Where are the FemTech Companies?
I’ve spent my Labor Day working through multiple email inboxes and addressing outstanding requests. More importantly, I have been reading the newsletters and reports on what is going on in the digital health space.
I am paying close attention to who is funding digital health startups and at which stages so I can continue to build relationships with other digital health investors for the future rounds for my current and future portfolio companies. (Tueo Health, MyHealthTeams, Sandstone Diagnostics, Magnetic Insight)
As I was noting who was funding what, I realized that something was missing.
Where are the FemTech funding announcements?
There have been a few notables this year including Maven and Elvie that have publicly announced their successful fundraising efforts but where are the others?
We are on track to hit $10B in equity funding in digital health startups this year and yet only a handful are in the FemTech space.
In case you are wondering, FemTech (short for feminine technology) is a term coined by Ida Tin, Founder and CEO of Clue. FemTech is digital health for women and includes fertility solutions and monitoring, pregnancy and nursing care, pelvic healthcare, general healthcare, period care and goods, and women’s sexual health and wellness. I haven’t seen the market size numbers for this area but given that this covers over 50% of the population, we can safely say it’s pretty large.
And keep in mind that 80% of household healthcare spend is controlled by women.
So, then, where are the investments in FemTech? Are these companies getting getting access to funding and just not announcing publicly?
My investment interest is now 100% in the FemTech and PediaTech (children’s health) sectors. I’ve met with quite a few founders, mostly women, in the FemTech space trying to raise seed rounds for their startups. These have been in fertility, period care, pelvic health, general healthcare, nursing care, and sexual health and wellness. These companies are out there and they need money but are they getting it? I think they are struggling.
Given that when I talk about FemTech with male investors and they have to ask what it is, I am thinking these FemTech founders are facing an uphill battle. As we know, investors have a tough time investing in something that they can’t directly relate to and when we talk about investing in things that affect ladies and lady parts, we know that some recoil and run away (yep, I could go there but I won’t).
So where does that leave us? It leaves us with a huge investing and market opportunity. Full stop.
But we need to do a better job of making sure that we lure the investors in with dollar signs so that they don’t run away when we start talking about women’s health and bodies in a way that serves women and not men.
Between 2014 and 2016, startups focused on women’s healthcare raised $1B. Digital health start ups raised nearly $7B in 2016 alone. I think there’s some room for improvement here.
If the US healthcare spend is $3T per year (yep, that’s trillion) and we consider that half of the spend is on women, well, you do the math. Although, most of the products and services are not designed for women so it’s anybody’s guess as to what the actual number could be.
Women are no longer simply making do with what is available; we are developing products and services with women and mind and we are voting for these solutions with our considerable spending power.
For those investors with serious FOMO, shouldn’t you be taking a closer look at where the market is moving and where the consumers and businesses are spending their money? If not, you really may miss out on a huge opportunity. But, then, again, that leaves a bigger reward for those of us who are seeing that the time has come.
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