The women’s health sector is undergoing a dynamic transformation driven by factors such as increased awareness of women’s unique health requirements, advances in biotechnology and telemedicine, and a shift to more adaptive business models. Despite the decline in venture capital backing since 2021, the industry is evolving. But the company faces major hurdles, especially with limited funding, attracting only 2% of total health-related venture capital investment. Further challenges include strict regulations, lack of diversity in clinical trials, and underrepresentation of women-led businesses.
For the women’s health market to reach its full potential, it will require a multifaceted approach, including venture capital investment, government support, and a focus on data-driven, personalized care.
Women’s health innovation promoted by venture capital
The women’s health market, valued at $41.3 billion in 2023, is expected to grow significantly to reach $66 billion by 2033, despite challenges such as restrictive regulations and high treatment costs . Venture capital is key to overcoming these obstacles and fosters innovation by providing funding, guidance, and resources to startups developing solutions to unmet needs. This support will accelerate the development of cutting-edge technologies that address critical areas such as fertility, menopause and maternal health.
However, the women’s and family health sector experienced a sharp decline, with investment declining by more than 50% from 2021 to 2024, according to PitchBook analysis. By December 17, 2024, the women’s and family health sector had attracted only $19.52 billion in venture capital investment, falling short of 2019 levels.
This decline disproportionately affected only women-founded businesses, raising concerns about the equitable distribution of resources. Although there was a slight increase in 2024 compared to 2023, increased VC support remains critical to developing comprehensive and personalized healthcare solutions for women.
The outlook for U.S. venture in 2025 is somewhat optimistic, with exits expected in 2024 (including Agile Therapeutics and Guinesonics) and M&A and IPO activity expected to drive reinvestment into the sector. Masu. This positive trend, coupled with strategic VC support, will be essential to driving innovation and addressing the evolving healthcare needs of women around the world.
The evolution of VC investment in women’s health
“The women’s health market in 2025 will likely continue to face complex challenges shaped by political dynamics at both the federal and state levels, (but) as companies successfully adapt their services and demand increases The sector’s resilience post-Dobbs is proof that regulatory constraints can “force creativity and innovation,” Dina Shakir, general partner at Lux Capital, said in Fortune magazine. I’m explaining.
Rather than deter investors, recent challenges are driving further interest and capital into the sector. Dedicated funds are emerging, demonstrating a focused commitment to women’s health, and unicorn success stories like Maven are validating the market opportunity and impact potential.
However, since its high point in 2021, VC investment in women and family health has declined more significantly than the sector as a whole. Still, the investment landscape for women’s health has changed over the past five years, moving from a niche field to a recognized and promising market. This change is caused by several factors, including:
The Biden administration is paying attention as it invests $1 billion in women’s health research. Increasing awareness and understanding of women’s unique health care needs. There is a growing demand for innovative solutions tailored to women’s health. The emergence of a more data-driven and clinically focused approach to women’s health.
Naseem Sayani, an experienced women’s health VC investor and managing partner of How Women Invest, attributes this evolution to several factors.
The focus is shifting from B2C solutions to more scalable B2B and B2B2C models, allowing for better integration with providers and payers. Significant advances in biotechnology are addressing important areas such as ovarian health and cancer diagnosis, offering increased longevity and the potential for early intervention. Telemedicine and telemedicine solutions are expanding access to healthcare, especially in underserved areas where healthcare options are limited.
To further accelerate progress in women’s health, increased investment in clinical trials and research focused on women’s health issues is essential. Both government and private funding are essential to ensure these trials are adequately resourced and include diverse representation to address the unique medical needs of different populations. Sayani commented.
In addition to traditional VC funding, grant, non-dilutive capital is essential to support early-stage women’s health startups and foster innovation. These funding mechanisms provide founders with critical resources without giving up equity, allowing them to focus on developing their solution and achieving product-market fit.
Sayani points to several factors that could contribute to increased funding in women’s health.
Mergers, acquisitions and IPOs have demonstrated the potential for financial gains in this sector, attracting more investors and demonstrating the viability of the women’s health business. Emerging technologies such as AI offer significant opportunities for innovation in diagnostics, care delivery, and personalized medicine, and are attracting investment in companies developing these solutions. Regulatory and policy changes, such as adjusting reimbursement rules and streamlining AI regulations, could create a more favorable environment for investment and innovation in women’s health.
Women’s health innovation needs more VC investment
For the past 75 years, a lack of innovation in obstetric and gynecological care has impeded the effective identification and management of moderate and high-risk pregnancies. Outdated screening and limited genetic testing contribute to missed diagnoses and delays in care, while a lack of personalized medicine and inadequate prenatal and postnatal care leave certain needs unmet. I am. As a result, mortality rates increased and the risk of premature birth increased, especially in marginalized communities.
Founders often start companies to solve problems they experience. Anu Sharma, founder and CEO of Millie, a hybrid women’s health company focused on maternal health, has gone through six infertility treatments, gestational hypertension, an unplanned C-section, and postpartum preeclampsia . Her pregnancy and lack of proper postnatal care inspired her to start Millie.
Sharma comes from a family of physicians and has worked in the healthcare industry for over 20 years and understands innovation in care models.
She believes successful exits, such as mergers and acquisitions and IPOs, are important to the women’s health sector because they encourage more investors to invest in women’s health companies. “It’s important for investors to understand across the venture ecosystem that this category has the potential to produce winners,” she explained. “It’s a signaling effect.” For the women’s health field to grow, it needs a supportive ecosystem, including funding from government and traditional venture capital.
The multi-stage fund, which invests in health care and has developed many unicorn companies, does not have women’s health companies in its portfolio. Venture capitalists there told Sharma they wouldn’t invest in women’s health because they weren’t sure if the space could accommodate enough unicorn companies.
Women-founded businesses are underrepresented. Sharma commented that not enough investors are competing to invest in women’s health to boost valuations.
The women’s health field is poised for significant growth and transformation due to increased awareness, technological advancements, and increasing demand for personalized care. Strategic VC investments and a focus on supportive policies and data-driven innovation are essential to unlocking the full potential of women’s health and improving the well-being of women around the world.