The pandemic – as much as we’re all bored of talking about it – has a lot to answer for when it comes to how it has shaped life today. One of the silver linings in our view is the acceleration of consumer awareness of all things ‘Health’. The timing for this massive societal epiphany was ideal, in some ways, given the exciting long-term structural tailwinds in the healthcare space, spanning scientific research, technology, falling costs of hardware and the rise of artificial intelligence and machine learning.
At True, we’re keenly watching the transformation of the sector for the next breakthrough companies in Consumer HealthTech. So here are the six big trends we’re seeing in the space:
Trend One: Decentralisation
Covid lockdowns forced experimentation with decentralised health care; from online GP consultations to at-home testing and your weekly Zumba class over Zoom. Many thought people wouldn’t adapt or that it wouldn’t last, but we believe the worldwide ‘trial’ of digital/at-home solutions combined with the increasingly overburdened public health infrastructure will continue to drive a fundamental change in consumer and business behaviour.
Telehealth, for instance, saw an exponential increase, with McKinsey reporting an increase of 38x between February 2020 and July 2021 and is forecast to continue to grow at 28% year on year. Off the back of this, one of our portfolio companies, mental health and mindfulness platform Unmind, which supports enterprises to improve the well-being and mental health of employees, have recently launched ‘Unmind Talk’. This new service provides subscribers – both employers and employees – access to a global network of accredited mental health providers.
For many, especially Millennials and Gen Zs, decentralisation has decreased barriers and can lead to a healthier population. Take the teen health app Luna, which enables teens to ask for anonymous health advice, as well as Finch, the self-care app with a fictional companion, and Spoke which taps into the Gen Z zeitgeist by using music and artists to foster mindfulness.
From a business perspective, decentralisation has the potential to aid growth, scalability and profitability as brands are able to reach a larger audience at a lower cost. The need for physical locations is lessening which is impacting both the bottom line and audience reach.
Trend Two: Personalisation
We all have unique, personal requirements to keep our bodies at peak health, whether that’s personal training sessions or the different vitamins we need to take to supplement our diet. Pre-pandemic there were already substantial markets in personal training, nutrition and supplements, but the use of data and tech is making nutrition and training even more personalised.
Take our investment in VITL, for example, a company that provides tailor-made supplements and at-home nutrition tests. Zoë and Feed Me Seymour are similarly changing the nutrition space by helping consumers make healthier choices for their individual needs. On the exercise side, Kollektiv aims to bring the knowledge of personal training for professional athletes to everyday consumers.
Personalisation is developing fast and there are new possibilities driven by scientific understanding appearing every day. Not only is medical testing – from genome sequencing to microbiome testing – getting better, cheaper and simpler, but consumer technologies are also developing, for example applying data from hardware and wearables that people can track from home.
Trend Three: Quantification
A related but separate trend is quantification. We’ve seen an explosion in consumers collecting data via wearables or apps, or even at-home testing kits to help drive towards specific health, fitness and wellbeing goals. Armed with quantifiable data about their bodies, consumers can enact behavioural changes built upon tech-driven recommendations.
We have seen several exciting startups in this space across multiple verticals. Take Hello Inside, Hertility and Hormona, all of which help women track and better understand their hormones and fertility, or Arion which has developed smart insoles to help runners find the perfect shoe, reduce injury, and optimise performance.
Trend Four: Socialisation
Sometimes we all need a little nudge, and making changes with friends – or even strangers – can make a big difference for motivation. The ability to have real-time or asynchronous connection with others to reach fitness goals was a lifeline for many during the pandemic - Strava saw an increase of 20 million users in 2021 alone – and community remains a strong trend.
Social connections around health and well-being are most effective when they focus on specific moments and needs. Our investment in Peanut, an online community for women throughout all stages of womanhood, was inspired by their mission to build a safe online environment for an all-female community to connect for support and advice.
Other examples in the socialisation category include Fitafy, an app for people embracing a healthier lifestyle to connect for romance and friendship. Addiction recovery is another interesting use case for community-driven engagement, with products such as Sober Sidekick’s peer-to-peer support network for those recovering from addiction.
Gamification – and the friendly competition that comes with it – is a large part of the socialisation trend. Our growth equity investment in Zwift is an excellent example, alongside our early stage in investment Brawn, a software and content platform that connects strength training enthusiasts to drive engagement, community and improvement.
Trend Five: Diversification
Historically many of the most successful HealthTech developments have answered a previously unmet need. We see a huge opportunity for HealthTech to cater to historically underinvested populations in the health, fitness, and well-being space.
One area that stands out is FemTech - which hit $16 billion in total industry funding last summer, up 15% from December 2021. FemTech is technology focused on the health needs of cisgender women, as well as people who have similar health needs and identify as transgender or non-binary. Examples of FemTech range from menstrual products to gynaecological devices, and diagnostics and treatments tailored to women’s health, such as those provided by LEVY Health.
Though this uptick in investment marks significant progress, funding for women’s digital health companies still made up just 7% of total US digital health funding from January to August 2021, according to a report from venture fund Rock Health. We’re keeping a close eye on this space and would love to meet more founders innovating in this area.
Trend Six: Digitisation
Finally, there is a global, ongoing and irreversible trend towards digitisation across every sector, and fitness and healthcare are no exception. Software continues to transform the customer journey, increasing access, reducing the potential for human error and increasing efficiency across the value chain.
Companies like Change Healthcare are amongst the leaders of this transition of healthcare into the digital future.
So, what’s piqued our interest?
At True, we back mission-driven entrepreneurs building a better, more sustainable future at the forefront of consumer behavioural change, and Consumer HealthTech is a key theme we’re focused on. If you’re a Pre-Seed to Series A founder in the Consumer HealthTech space, or an investor and would like to exchange ideas, we would love to hear from you.