FemTech: The rise of female health innovation
Silicon Valley Bank, Zinc.vc and The Up Group recently hosted a breakfast on ‘Female Health Innovation’, often known as FemTech. The event brought together the ecosystem of founders, investors, scaled organisations and advisors and was chaired by Nooman Haque, MD at Silicon Valley Bank.
The discussion was diverse, covering the reality of the market segment, the link between physical and mental health, and how B2C models are slowly forcing the big health authorities in the UK and US to change. CVC’s recent acquisition of the women’s health division of the Israeli drug developer Teva for $800m created a company dedicated to contraception, fertility, menopause and osteoporosis.
Opening the discussion, it was clear this is an underserved segment. Recent analysis from Frost and Sullivan shows this market to be worth up to $50bn by 2025. This is driven by the fact that 90% of primary healthcare decisions are made by women. Women are also 75% more likely to use digital tools for their healthcare and spend 29% more per capita on healthcare compared to men.
Reaction of Health Authorities – There is a perfect storm for FemTech to emerge now. Firstly, national health organisations around the world have less money to spend than ever before. Therefore some of the solutions which involved long term low cost solutions are being looked at closely to reduce these costs which would otherwise be absorbed. Secondly, direct to consumer wellness is forcing health organisations to look at how they respond to and leverage these types of innovation. Finally the combination of female founders, ‘Women making products for Women’ and a period of sustained innovation in connectivity, data and hardware has meant more products coming to market and getting funding to begin their growth journey.
The link between physical and mental health – Many of the attendees stressed that when women experience physical health problems, there are almost always mental problems that link to that also. Whether that be loss of confidence, relationship or sexual problems. The long term impact of this can be far greater than the treatment of the physical symptoms. This has also meant the ability to attract talent and resource to this group of companies has been easier given how purpose driven many of these organisations are.
Most health businesses are really tech businesses – Many of the founders in the room immediately looked to find a Co-founder who would be the CTO or Head of Product from day one. The challenge in the room is that you have to be really careful on making recommendations about health unless you are very, very, very sure of your data. There is not a clear line between what would be B2C wellness and what would count as a health care product and therefore be subject to approval by the likes of the FCA. Unlike quicker pizza delivery or improved download speeds, getting health data wrong means more than cold pizza and buffering.
The group will continue to meet and create the ecosystem in a segment which is attracting more investor attention and can solve problems in an historically underserved market.
A huge thank you for Silicon Valley Bank for hosting the event, and to all those who attended for such an open and insightful discussion: