Digital health companies scored $57.2 billion in funding worldwide last year across 2,930 deals, increasing 79% from 2020, according to CB Insights' State of Digital Health 2021 Report.

"Funding in all geographies hit record levels in 2021, fueled by the growing need to provide digital solutions and delivery models to patients during the pandemic," the report's authors wrote. 

However, the U.S. market led the pack, scoring $37.9 billion in 2021, with $10.8 billion raised in the fourth quarter alone. 

Meanwhile, those startups were raising plenty of cash in those funding rounds. The number of digital health mega-rounds, worth $100 million or more, nearly doubled to 154 last year. These rounds made up 57% of total funding in the fourth quarter and 61% in the first quarter. 

Another big trend in the digital health market: consolidation. The report noted 574 M&A deals, an increase of 44% from 2020. M&A peaked in the second quarter, with 170 deals, but the digital health space still saw 110 M&A exits in Q4.

Some of the large M&As in the last quarter of the year include Walgreens upping its stake in VillageMD, Best Buy's acquisition of Current Health, 23andMe's purchase of Lemonaid Health, Claroty's deal with Medigate and Oak Street Health's acquisition of RubiconMD.

The space now boasts of 85 unicorns, companies with a valuation of $1 billion or greater. Thirteen new unicorns joined the herd in the final quarter of the year, and six of them include telehealth offerings. 

Some of the largest new unicorns by valuation in Q4 include decentralized clinical trial platform Medable, digital musculoskeletal care company SWORD Health, artificial intelligence startup H20.ai, digital pharmacy and telehealth company Truepill and Indian fitness company CureFit. 

Some areas of focus for the report include digital therapeutics, which raised $3.4 billion across 122 deals last year; clinical trial technology, which increased 53% year over year; telehealth, which scored $17.6 billion across 628 deals; and health IT, which saw funding rise 54% to 8.6 billion.

Mental health-and-wellness companies were also a huge area for growth, with funding rising 139% year over year in 2021. 

"This was driven largely by the need to build out digital solutions targeting mental health – an area of healthcare that has gained momentum during the pandemic," the report's authors wrote. "Sixty-eight percent of 2021 deals were early-stage – indicating room for further growth in the mental health tech space."