Thirty years ago, the Food and Drug Administration didn’t even allow women to participate in clinical trials. The healthcare industry has come a long way since then, but women’s health still remains a critically under-funded and under-researched segment of the sector.
Recently, Pitchbook data revealed investment dollars were flocking towards women’s health. One venture capitalist isn’t surprised. In a recent interview, Francesca de Quesada Covey, chief investment officer at investment firm TheVentureCity, said she believes women’s health will come into its own in the next few years.
Healthcare startups raised $25.9 billion in 2022, which is 57% less than 2021’s record high of $59.7 billion. But women’s healthcare technology companies, commonly referred to as “femtech,” were more successful in their fundraising efforts than the overall industry.
Pitchbook’s data showed that femtech’s share of healthcare tech funding has been growing in recent years. Femtech startups made up 13.26% of healthcare technology funding last year, up from 8.75% in 2021 and 7.6% in 2020. However, there are unexplainable regional blips involving funding women’s heath.
“Based on current estimates, we think that the femtech market size ranges between $500 million to $1 billion,” de Quesada Covey said. “Even in this new downturn where we’re seeing valuations decrease, we’re not seeing that in the femtech side.”
There are a few reasons for femtech’s budding success. For instance, more women have entered the venture capital industry, and more attention has been drawn to women’s health issues in popular media, according to a recent Pitchbook report.
De Quesada Covey pointed to another important factor. As women navigate a post-Roe V. Wade country, many feel they need to “take healthcare into their own hands and advocate for themselves in ways that the traditional healthcare system doesn’t allow,” she said.
Tech-enabled startups like Tia or Grace Health are specifically tailored to women, allowing them to feel more empowered during the healthcare journey. De Quesada Covey thinks companies like these are bound to gain more users and investors.
She said startups focused on improving care delivery will probably have the easiest time raising funds of all the companies in the femtech space.
For example, TheVentureCity recently invested in Paloma Health — a startup focused on hypothyroidism, a condition that mostly affects women. There is a massive shortage of endocrinologists in the U.S., so the company helps connect women with this condition to the care providers they need. The firm also recently poured capital into Tiny Health, which offers at-home tests to assess mothers’ and babies’ gut health to prevent chronic health issues.
Photo: Drazen Zigic, Getty Images