The healthcare software sector continues to see consolidation. According to Capstone Partners, deal activity in the healthcare IT sector increased for the third consecutive year in 2024, with over 260 transactions recorded globally. PwC’s H1 2025 report also demonstrated that though deal volumes in the space had fallen, deal values increased by about 50%. Strategic buyers are looking for integrated platforms, while private equity firms are backing roll-up strategies focused on clinical and administrative tools with a clear market demand and strong customer growth.

This trend reflects a shift in how healthcare providers approach technology procurement. Buyers are prioritising scalable platforms over standalone solutions. They are looking for vendors that can offer broad functionality, seamless integration, security, and enterprise-grade compliance. As virtual consultations and remote patient monitoring become more common, the ability to integrate across clinical workflows is critical.

Aalto Capital recently advised on the sale of Induction Healthcare to VitalHub, a Toronto-listed acquirer of healthtech platforms. Induction, with its suite of applications tailored to the NHS, is now part of a broader group supporting patient engagement and the coordination of care across the UK and Canada. The transaction reflects what buyers are targeting today in the UK: proven technology and embedded NHS relationships.

Investors are increasingly focused on healthtech platforms with recurring revenues, modular product design, and strong clinical relevance. Founders who are building companies where there is a strong market demand for their products but limited scale may find that now is the right time to engage with strategic partners. The market is rewarding businesses that solve real problems in complex care settings.

The Induction and VitalHub combination is a clear example of this thesis. It shows how UK software companies can become part of larger platforms while continuing to drive real impact across the domestic healthcare system.

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