Investors are ignoring an enormous subsection of tech as a result of it is thought of “taboo” – even supposing it’s set to be value $1 trillion by 2027.
The FemTech sector consists of all improvements designed to resolve well being points suffered solely, otherwise, or disproportionately by ladies. It covers all the things from well being throughout being pregnant and the menopause, to Alzheimer’s and HIV.
Women make up greater than 50% of the worldwide inhabitants, which implies the goal marketplace for merchandise specializing in their well being is very large. But simply 3.3% of digital well being funding within the U.S. went in the direction of ladies’s well being between 2011 and 2020, in accordance with digital consultancy Rock Health.
And nurturing innovation throughout the feminine well being house does not simply profit ladies.
Research by Women’s Health Access Matters, a nonprofit group centered on funding for girls’s well being analysis, suggests {that a} $300 million funding into bettering feminine well being may generate round $13 billion for the worldwide financial system.
Research by Women’s Health Access Matters suggests {that a} $300 million funding into bettering feminine well being may generate round $13 billion.
De Agostini Picture Library | De Agostini | Getty Images
“The opportunities and the potential for value creation of investing in this area is huge,” Karen Taylor, analysis director of the Centre for Health Solutions at Deloitte advised CNBC.
“So I think if there was some more homework done by some of these investors, they’d understand why this is an area that is ripe for growth and investment.
“They simply did not actually get it”
Tania Boler created Elvie, a tech company focused on women’s health, in 2013 after she found a lack of products designed for new mothers. Elvie’s main products are pelvic floor trainers and portable breast pumps.
But not everybody took her new business seriously.
“To be fully trustworthy, the tech trade thought it was a joke,” Boler told CNBC.
“They simply did not actually get it … [and] in fairly a couple of ladies’s well being points, the issue is that as a result of there is a lack of schooling, there is a lack of demand. From an funding viewpoint it isn’t clear what the thesis is,” Boler said.
Personal understanding of a product is often key for investors, but the stats show that most investment decisions are made by men. A 2022 report by European Women in VC, a collection of senior female venture capitalists, found that just 15% of VC general partners were female.
Despite the barriers, Elvie has gone big. It is now one of the largest companies in the FemTech space and has a revenue of $100 million. There are examples of women who have run marathons and performed surgery while expressing milk using Elvie pumps, which CEO Tania Boler said highlights the human impact of investing in women’s health.
“We went with a really sturdy message of empowerment, however on the similar time we sort out the taboos head-on, we do not draw back from that. And that begins the dialog,” Boler said.
The issue of not understanding women’s health – and the importance of female-specific health solutions – has deeper roots.
“Because it has been such a taboo matter, it is actually laborious to beat,” Valerie Evans, consumer investor at venture capital fund The Craftory, said.
“Not as a result of [investors] do not need to know and never as a result of they’re purposefully ignorant, however I believe it is an total societal downside that type of permeates the investing world.”
And while the number of female investors is limited, the gender balance within company teams can also impact how difficult it is to get backing.
‘Being angry feminists hasn’t worked’
More than 70% of FemTech companies have at least one female founder, compared to the 20% average, according to McKinsey & Company.
But that means the odds are stacked against them.
Less than 3% of venture capitalist funds went to female-led startups in 2020, according to data from business school INSEAD, while female entrepreneurs are 63% less likely to get VC funding than men.
Deloitte’s Taylor said female founders also generally ask investors for less money than their male counterparts, which could be harming their prospects within the space.
“There’s numerous analysis that exhibits ladies are typically rather more trustworthy and play down what they imagine is the potential for his or her innovation,” she said. “Men are infamous for giant gross sales and buyers are used to it.”
Economies will grow when women can birth taxpayers and not die in the process
Brittany Barreto
Founder and CEO of FemHealth Insights
For Brittany Barreto, founder of FemTech analytics platform FemHealth Insights, these figures emphasize the importance of startups taking accurate data to investors — so if they can’t appeal to personal experience (because the VCs are men), they can provide robust information.
“It was crucial that we persist with the information a part of all of this as a result of if we’re simply indignant feminists, that hasn’t labored but. So I used to be like: let’s be scientists and let’s be enterprise folks,” Barreto said.
And the FemTech sector is growing at an astounding rate. More than 60% of FemTech startups were founded in the five years leading to 2022, and there has been a 1,000% increase in the number of businesses in the space over the last 10 years, according to FemHealth Insights research.
These growth rates — despite myriad obstacles — are encouraging for an industry that has been struggling to gain traction.
“I’m extremely optimistic for the way forward for ladies’s well being,” Barreto said, stressing the huge potential benefits for the world.
“The financial potential for international locations if they will empower ladies to really feel higher, to stay longer, stay with extra mobility?” she said. “Women have cash. Economies will develop if we make ladies wholesome.”
Source: www.cnbc.com”