The Titty Gritty: What VCs Need To Know About Investing In Breastfeeding Tech
A quick Google for “FemTech” will serve up multiple articles about how the sector is moving from “niche to essential”. How, an industry serving 50% of the world’s population, could ever have been considered niche demonstrates how much the VC ecosystem has previously and continues to underestimate the importance of FemTech and the opportunity it presents us.
What is FemTech?
The term “FemTech” was coined in 2016 by Ida Tin, founder of period tracking app, Clue. According to FemTech Labs, FemTech is:
“Software, diagnostics, and products for:
Female specific health issues such as fertility & birth control, menstruation & period care products, menopause, chronic conditions & hormonal disorders, pelvic health, pregnancy & post pregnancy, breast feeding, sexual wellness.
Emerging health spaces that recognise gender specific healthcare, wellness & mental health such as osteoporosis, breast cancer, autoimmune conditions, stroke, thyroid issues, chronic fatigue, anxiety, and depression.
Products that empower women: such as personal finance and education.”
And as for “Breastfeeding Tech”, it is equipment or services used for the optomisation and management of breastfeeding.
What’s happened so far?
In 2021, global funding for FemTech reached $1.2B according to Crunchbase. Companies who have raised substantial amounts are Elvie ($151.9M), Kindbody ($154.7M), and Minerva Surgical ($143.9M). Maven Clinic raised $202.1M, $110 in their Series D that closed in August 2021 and made them the first FemTech unicorn.
The Femtech market as a whole
The FemTech landscape is currently large and widely untapped. There are many differing opinions on how big the market actually is. Global Market Insights predicts it will reach >$65B by 2027, Statista counters that with a $60B valuation but according to the 2021 FemTech Landscape report by FemTech Focus and Coyote Ventures, the market will have an estimated $1.816T worth by 2027. 35% of that market size will be in chronic conditions and reproductive health and 15% in breast and uterine health (Coyote Ventures).
Why is there such a disparity in the valuation of the market?
In an ecosystem such as VC that has low female representation, there is not a deep understanding of what constitutes FemTech and how high the demand is. This leads to the market and opportunity being undervalued, underestimated and underfunded.
The Breastfeeding Market
Breastfeeding is natural and women already have the equipment, what’s the problem?
Research states that increasing breastfeeding rates could save 800,000 children’s lives a year globally and an additional 20,000 women’s lives by preventing breast cancer.
94% of mothers intend to breastfeed, 81% of mothers initiate breastfeeding but only 69% continued at 1 week old, 34% are still breastfeeding at 6 months and 0.5% at 12 months. The reason for this precipitous drop in breastfeeding has been attributed to practical problems and lack of access to support. This then combines with concern about whether a baby is receiving enough milk. The issue is further compounded by pressure from medical professionals, friends and family to “top up” with formula, which ultimately undermines milk production and leads to the milk supply drying up.
There are four areas of breastfeeding where a mother needs help: Equipment, Optimisation, Pain Management and Breast Accessories.
As outlined, breastfeeding is hard and the support around it is antiquated. In the UK, access to lactation support is governed by geography. There are Breastfeeding / Baby Cafés where breastfeeding support is provided by a lactation consultant for the price of a coffee or a small donation to a charity. There are Instagram lactation specialists and there are breastfeeding sessions run as part of an antenatal class. There is also the National Breastfeeding Helpline and NCT breastfeeding helpline. However, there are a number of barriers to entry to access the aforementioned resources:
- Financial: organisations such as NCT offer breastfeeding workshops as part of their antenatal classes but these courses are £250 — £300 and seeing a lactation consultant will set you back £60–80/hour
- Awareness: there are free breastfeeding support groups and online resources but these can be hard to find out about or even know they exist as many are only advertised by flyers in community spaces or word of mouth and new mothers are frequently isolated at home in the early days and weeks
- Location: depending on the time of day a person gives birth, the hospital they are in and length of time they spend on the post-natal ward, they may be able to see a volunteer lactation consultant. Once out of hospital, some areas have free or donation-based breastfeeding support groups run by a lactation consultant. But often it is hard to leave the house after giving birth, and even if they are lucky enough to have a support group near them, the lack of advertising ensures that many new mothers aren’t aware of the opportunity
- Time: the majority of these services are not available in the middle of the night when many new mothers need them most
If you are lucky enough to access support, it varies according to the lactation consultant you speak to and any demonstrations will be done over the phone with no visual aid or in-person / online with a knitted breast. That’s right. A knitted breast…
It is clear that the breastfeeding market is in dire need of innovation, which creates huge opportunity — so let’s dive in.
The market
On average, parents will spend £1000 preparing for the birth of their child, and then around £6000 in the first year of their child’s life. With approximately 650,000 babies being born in the UK every year, that’s around £4.5B being spent every year.
The breastfeeding market itself was valued at $2.22B in 2021 and is predicted to be worth $3.2B by 2028. Demand is expected to increase in alignment with the increase in birth rates post-pandemic. It consists of four main sectors.
