Ladies’s well being and its startups constructing linked breast pumps, interval trackers, and different apps and {hardware} designed for ladies have collectively pulled in additional than $5 billion in funding within the final 5 years, however the market is tight, and now, two of the trailblazers within the house are coming collectively as consolidation beckons.
Willow, the San Francisco startup that made its title with wearable breast pumps, is buying Elvie, which began with a sensible Kegel coach earlier than increasing to different merchandise for brand spanking new moms, together with its personal breast pumps and most just lately, a bassinet.
Phrases of the deal haven’t been disclosed however we perceive that it’s coming as Elvie enters administration. The London startup raised greater than $186 million over the past 12 years with buyers, together with Octopus Ventures, BlackRock, and Blume Fairness, amongst others. Its final valuation was $241 million, per information from PitchBook.
The businesses have been in dialog for a while, after Willow approached Elvie to purchase it. However as talks progressed, Elvie additionally approached the top of its runway.
“The transaction is taking form after many months of other expectations,” Willow CEO Sarah O’Leary mentioned in an interview.
We perceive Willow is taking up the present enterprise, together with its merchandise and crew. There are at the moment 170 folks working throughout London and Bristol, though a few of these are already understanding their discover durations and received’t be approaching to Willow.
For its half, Willow has raised round $254 million in a mixture of fairness and debt with buyers, together with the likes of NEA and Meritech. Its valuation, per PitchBook, had risen to as a lot as $256 million in 2021 (a excessive watermark for enterprise funding normally) however had dropped in 2024 when the corporate raised a mixture of fairness and debt.
O’Leary, who stepped into the CEO position on the finish of 2023, declined to touch upon its present valuation however mentioned that the corporate could also be trying to increase extra later this 12 months.
Elvie’s tip into chapter 11 speaks to a number of the wider challenges on the earth of ladies’s well being, which is estimated to be a $60 billion market this 12 months however has confronted quite a few headwinds. The market since 2021 has continued to be difficult for later-stage startups, particularly these that aren’t targeted virtually solely on AI. There aren’t loads of exit alternatives for ladies’s well being companies in the intervening time. Plus, as O’Leary factors out, the market (eyeing that $60 billion determine, little question) has been flooded with a plethora of cheaper merchandise.
Cheaper is one downside, however so is the truth that there are only a lot of comparable merchandise out there. Elvie has sued at the very least one firm for patent infringement up to now (unsuccessfully), and curiously it was additionally the topic of a patent go well with itself — filed by Willow. An acquisition places that battle to relaxation.
The current drama with 23andMe additionally highlights a number of the massive points with managing consumer information, particularly well being information, when issues go awry with the enterprise. And that’s maybe much more the case with ladies’s well being and reproductive companies within the present political local weather.
And, as ever, {hardware} — or at the very least the flexibility to show {hardware} startups into worthwhile companies — stays exhausting.
Willow’s hope is that its acquisition of Elvie marks the beginning of some wider consolidation and Willow’s personal efforts to construct out a wider platform: If exit alternatives are few and much between, then make your individual platform and grow to be the consolidator.
Ladies’s well being as a class actually arose over time because it grew to become, due to the cloud, smartphones and improvements in massive information analytics, easier-to-build apps to have interaction with the market, and {hardware} prototypes launched through crowdfunding platforms to gauge client curiosity. These merchandise additionally got here out of a extra empowered demographic demanding tech to assembly their very own wants. Now Willow’s problem — and alternative — will probably be to see if it could convert that into revenue over time.
“We wish to present that femtech merchandise aren’t solely nice tales, however nice companies,” she mentioned.
