Male Dominated VCs Stifle Growth of Femtechs, Female VCs Say

• Funding for US femtech startups doubled in 2021 to $1.4bn, Rock Health data shows.
• Only 5% of digital health funding last year went to women and health tech companies, according to Rock Health.
• 5 female investors told Insider the lack of senior VC roles for women was slowing the femtech sector.

A lack of women in senior venture capital roles is hampering the growth of femtechs, according to some female investors who say men often overlook opportunities due to a lack of understanding of female health issues.

The market for femtech – which refers to tech products or services which serve women’s health needs including fertility and sexual health –  has been tipped to exceed $60 billion by 2027, according to data from Emergen Research. In August, Maven Clinic became one of the US’s first tech startups valued at over $1 billion dedicated to women’s health.

The problems femtechs try to address are often misunderstood by investors, who are typically male, five female VCs told Insider. A PitchBook report found that 15% of venture capital partners in 2021 were women.

“With so few female check writers, there’s not a massive pool of investors out there who will have first-hand experience,” Christina Farr, an investor at Omers Ventures, said.

“Investors look at numbers and they do due diligence, but there’s also a lot of instinct that isn’t talked about. And it’s human to feel more passion for problems that you’ve lived or experienced. So there just aren’t enough investors out there who have personally felt these problems, or have real reason to fear that they may in the future.”

Funding for US femtech startups doubled in 2021 to $1.4bn, yet only 5% of all

digital health

funding in 2021 went to women’s health tech companies, data from Rock Health shows. By comparison, US startups that raised the most in 2021 include R&D-focused biopharma and medtech ($5.8bn), whilst mental healthcare startups raised $5.1B, according to Rock Health. 

Avestria Ventures partner, Tracy Dooley, said investors typically fund founders that are like them or ideas that are relevant to their lived experience.

“The lack of diversity hampers women’s health funds,” Dooley said. 

“Female founders of women’s health companies are doubly disadvantaged because the broad investor community rarely has expertise in, passion for, or comfort with women’s health,” she added.

Jessica Karr, partner at Coyote Ventures, said the lack of VC funding in women’s health and for female founders is “implicit bias” as “male investors tend to ask female founders about risks while asking male founders about opportunity.”

“Not only are they female founders, but they present to mostly-male investors about topics that often make them uncomfortable. They may be asked to not say the word ‘vagina’ when that is a core part of what they are talking about,” Karr said. 

Goddess Gaia Ventures founder Priya Oberoi claims the lack of funding for femtechs is partly because women’s digital health is “not sexy enough” for most male investors.

“If you compare how much investment goes into Web3 and the metaverse versus women’s health you begin to see how challenging it is for female founders to raise investment from men with zero connection to the problem.”

Healthcare analyst Nicole Wardlaw told Insider that whilst femtechs are a “blind spot” for male investors, some may also be reluctant to invest as the market is still embryonic. 

“Even though some companies in this space have scaled, they still have not reached profitability yet as the sector is still young,” Wardlaw said.

“This in turn means a barrier to entry for other businesses coming through the pipeline seeking funding,” she said, adding that venture capitalists are less likely to take huge risks on young sectors.