key question is whether Oura can move beyond its core enthusiast base and scale into a mainstream health platform without diluting its premium positioning.
Ultimately, Oura's IPO may serve as a broader barometer for whether public markets are once again willing to underwrite digital health companies at scale — or whether wearable wellness businesses are still viewed primarily through the lens of cyclical consumer hardware.
Photo courtesy of Oura Health Media Kit
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