Innovation in Family Planning, Fertility, and Maternal Care
Thesis Statement
The industry sector we’ve come to know as FemTech is expansive. At Chingona, we think of it as any technology that centers on women’s physical or mental health. This definition covers many segments, including behavioral health, reproductive health, and many other topics. The proliferation of female-focused technology and startups carries the potential to solve major pain points for women from different backgrounds and with different needs. The problems solved in this market are essential because they have the power to bring attention to challenges that have been traditionally ignored or diminished in male-dominated circles and pave the way toward more equitable care and treatment for women.
Here, we’ll focus specifically on the family planning and maternal care verticals within FemTech. Fertility and maternity outcomes can vary widely for women and couples based on race and socioeconomic backgrounds. With the increasing use of assisted reproductive technology (ART) and increasing costs for accessing quality care, solutions that bridge this gap for mothers and families have a unique opportunity to disrupt a growing market and provide tangible value to patients and customers.
Background
When assessing startups, investors often look for founders with backgrounds that point to a certain level of knowledge or empathy with the market and customers they are looking to serve. The energy exhibited by founders with this type of market fit can be exhilarating. Certain opportunities and verticals can be just as energizing from an investor’s perspective.
Alongside my partner, I’ve had the opportunity to experience up close many of the physical, mental, and financial stressors that can come with family planning. In addition, I’ve personally witnessed friends, loved ones, and relatives embark on their own fertility journeys with various outcomes in the end. Knowing the ups and downs of such an emotional journey makes it all the more exciting to discover new ideas and startups that promise to deliver far more ups than downs in the future.
From family planning and conception to pre and post-natal care, women, couples, and families have ever-changing needs that are not always met effectively by legacy healthcare systems and infrastructure.
To better understand where family planning fits within the broader fertility and maternity category, we will define companies and products along the stage of the health cycle where they plan to engage and provide value to customers. It’s important to note that many products look to deliver holistic solutions that could provide value to consumers across multiple stages.
Focusing on family planning, around one in six couples seek treatment for infertility (source). This has driven a 5–10% annual increase in couples seeking to use ART each year (source). These treatments can often be financially, physically, and emotionally taxing for the individuals who seek them out.
Chingona Ventures is uniquely positioned to invest in these verticals. The fund employs a team that brings diverse perspectives to problem areas like this one. She Matters and Expectful are two recent investments that demonstrate Chingona’s ability to identify and source startups dedicated to solving difficult problems from a unique perspective.
Trends
There are a few reasons why right now is the appropriate time for investors to explore these verticals. First, FemTech has been a historically underinvested and under-researched sector, accounting for only 1.4% of capital invested in healthcare. Bias from male investors and unique fundraising challenges faced by founders who tend to be overwhelmingly female has hindered the number of investments in this area. Even so, investment in the space has increased each year since 2011, reaching $1.4 billion in 2021, an 80% increase from the $773 million seen in 2020 (source). With the increasing level of attention on the FemTech vertical and an increase in investors knowledgeable of the idiosyncrasies of female-specific healthcare challenges, there is ample opportunity for innovation within the sector.
Another reason to pay attention to this vertical is the continued advancement of artificial intelligence and machine learning for healthcare-based applications. As these technologies mature, personalized technology-enabled solutions will become more viable and effective for the consumers they hope to serve.
Finally, changes in the broader social, political, and economic environment have driven entrenched, legacy systems to reconsider how they provide service and care for marginalized people. An example of this shift is the fact that 42% of large employers in the U.S. offered coverage for in vitro fertilization in 2020, nearly double the less than a quarter of companies that offered the same in the previous two decades (source).
Even with significant momentum signaling continued growth and interest, obstacles still exist. In the U.S., women’s reproductive rights face an uncertain future. Decisions made by lawmakers could have far-reaching effects on the treatment options available to women for abortion, miscarriages, fertility treatments, and many other critical issues. Many of these changes can negatively impact some of the most vulnerable and marginalized women in the country. Founders and startups operating in this space will have to navigate a shifting legal and cultural landscape while finding ways to serve and provide value to their customers. In addition, entrepreneurs in this space often seek to solve challenging and complex medical problems where success can be difficult to measure, introducing further complications. Despite these challenges, this remains a sector worth following closely.
Funding
Bolstered by increased demand for access to ART, the market for fertility-focused solutions is expected to reach $41 billion by 2026. Venture capital investments in the vertical equaled $345 million in 2021, a 35% increase from 2020 and more than double the $133 million raised in 2019 (source).
All signs point to funding continuing to increase. Working-age women, of whom 22% have problems conceiving their first child, spend 29% more per capita on healthcare than men and are 75% more likely to use tech-enabled healthcare tools (source, source). As investment in the sector grows, family planning solutions that focus on increasing accessibility and inclusivity of fertility treatments should receive increased attention from investors.
Future
Below is an abbreviated list of startups operating within this vertical at various fundraising stages:
Final Thoughts
As the family planning, fertility, and maternity market continues to grow, we should expect to see increased attention from investors and increased opportunities for breakthrough innovations and technologies. Companies that can successfully navigate cultural shifts and help improve access to cost-prohibitive treatments and medications and provide holistic solutions to families will garner interest from investors and consumers alike.
Check me out on Twitter @braylongurnell to continue the conversation.
