The women’s health sector is undergoing a dynamic transformation, fueled by factors such as heightened recognition of women’s distinct health requirements, strides in biotech and telehealth, and a transition towards more adaptable business models. Despite a decline in venture capital support since 2021, the industry is evolving. Yet, it grapples with substantial hurdles, notably limited funding, capturing a mere 2% of the total health-related venture capital investments. Additional challenges include stringent regulations, lack of clinical trial diversity, and the undervaluation of women-led businesses.
To fully realize its potential, the women’s health market requires a multi-faceted approach that includes VC investment, government support, and a focus on data-driven, and personalized care.
Women’s Health Innovation Fueled By Venture Capital
The women’s health market, valued at $41.3 billion in 2023, is poised for significant growth—$66 billion by 2033—despite challenges like restrictive regulations and high treatment costs. Venture capital is key to overcoming these obstacles, fueling innovation by providing funding, guidance, and resources to startups developing solutions for unmet needs. This support accelerates the creation of cutting-edge technologies addressing critical areas like fertility, menopause, and maternal health.
However, the women’s and family’s health sector experienced a steep decline, with investment dropping by over 50% between 2021 and 2024, according to a PitchBook analysis. By December 17, 2024, the women’s and family’s health sector had only garnered $19.52 billion in venture capital investment, falling short of 2019 levels.
This decline disproportionately impacted solely female-founded companies, raising concerns about equitable resource allocation. Despite a slight uptick in 2024 compared to 2023, growing VC support remains crucial to developing comprehensive and personalized healthcare solutions for women.
The 2025 U.S. venture outlook offers some optimism, with 2024 exits (including Agile Therapeutics and Gynesonics) and projected M&A and IPO activity to boost reinvestment in the sector. This positive trend, coupled with strategic VC support, will be essential to driving innovation and addressing the evolving healthcare needs of women worldwide.
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 federal and state levels, [But] the sector’s resilience post-Dobbs, where companies successfully adapted their services and saw increased demand, proves that regulatory constraints can compel creativity and innovation,” explains Lux Capital general partner Deena Shakir in Fortune.
Rather than deterring investors, recent challenges have spurred greater interest and capital deployment into the sector. Dedicated funds have emerged, signaling a focused commitment to women’s health, and unicorn success stories like Maven validate market opportunity and impact potential.
Yet, there has been a far more dramatic decrease in VC investment in women’s and family’s health than the overall sector since 2021, the high water mark. Still, the investment landscape for women’s health has transformed over the past five years, transitioning from a niche sector to a recognized and promising market. This shift is driven by several factors, including:
- Attention from the Biden administration, with $1 billion investment in women’s health research.
- Increased awareness and understanding of women’s unique healthcare needs.
- A growing demand for innovative solutions tailored to women’s health.
- The emergence of more data-driven and clinically-focused approaches to women’s health.
Naseem Sayani, a seasoned VC investor in women’s health and an operating partner at How Women Invest, attributes this evolution to several factors:
- The focus is shifting from B2C solutions to more scalable B2B and B2B2C models, allowing better integration with providers and payers.
- Significant advancements in biotech are addressing critical areas like ovarian health and cancer diagnostics, offering the potential for improved longevity and earlier intervention.
- Telehealth and remote care solutions are expanding access to care, particularly in underserved areas with limited healthcare options.
To further accelerate progress in women’s health, there is a critical need for increased investment in clinical trials, and research focused on women’s health issues. Both government and private funding are essential to ensure that these trials have adequate resources and that they include diverse representation to address the unique healthcare needs of different populations, commented Sayani.
In addition to traditional VC funding, grants, and non-dilutive capital are vital in supporting early-stage women’s health startups and fostering innovation. These funding mechanisms provide crucial resources without requiring founders to give up equity, allowing them to focus on developing solutions and achieving product-market fit.
Sayani cites several factors can contribute to increased funding in the women’s health space:
- Mergers, acquisitions, and IPOs demonstrate the potential for financial returns in the sector, attracting more investors and signaling the viability of women’s health businesses.
- Emerging technologies like AI offer significant opportunities for innovation in diagnostics, care delivery, and personalized medicine, attracting investment in companies developing these solutions.
- Regulatory and policy changes, such as adjusting reimbursement codes and streamlining AI regulation, can 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 OB/GYN care has hindered the effective identification and management of moderate and high-risk pregnancies. Outdated screening and limited genetic testing contribute to missed diagnoses and delayed care, while a lack of personalized medicine and insufficient pre- and post-natal care leave specific needs unmet. This resulted in higher mortality rates and increased preterm birth risks, especially in marginalized communities.
Founders often start companies to solve the problems they experience. Anu Sharma, founder and CEO of Millie—a hybrid women’s health company focused on maternal health—experienced six rounds of fertility treatments, gestational hypertension, an unplanned C-section, and postpartum preclampsia. Her pregnancy journey and the lack of adequate postpartum care inspired her to start Millie.
Sharma comes from a family of physicians, has worked in healthcare for over 20 years, and understands the care model innovation.
She believes that successful exits—mergers and acquisitions and IPOs—are important to the women’s health sector because they will encourage more investors to invest in women’s health companies. “It’s important for investors to see across the venture ecosystem that this category can create winners,” she explained. “It’s a signaling effect.” A supportive ecosystem is needed for the women’s health sector to thrive, including government funding and traditional venture capital funding.
A multi-stage fund that invests in healthcare and has incubated many unicorns doesn’t have a women’s health company in its portfolio. VCs there told Sharma that they don’t invest in women’s health because they are not sure the space can hold enough companies that will go on to be unicorns.
Female-founded companies are undervalued. Sharma commented that not enough investors compete to invest in women’s health to drive up valuations.
The women’s health sector is poised for significant growth and transformation, driven by increasing awareness, technological advancements, and a growing demand for personalized care. Strategic VC investment, coupled with supportive policies and a focus on data-driven innovation, will be essential to unlocking women’s health’s full potential and improving women’s well-being worldwide.