Emerging Markets: FemTech

Rhia Lyon, 2022

Please note interviews were conducted before Roe v Wade was overturned. 

First things first: what the heck is femtech? Well, the clue’s in the name – it’s simply female-focussed healthcare technology, covering any conceivable health-related topic that could arise during a woman’s lifetime. Breastfeeding? Check. Menopause? Absolutely. Periods? Ditto. What type of wine to drink with dinner tonight? No actually, but you catch our drift. 

At its core, it’s a subset of health-tech, and “there are a hundred ways you can splice and dice that term,” says Haley Bavasi, of counsel at Wilson Sonsini. “To me, the unifying theme is that companies bring together technology and health and wellness.”

Helen Reeves, corporate and securities partner at Gunderson Dettmer, thinks: “Some businesses target women in the digital health space, while some target women through tech-adjacent but not tech-enabled means. Whether that solution is enabled through light or heavy technology use, the principal goal is to support women’s health needs and make our lives easier.”

"'Femtech' can make these needs sound niche, when they aren't. And there are specific health concerns that aren't exclusive [to cis women]." [Kathleen Mon]

The term ‘femtech’ was coined in 2016 by Danish entrepreneur Ida Tin, who founded period and fertility-tracking app, Clue. On the whole, there are four broad categories that fall under femtech: general health and wellness; pregnancy and family care; reproductive health; and healthcare diagnostics. The term was created to bring attention to women’s issues in the traditionally male-dominated healthcare system, but it is an imperfect term, as Kathleen Mon, head of in-house at legal recruiting agency Whistler Partners, acknowledges. “’Femtech’ can make these needs sound niche, when they aren’t. And there are specific health concerns that aren’t exclusive [to cis women]. Anyone who was born female, whether they identify as female or not, will have similar health concerns. When we’ve worked with start-ups in this space, we’ve let their founders guide us on terminology; if they find the term ‘femtech’ useful, or if they prefer broader terms like ‘health-tech.’” 

Additionally, there’s some debate over whether the term should be applied to technologies that address fertility and family-planning. Take the Maven Clinic, for example. The virtual clinic focuses on women and family health, but acknowledges that a lot of those issues can affect cis men, trans men and non-binary people too. The company’s GC and corporate secretary Erica Pham tells us, “at our core, we’re trying to provide care and community to help people in their journey as parents.”

Quarantine Period

Regardless of what you call them, femtech products, like so many other tech products, have really found their footing during the pandemic. Feminine hygiene company Thinx was the first brand to introduce reusable underwear for menstruation and incontinence. “When they brought these out in 2014, lots of people thought women wouldn’t want to wear the same thing all day and that frankly it was a bit gross,” says Reeves. "But now you see many companies in the reusable underwear space because there’s a huge market need, it’s environmentally friendly and there’s far less stigma around these kinds of products.” When the pandemic hit, people started giving these products a go instead of making a potentially dangerous trip to the shops. Although these products aren’t digital, and may not fit neatly into what VC investors traditionally saw as ‘health-tech,’ the material is a patented technology that provides a solution to an everyday problem. 

In another example, Reeves tells us about her personal experience after giving birth during the pandemic. “I was looking for breastfeeding support but it was difficult to get an in-person consultation,” she explains. “Luckily I found a company that has lactation consultants available to observe you feeding virtually, and give you techniques to help with that. That’s an example of a company that isn’t a heavy technology business, but uses tech to provide a solution that some women need.”

This is certainly something that the team at Maven recognized. “Women and their families were really isolated during the pandemic, but we were in the unique position of providing them access to care teams in an incredibly convenient way,” explains Pham. Working across the pregnancy and family care umbrella, Maven doesn’t aim to replace traditional healthcare models, but rather augment the services that already exist. Say a woman is pregnant. She will still do her scans with her OBGYN, but she probably won’t be able to contact her physician whenever she wants. For example, if she’s worried about something with her pregnancy but it’s the middle of night, she can speak to a Maven care advocate right away. 

“Lots of healthcare companies that didn’t touch health-tech before the pandemic are now very much ensconced in it." [Emily Witt]

The pandemic as a whole fuelled this revolution. “Lots of healthcare companies that didn’t touch health-tech before the pandemic are now very much ensconced in it because almost everything physician-related is now available online,” says Emily Witt, managing director at Whistler. “There is no avoiding this reality for healthcare companies that want to continue to succeed.” 

This has also resulted in unprecedented funding for the health-tech industry. Before the pandemic, companies were averse to adopting telehealth because they couldn’t claim reimbursement for offering remote services – not to mention the reams of licensure laws. Lower-value companies faced additional limitations (e.g. they typically can’t practice across state lines), meaning third parties had to be convinced to cover these services. 

But once the pandemic hit, there was an urgent need for regulations to be changed on an emergency basis to permit the use of telemedicine day to day: “It’s now completely feasible to offer health through tech and to be reimbursed for it. There’s no getting that cat back in the box!” according Bavasi. 

"It’s still much more difficult for women to get funding compared to men, and the figures are even more abysmal when it comes to women of color, but this is something different venture funds are laser focussed on." [Helen Ogbara Reeves]

Nonetheless, there’s room to grow: of the $32 billion invested in US health-tech in 2021, just $1.2 billion was spent on FemTech. As Reeves notes, “It’s still much more difficult for women to get funding compared to men, and the figures are even more abysmal when it comes to women of color, but this is something different venture funds are laser focussed on. There are also high profile individuals who are looking for ways to make investment returns and also support diversity in tech, so funding women-led start ups just makes logical sense.”

Maven, for example, is the first US women and family-focussed health company to have achieved unicorn status, with A-lister backers like Oprah, Natalie Portman and Mindy Kaling to its name. L’Oréal even offers access to Maven as an employee benefit. “Investing in this space is a no brainer,” believes Witt.

Cross-Fertilization

If you like what you’ve read so far, you may be wondering what kinds of attorneys end up working with femtech companies. It varies, according to Witt. She’s recruited everyone from M&A lawyers who want a more generalist corporate role to litigators who have regulatory experience. “While experience with health-tech clients can’t hurt, the variety of these products means that there is no single ideal candidate. And you don’t need to be a woman, either! I’ve worked with men who are interested in these issues. This industry doesn’t discriminate.” 

Bavasi points out that “this is an emerging market so it’s a tricky legal field to navigate. There isn’t a boilerplate for these issues.” There’s the issue of dealing with 50 different state laws, for one. But of course, femtech companies face the same issues as all other businesses. This is especially true in the start-up phase: raising capital, going public and physically finding somewhere to work from are homogenous challenges across early-stage companies. As Bavasi put it, “it takes a village to best advise these companies.” IP and corporate issues are especially common: tech transactions folks provide start-up advice, whilst patent attorneys are crucial to ensure these companies’ algorithmic and tech solution software is protected. “Where these companies are in their lifecycle will determine which practice area takes the lead,” says Bavasi. 

At Wilson Sonsini, she says corporate is the driving practice, with speciality groups – privacy and data strategy, technology licensing, IP and health regulatory – all providing support. Privacy is one sector that’s almost guaranteed to come up. “So many companies are driven by collecting and processing data, which implicates a number of privacy and data use issues,” Bavasi continues. “Whether you’re looking at a contract with an employer or working with a direct-to-consumer platform, it always comes back to privacy.” 

Regulatory issues are naturally very common as well. “These companies need FDA approval for their products, which includes any claims you’re making about your product. For example, how much blood do you say this product can hold? If someone turns around and says ‘I wore your product for the amount of time you said I could wear it and it leaked,’ they can come after you.” 

The loosening of some regulations during the pandemic has also helped e-commerce pharmacies, like the online contraceptive start-up Wisp, reach more customers. “Consumers now expect to be able to see a doctor and fill a prescription through a single platform, and traditional pharmacies are having to adjust,” says Witt. The pandemic also introduced new issues for the insurance business too. “Insurance companies have come to accept that they have to reimburse doctors for online consultations, so they’re now concerned with health-tech in a way they weren’t before.”

Advertising law can come to the fore in other ways. Things got a bit dicey for Thinx back in 2015, when Outfront Media (the advertising contractor for New York’s Metropolitan Transit Authority), raised concerns that Thinx’s use of a grapefruit to depict, er, lady parts on the New York subway was inappropriate, even though there were existing ads featuring grapefruits advertising breast augmentation already in place on the subway. Public outcry on social media meant Thinx’s campaign was allowed to go ahead. 

“I’ve had to learn areas of law that I had very little experience in, be it securities or employment law. But that’s what makes this field so interesting; you’re constantly trying to figure out new pieces to the puzzle, which is really exciting." [Erica Pham]

As Pham tells us, “I’ve had to learn areas of law that I had very little experience in, be it securities or employment law. But that’s what makes this field so interesting; you’re constantly trying to figure out new pieces to the puzzle, which is really exciting.”

Route(r)

With no template for the ideal attorney, the routes in are extremely flexible. Whistler recommends that people interested in femtech start out by building a broader tech or health-tech practice and build a base of femtech clients from there. Finding a mentor with femtech clients is key, but it’s important to note that most attorneys won’t have a specific femtech practice; instead, they will typically focus on digital health more broadly and serve femtech clients as part of their practice. 

As a corporate and securities partner at Gunderson, Reeves tells us "I wouldn't say I set out to build a practice solely focussed on women or on people of color, it's been more of an organic process.” Reeves primarily works with early-stage entrepreneurs: "For me, the most fulfilling part of my practice is seeing women founders become so successful that they're able to scale and eventually sell their companies. Women are changing the face of tech and it’s truly exciting to be a part of that."

"Traditionally, it’s not been easy for female entrepreneurs to break into this world, but I’m now seeing extremely capable entrepreneurs finding ways to break those ceilings by offering products and services that there is clearly a market for." [Haley Bavasi]

All of Bavasi’s clients are early to mid-stage companies that operate in the digital health space, with around 15% of those clients focussed on women-related health specifically: “The representation of women-led, women-focussed companies in the health sector is growing.” Bavasi has also noticed an evolution of women-led initiatives: “Traditionally, it’s not been easy for female entrepreneurs to break into this world, but I’m now seeing extremely capable entrepreneurs finding ways to break those ceilings by offering products and services that there is clearly a market for.”  

Reflecting on her own way into the industry, she tells us “there was a lot of change happening in the health industry around the time I decided to become a lawyer, with the emergence of smartphones, the Affordable Healthcare Act and an ageing population.” After law school, she wanted to join a Silicon Valley start-up, “but I soon realized health-tech hadn’t yet become an established industry, so I decided to get my education in healthcare regulatory law in a BigLaw firm with a leading health practice. From there, I joined Wilson’s technology transactions biology group and whilst I’ve been here, our digital health practice has evolved into what it is today.”  

As for Pham, she started out at Dentons before joining the Obama administration to help implement the Affordable Care Act. “Being able to support over 14 million people who were newly eligible for health insurance was a remarkable experience,” she tells us. “I really wanted to see how the ACA was being implemented on the business side, so I spent some time working for different companies.” And why join a start-up like Maven? “When you’re working in a large firm, you’re a little removed from the ultimate mission of impacting the health of women, one woman at a time. At Maven, I can see the day-to-day impact of solutions and the results are tangible.” 

Interviews were conducted before Roe v Wade was overturned. After the decision, our interviewees commented:

Helen Ogabra Reeves: “In light of the Dobbs decision, the data privacy issues for femtech companies – regardless of whether the product uses light or heavy technology – raise serious alarms that benefit from immediate attention.”

Erica Pham: "The post-Roe legal landscape is complicated and there is a lot that is uncertain. My team at Maven has been working diligently to understand the evolving landscape to ensure that we are operating in accordance with state regulations while protecting and supporting our members, employees, providers and clients. Those two principles are most important to us and are guiding our approach during this unprecedented time."