Willow Acquires Elvie Assets: Breast Pump Industry Update

Funding and Consolidation in Women’s Health Tech

Over the past five years, companies focused on women’s health – including those developing connected breast pumps, period tracking applications, and related hardware – have secured over $5 billion in funding. However, the market remains highly competitive, prompting consolidation among key players.

Willow Acquires Elvie

Willow, a San Francisco-based startup renowned for its wearable breast pumps, is acquiring Elvie. Elvie initially gained recognition for its smart Kegel trainer and subsequently expanded its product line to include breast pumps and, most recently, a bassinet.

Deal Details and Elvie’s Situation

The financial terms of the acquisition haven't been publicly released. However, it’s understood the deal is occurring as Elvie enters administration. The London-based startup had previously raised over $186 million across 12 years, attracting investment from firms like Octopus Ventures, BlackRock, and Blume Equity.

Negotiations and Business Transition

Discussions between the two companies began when Willow initiated contact to explore a potential acquisition. As negotiations progressed, Elvie simultaneously faced challenges related to its financial runway.

“The transaction is the result of several months of considering various possibilities,” stated Sarah O’Leary, CEO of Willow, in a recent interview.

Team and Workforce Impact

Willow is assuming responsibility for Elvie’s existing operations, encompassing its product portfolio and workforce. Currently, 170 individuals are employed across locations in London and Bristol. It's noted that some employees are already serving notice periods and will not be joining Willow.

Willow’s Financial Standing

Willow itself has raised approximately $254 million through a combination of equity and debt financing, with investors including NEA and Meritech. The company’s valuation peaked at $256 million in 2021, but experienced a decline in 2024 during a subsequent funding round.

O’Leary refrained from commenting on the company’s current valuation but indicated a potential for further fundraising later in the year.

Challenges in the Women’s Health Market

Elvie’s financial difficulties reflect broader challenges within the women’s health sector. Despite being a $60 billion market this year, the industry has encountered several obstacles. Funding for later-stage startups, particularly those not heavily focused on artificial intelligence, has become more difficult to secure.

Limited exit opportunities for women’s health businesses, coupled with an influx of lower-priced competing products, contribute to the challenging landscape.

Patent Disputes and Data Security

The market is saturated with similar products, leading to legal disputes. Elvie previously engaged in patent infringement litigation, both as a plaintiff and a defendant – notably, Willow filed a patent suit against Elvie. The acquisition resolves this legal conflict.

Recent events involving 23andMe underscore the critical importance of robust user data management, especially concerning sensitive health information, and the potential risks when business operations falter. This is particularly relevant for women’s health and reproductive businesses given the current political climate.

Furthermore, transforming hardware startups into profitable ventures consistently presents a significant hurdle.

Willow’s Strategy for Growth

Willow anticipates that the acquisition of Elvie will initiate a period of wider consolidation within the industry. The company aims to establish itself as a leading platform by proactively acquiring other businesses, given the scarcity of alternative exit strategies.

The Rise of Femtech

The growth of women’s health technology, often referred to as femtech, has been fueled by advancements in cloud computing, smartphones, and big data analytics. These technologies have facilitated the development of engaging applications and the launch of hardware prototypes through crowdfunding platforms.

This expansion also reflects a growing demand from an empowered consumer base seeking technology tailored to their specific needs.