Building and Investing in The Human Needs Economy

Human Ventures
Jun 3, 2020 · 10 min read

Part 1: Health & Wellness

The entrepreneurial and investor focus of the last decade has largely been centered on increased convenience and consumerism, and has encouraged companies to prioritize scaling, with little care for how it affects stakeholders, employees, consumers and even the environment. We have been talking about a shift for some time, but now more than ever, it has become obvious that companies have to take humanity into account as they build and scale in this new paradigm.

The last 10 years of startup growth have been about building and investing in these “nice to haves.” We believe the next 10 years will be focused on building and investing in “need to haves,” and the greatest business opportunities will be found in what we at Human Ventures call The Human Needs Economy — products and services that have material impact on basic needs and livelihoods and address a core draw on a consumer’s time, money or energy. For 2020, we are focusing on solving problems within three categories that we believe will have a huge impact on the Human Needs Economy: health and wellness, the future of work, and community.

As the first category of the Human Needs Economy, we outline the opportunity within health and wellness and specific areas in which we are excited to build and invest.

Health and wellness

Looking back at a decade focused on scaling nice to haves, it shouldn’t come as a surprise that we are living with unaddressed health and wellness issues. And the statistics are staggering. In 2019, an estimated 47.6 million adults (19% of the country) had a mental illness, but only 43% received any kind of mental health care. When it comes to sexual and reproductive health, whole populations of minorities and underrepresented groups receive subpar care and face stigma around health issues. And we’re on track for a shortage of 120,000 doctors in the U.S. by 2030, a signal that these issues are set to get worse. (The United States’ response to the COVID-19 pandemic has highlighted how dangerous this is in a crisis.)

These challenges and others represent what we call the wellness deficit — the sum of human needs that have gone unmet in the areas of health and wellness. And even though it may seem that every block has a new boutique fitness studio popping up or everyone you know has the latest wearable to measure their sleep, we believe we are just at the starting line when it comes to making up ground and building great businesses that tackle these issues.

Below are 10 areas that are poised to make up this wellness deficit:

  1. Mental Health

Many of these themes have come to us as we’ve been actively building or investing in startups over the last five years and connecting with thousands of founders looking to build their next company. Others are themes that the inaugural cohort of Humans in the Wild are exploring.

These areas will be periodically updated and are meant to be part of a living thesis. We hope this spurs your entrepreneurial spirit, and if you are building in these spaces, we would love to connect with you. You can reach out to us here.

1. Mental health

While mental health care may seem widespread today, for large portions of the world mental health is still a stigmatized subject and access to care is still limited and expensive. Mental health is a big driver of the wellness deficit, contributing to more disabilities than any other ailment and 30% of the world’s non-fatal disease burden. But the tide is changing, and as more and more people are looking for new kinds of mental health services, we believe we’re about to see innovative mental health services accelerate — services that leverage telemedicine, communities, are breaking down barriers and stigmas, and focus on specific use cases and provide tailored solutions, and lean into behavioral data to power digital therapies. Human Ventures has been focused on mental health across multiple categories as co-builders of Village, which focuses on addiction, and Weldon, which provides coaching and support to parents.

2. Women’s health

Women’s health has been historically underserved — for example, over 75% of women who seek care for menopausal symptoms don’t receive it — but we see this changing. The “femtech” industry is set to grow into a $50 billion market by 2025, accelerated by the fact that women are increasingly playing a more active role in their own healthcare. And while historically women-centered healthcare was focused on sexual health, fertility and maternity, we believe we are at the turning point where women’s health will range into all issues that impact women differently or more severely than men, including mental health, various chronic conditions and even financial and social health.

We also believe we are still in the early days of stigmas being broken related to sexual health, and we’ll continue to see innovation in family planning, fertility, maternity and postpartum care, and menopause. Human Ventures has invested in companies like Tia, a digital-first medical practice that provides sexual wellness and general health services tailored toward young women, and Elektra Health, which provides health and wellness services for menopausal-aged women, that typify the new kind of women’s health startup.

3. Food and nutrition

We believe we are at the cusp of a new wave of health-focused foods — plant-based is replacing “organic” as the driver of a healthy diet. Indeed, 17% of the U.S. population now consider themselves “plant forward” and even more are looking for — and willing to pay a premium for — natural, ethical or “less of” foods. This is all being driven by trends that are here to stay: consumers are increasingly becoming educated about their food choices, retailers are now stocking more brands that are healthy out of the need for diversity and higher margins and big companies are getting into the game and changing established products into healthier offerings.

We expect to see more functional foods focused on specific populations and use cases, as well as foods that cater to health and wellness lifestyles. We’re also excited for food to be treated as medicine and become part of the standard of care for various chronic diseases. Human Ventures has been focused on food and nutrition, having co-built Lupii in 2019, a new plant-based protein company leveraging the lupini bean, and Tiny Organics in 2018, which is helping parents raise adventurous eaters by offering plant-based, whole-food frozen baby foods.

4. Telehealth and wellness

Digital health has seen a boom in the last five years, with numerous telehealth, at home testing and modern medical practices coming onto the scene. These companies tackled many of the challenges facing healthcare innovation — how to navigate regulation, build HIPAA-compliant products that deliver a full standard of care and how to deliver a delightful consumer experience while still playing ball with payers and legacy infrastructures. And we’ve seen a drastic rise in consumers leveraging these services — live video telemedicine usage increased from 19% of all healthcare recipients in 2017 to 34% in 2018.

