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  • Mary Schreiber Swenson Phd.

Venture Capital, Take Note: $1 Trillion FemTech Industry is the Best Value Investment in Healthcare

Photo: Unsplash

“This is a man’s world,” American crooner James Brown famously sang. “But it would be nothing, nothing without a woman or a girl.”

When it comes to the world of modern healthcare, Brown’s words certainly ring true. A quick glance at the demographic statistics of U.S. healthcare workers proves this in spades: 54.2 percent of all U.S. doctors are female and 86 percent of all nurses are women.

This female-focused sentiment has reverberated deeply into the growing FemTech healthcare sector, a rising force of technological power set to be valued at a massive $1 trillion globally by the year 2027. FemTech is unique from other healthcare technology ventures in that it focuses on directly addressing the health issues experienced by women, ranging from menopause to fertility, cancers to HIV, and everything in between, factors that have sadly been overlooked by the male-dominated corporate world for far too long.

But despite this notable boom in FemTech enterprises and the industry’s noble intentions of serving the needs of half the world’s population, investors have unfortunately repeatedly passed over financing FemTech, even with the potential financial gains laid out clear as day in front of them.

According to digital consultancy Rock Health, only 3.3 percent of healthcare investment between 2011 and 2020 went to FemTech companies – even though female-led startups consistently outperform those of their male counterparts by 12 percent in revenue every year.

Those few investment firms that have bet big on women’s ventures have benefited in a big way; investment firm First Round discovered that its investments in female-founded companies had 63 percent higher performance than its respective investments in male-founded ventures.

Not only are women-founded startups more likely to succeed and generate returns for their investors, but the continued success of the FemTech industry is anticipated to have a major impact on the global economy at large; just a $300 million investment in FemTech could generate $13 billion for the global economy, research from nonprofit Women’s Health Access Matters has shown.

Plenty of the pushback by venture capital stems from the fact that high-level investment firms are overwhelmingly controlled by men, with men comprising more than 90 percent of the sector’s firm partners, venture capitalists, and board seats.

Considering that FemTech is an industry driven directly by women’s experiences, and the fiery passion to fix these gender-specific issues at their roots, it shouldn’t come as a surprise that male investors simply don’t understand the history or background behind certain female-centric enterprises aims, likely off put by gender-divide taboos.

But what male investors and venture capitalists should overwhelmingly understand – as is their job to do – is the clear value of FemTech, one that’s growing exponentially year over year.

“The opportunities and the potential for value creation of investing in this area is huge,” research director of the Centre for Health Solutions at Deloitte Karen Taylor revealed to 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.”

Part of the colossal capital divide is the fact that women founders often play down the value of their business in stark contrast to the finance-driven approach of male founders. But with increased attention to the expanding FemTech sector and the subsequent empowerment of its female founders, perhaps this mentality – along with the necessary change in the gender funding gap – too could change.

As a female FemTech founder myself, I’m keenly aware of the gender issues that have plagued the healthcare sector for decades and am vehemently intent on changing the industry for the better. With MySmileChoices, I am to democratize the international dental sector so that women can feel empowered in the decisions they make to improve their oral health, providing unbridled access and understanding to consumers that’s been missing from the global market.

They say that change starts with the individual, a path I am already passionately following; but if all of us women band together in sisterhood to make a powerful change to the healthcare industry, the sky's the limit for the future of FemTech.

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