The Takeaway: 4 things you need to do to milk the breastfeeding boom
1. The Data Desert
There is scant research and data collection around breastmilk nutrition which leaves potentially profitable questions unanswered. In an interview for this article, Omar Daniel, Co-Founder and Partner at health and biotech venture and accelerator Harbr, recently highlighted the following:
- The is a link between maternal nutrition, breastmilk nutrition and better baby sleep (FYI the baby sleep market is valued at $325M). Better baby sleep = better parent sleep, and better parent sleep = better relationship, increased productivity, happier parents, etc
- There is already an established link between breastfeeding and higher IQ, so we need to learn more as this could have implications for formula companies and governments
- What vitamin and mineral supplements actually boost breastmilk production. There is anecdotal evidence about oats, probiotics and Brewer’s Yeast but we are yet to see in-depth analysis and proof of how they affect the nutritional profile and milk volume
- Inform formula companies on how to make their formula even more “human” and therefore baby-friendly
- Take formula up a level by synthesising human breastmilk so that it is tailored to time of day and each stage of a baby’s development
- Discover what else don’t we don’t yet know about breast milk, baby nutrition, population health and more
Although these may sound like benevolent causes, there are many examples of R&D startups being acquired by pharmaceutical companies.
2. Be contrarian
When it comes to investing in breastfeeding tech, there is a (somewhat understandable) bias towards investing in a company that disrupts an established product. We see this in Elvie and Willow with their silent portable breast pumps. I get it, it’s an established innovation and investment practice: ‘we know that people need it; now let’s give them that thing but way better’.
But what about inventions? Products and services that don’t just disrupt an established product or service, but instead disrupt the entire market and birth supplementary markets around them.
Coroflo and MyMilk are two great examples of just that.
MyLee from MyMilk is a hand held device that gives mothers access to real time data on the nutrition of their milk, what stage they are at in the transition from colostrum to milk and can then give guidance on next actions mothers can take to improve supply or nurition. And remember all those data questions above? Well, they could answer all of them.
Coroflo is a smart nippleshield that measures how much milk the baby takes during a feed. Currently the only way to know how much milk a baby takes is to weigh them before and after which isn’t accurate and doesn’t take into account the efficiency of their latch and feeding. It also doesn’t give data on baby feeding patterns throughout the day. Does a longer feed mean that the baby is taking more milk or are they actually less hungry and therefore feeding less urgently? Going back to the data, does taking more milk in a bedtime feed mean they’re sleeping longer? Or are they so tired at bedtime, they hardly feed at all and that’s why they’re waking up 2 hours after they’re put down.
Your portco could be the one that disrupts the entire breastfeeding market, not just a small sector.
3. Market Persona
Although we tend to think that the breastfeeding market is all about established feeding, the greatest opportunity is, in fact, with the 47% of mothers who start breastfeeding but don’t continue to 6 months. The majority of this group will be stopping because they have encountered problems and are underserved by the current products and services available. New products and services should seek to serve this sector.
Going deeper, the mindset of the women and partners who are potential customers is very different to that of the average customer. When it’s 3am, your baby is screaming, your nipples are bleeding and you’ve only had an hour’s sleep but your baby isn’t putting on weight and you want to establish a good supply of milk so you must keep feeding them, you will do literally anything to solve the problem.
Traction: In the first month of a baby’s life, mothers spend 6–8 hours a day feeding their baby. (Yes it’s equivalent to a full time job and thats before you even get started on the other things you need to do in the day). What you can do during that time is limited to one handed/no handed activities such as Netflix, scrolling through social media and conversations with friends. The latter two are what we need to focus on.
- Social media- there is a captive audience looking for solutions, companies should look to capitalise on this with a large proportion of their marketing spent on social media and digital marketing.
- Word of mouth- LactApp cornered 23% of the market in Spain with zero marketing spend.
4. Have the right team and processes in place
Hire more mothers into senior roles at VC funds. Ensure you have flexible working agreements in place and advertise them in the job description. Don’t wait until the first woman at the fund gets pregnant before you have a maternity policy in place- be proactive, think it through and be vocal about it. You never know what brilliant talent you could attract who would have gone elsewere. It isn’t enough to have one or two women, or many women in junior roles - we need diversity of thought, background and insight as well as diversity of gender at the decision-making level.
Actively seek out female founders, run a monthly or quarterly pitch morning and widen your femtrepreneur network.
And finally, get comfortable talking about boobs, nipples, mastitis, milk and all things female body-related. 💃
👋 Thanks for making it to the end of this article! When I’m not obsessing over FemTech, I’m using my accredited executive coaching and mediation skills to help pre-series B founders create high performing teams 💪
I’ve just completed an eight month venture capital fellowship with Included VC and my inbox is always open for anyone who wants to chat about pitching, decks, company culture, productivity, female founders and anything communication related. Come and say hi on LinkedIn 🙋🏻♀️
Thank you to Omar and MyMilk for your insights and to the INVC fellows for your support and being brilliant sounding boards in the writing of this article.
Make sure you follow Included VC on Twitter & LinkedIn.