We are big believers that digital-first forms of care and therapeutics will drive the future of medicine. As regulations continue to evolve, we expect to see more and more specialties go fully digital and become augmented by technology. We expect to see both therapy or specialty-specific practices, as well as practices that focus on specific consumer segments. The recent global crisis around COVID-19 pushed many providers and services into telehealth, only accelerating the shifts. In 2018, Human Ventures co-built Paloma Health, a digital telemedicine practice for hypothyroidism, and we believe there are many more digital health startups waiting to be built.

5. Elderly care

The number of Americans aged 65 or older is set to nearly double, from 52 million in 2018 to 95 million, as Baby Boomers and Gen X move into retirement age. As this massive population shift unfolds, we see a confluence of trends driving new challenges — and innovations. This vast growth will bring with it a shortage of caregivers. At the same time, the elderly face high rates of comorbidities, and a high likelihood of loneliness. Potentially offsetting these trends is the opportunity yielded by the increasing comfort and adoption of technology among the elderly.

We see opportunities to provide solutions for family caretakers who are on the front lines in caring for the elderly. We expect to see innovation that meets growing needs in senior loneliness and mental health needs. We expect solutions to enable seniors to age in place, or to solve the crisis in affordable senior housing and care facilities. Relatedly, we expect many senior-focused therapy areas to be upended by technology — whether it’s providing physical therapy to detecting cancer to new treatments for Alzheimer’s.

6. Sleep

Since Matthew Walker published Why We Sleep in 2017 and brought to light the widespread and serious impacts of sleep deprivation, we’ve noticed a growing consciousness of sleep as a key pillar for holistic health. We’re also living in a moment when an estimated 58% of Americans suffer from some form of insomnia or sleep deprivation. We’re also seeing a shift in how people treat their sleep challenges — a decade ago, sleeping pills were the entire market, but now make up just 65%.

We expect to see many new sleep-related products and sleep-related supplements that promise to help people sleep better and offer an alternative to medication. We also expect to see more consumerization of sleep medicine, with wearables and more accessible sleep labs helping people who suffer from sleep apnea and other diagnosable ailments. And we expect new solutions that tackle the underlying challenge of poor sleep hygiene — a daunting task but one with a huge payoff.

7. Loneliness

Loneliness is the silent epidemic sweeping across much of the country, as almost half (47%) of all Americans report feeling alone or left out. Loneliness affects both the young and the old, contributing to both mental health and physical health issues. In fact, Gen Z is the most lonely age group, while in the elderly loneliness is a real health danger that brings with it an increase in functional decline. Solutions we hope to see range from new community-driven businesses that foster deeper interactions, to public spaces designed to give people places to go and interact, intergenerational living arrangements that help both the old and young build relationships and peer-based programs that go beyond digital social media.

8. Alternative medicine

Alternative medicine is increasingly becoming mainstream, growing at a rate of 19.9% from 2016 through 2019, with no signs of stopping. As yoga, meditation, magnetic intervention, acupuncture and other alternative therapies become more generally accepted, funding is increasing for clinical trials that showcase effectiveness, and more mainstream health professionals are now beginning to offer integrated medicine. While the market is growing, it is largely fragmented, with a handful of large players providing supplements and services, but the vast majority of the market is made up of small businesses.

We see opportunities to both organize the market and create better ways to access and consume alternative medicine. We also expect to see various chronic conditions become targets of alternative medicine, as distrust in the medical establishment rises and people desire to take less medication.

9. Personal care

The world of personal care and beauty is moving much like the world of food and other consumer products — lifestyle trends such as the desire for organic, natural ingredients or an increased demand for personalized products are driving shifts in the industry. As populations age, more attention is paid to a rising concern for skin health. And for younger, digitally native generations who are now entering the market, trends such as social commerce and a strong desire for self expression are creating an unprecedented opportunity to build new consumer brands.

As with food, we see these macro trends driving opportunities to create products that fit new buying behaviors, speak to new consumer segments both young and old and displace legacy brands on the shelves of retailers looking to stay relevant with customers.

10. Personal fitness

The world of fitness is rapidly becoming one where consumers are passing on the traditional gym membership model for new ways to stay fit, including in-home equipment, streaming fitness content, boutique studios and new types of communities. The proliferation of boutique fitness studios, kicked off by SoulCycle, is likely nearing a peak, but continues to signal that consumers are after more than just a place to work out.

Successes like Peloton, Mirror and Zwift have shown the appetite for solutions that offer complete fitness experiences at home, and we expect to see more solutions that combine equipment, content and community. We’re also seeing a rise of fitness personalities like Taryn Toomey, but ranging from physical trainers to SoulCycle instructors, who gain a following and leverage new platforms to provide unique workouts directly to their fans. We also see new platforms and communities tailored for the non-athlete, for the majority of us who aren’t yet fit but are increasingly looking to be so as we focus more on our health — like WayBetter, a company that cleverly combines a platform and community to encourage people to reach their fitness goals.

Human Ventures is a business creation platform. We invest in and build early-stage businesses with ambitious founders who are innovating around human needs. By unlocking access to a powerful network of founders, investors and corporate partners, we are creating a blueprint for the future of business to be built on purpose. If you are building or investing in any of these health and wellness areas or the broader Human Needs Economy, we’d love to hear from you.

This was originally published in TechCrunch by Heather Hartnett. Human Ventures plans to focus on the Future of Work in its next cohort.

Human Ventures

This is where we share all the latest news and thinking…

Human Ventures

This is where we share all the latest news and thinking from Human Ventures, with articles about our startups, our studio, and our approach to company-building.

Human Ventures

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Human Ventures is a business creation platform. We go beyond the business model and seek opportunities to build Model Businesses with ambitious founders.

Human Ventures

This is where we share all the latest news and thinking from Human Ventures, with articles about our startups, our studio, and our approach to company-building.

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