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Hormonal health is a massive opportunity: Where are the unicorns?
Gaslighting is a form of psychological abuse, but Elizabeth Ruzzo says she experienced it firsthand after telling a doctor that she suffered from suicidal ideation after taking birth control pills.
Hormonal health sits at the center of conversations around personalized medicine and women’s health: By 2025, women’s health could be a $50 billion industry, and by 2026, digital health more broadly is estimated to hit $221 billion.
Ruzzo’s doctor told her there was no connection between birth control and self-harm, but she decided to stop taking the pill to see if her mental health improved. When it did, Ruzzo grasped the disconnect between women’s unique hormonal makeup and blanket-statement practices from medicine today.
Her realization led her to found Adyn Health, a startup that proactively helps women make health decisions that complement their hormonal state and background. The company started with, of course, helping people pick more personalized birth control.
Ruzzo is part of a group of growing entrepreneurs who are betting that hormonal health is the key wedge into the digital health boom. Hormones are fluctuating, ever-evolving and diverse — but these founders say they’re also key to solving many health conditions that disproportionately impact women, from diabetes to infertility to mental health challenges.
Many believe it’s that complexity that underscores the opportunity. Hormonal health sits at the center of conversations around personalized medicine and women’s health: By 2025, women’s health could be a $50 billion industry, and by 2026, digital health more broadly is estimated to hit $221 billion.
Still, as funding for women’s health startups drops and stigma continues to impact where venture dollars go, it’s unclear whether the sector will remain in its infancy or hit a true inflection point.
The future is proactive
Ruzzo views Adyn as a precision medicine startup. Its main product is an at-home test that tracks hormone levels, assesses genetic risk for specific side effects, and then gives recommendations for which birth control methods best suits the customer with the fewest side effects.
By Ruzzo’s estimates, 98% of sexually active women use birth control for 30 years of their life. That sort of lifetime value proposition made the company look like a sweet deal to founders, and Adyn raised a $2.5 million seed in April 2021 in a round co-led by Lux Capital and M13.
The moonshot, though, is using that as a way to become a trusted partner in a woman’s life, helping understand baseline hormone levels throughout those 30 years.
“My hope is that we can use precision medicine approaches, including looking at genetic markers to identify reliable diagnostic criteria, that can remove that uncertainty and pain and diagnostic odyssey that people have to go through,” Ruzzo said.
If Adyn becomes a trusted partner with teenage women, it could reach a point where it can detect changes in hormone levels over time.
“The hormone reference ranges that are used [in labs] are too broad to be personalized, let alone prescriptive,” she said. “And so what we’re hoping to do is correct for things that we know affect hormone levels like age, weight, ethnicity and compare you to your own expectations.”
If the first wave of digital health was a company like Ro, which answers consumers when they have a condition such as erectile dysfunction or hair loss, the second wave will look more like Adyn, which helps consumers navigate their health before getting diagnosed with a condition or experiencing issues.
The industry standard is still to wait for consumers to realize they have a condition, and then go to the doctor to manage their symptoms or look for a cure. A new startup that recently graduated from Y Combinator is finding its way into hormonal health through that angle.
One-tenth of all women are impacted by a hormonal condition
Veera Health is a startup that wants to help women in India manage polycystic ovary syndrome, or PCOS. The hormonal condition can cause irregular periods, infertility or gestational diabetes in women, as well as acne, weight gain and excessive hair growth. Plus, PCOS is far from rare, impacting one in 10 women.
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New York’s David Energy has raised $4.1 million to ‘build the Standard Oil of renewable energy’
“We intend to build the Standard Oil of renewable energy,” said James McGinniss, the co-founder and chief executive of David Energy, in a statement announcing the company’s new $19 million seed round of debt and equity funding.
McGinniss’ company is aiming to boost renewable energy adoption and slash energy usage in the built environment by creating a service that operates on both sides of the energy marketplace.
The company combines energy management services for commercial buildings through the software it has developed with the ability to sell energy directly to customers in an effort to reduce the energy consumption and the attendant carbon footprint of the built environment.
The company’s software, Mycor, leverages building demand data and the assets that the building has at its disposal to shift user energy consumption to the times when renewable power is most available, and cheapest.
It’s a novel approach to an old idea of creating environmental benefits by reducing energy consumption. Using its technology, David Energy tracks both the market price of energy and the energy usage by the buildings it manages. The company sells energy to customers at a fixed price and then uses its windows into energy markets and energy demand to make money off the difference in power pricing.
That’s why the company needed to raise $15 million in a monthly revolving credit facility from Hartree Partners. So it could pay for the power its customers have bought upfront.
Image Credits: Getty Images
There are a number of tailwinds supporting the growth of a business like David Energy right now. Given the massive amounts of money that are being earmarked for energy conservation and energy efficiency upgrades, companies like David, which promise to manage energy consumption to reduce demand, are going to be huge beneficiaries.
“Looking at the macro shift and the attention being paid to things like battery storage and micro grids we do feel like we’re launching this at the perfect time,” said McGinniss. “We’re offering [customers] market rates and then rebating the savings back to them. They’re getting the software with a market energy supply contract and they are getting the savings back. Bringing that whole bundled package together really brings it all together.”
In addition to the credit facility, the company also raised $4.1 million in venture financing from investors led by Equal Ventures and including Operator Partners, Box Group, Greycroft, Sandeep Jain and Xuan Yong of RigUp, returning angel investor Kiran Bhatraju of Arcadia and Jason Jacobs’ recently launched My Climate Journey Collective, an early-stage climate tech fund.
“Renewable energy generators are fundamentally different in their variable, distributed, and digitally-native nature compared to their fossil fuel predecessors while customer loads like heating and driving are shifting to electricity consumption from gas. The sands of market power are shifting and incumbents are poorly-positioned to adapt to evolving customer needs, so there’s a massive opportunity for us to capitalize.”
Founded by McGinniss, Brian Maxwell and Ahmed Salman, David Energy raised $1.5 million in pre-seed financing back in March 2020.
As the company expands, its relationship with Hartree, an energy and commodities trading desk, will become even more important. As the startup noted, Hartree is the gateway that David needs to transact with energy markets. The trader provides a balance sheet for working capital to purchase energy on behalf of David’s customers.
“Renewables are causing fundamental shifts in energy markets, and new models and tools need to emerge,” said Dinkar Bhatia, co-head of North American Power at Hartree Partners. “James and the team have identified a significant opportunity in the market and have the right strategy to execute. Hartree is excited to be a commodity partner with David Energy on the launch of the new smart retail platform and is looking forward to helping make DE Supply the premier retailer in the market,” said McGinniss.
David now has retail electricity licenses in New York, New Jersey and Massachusetts and is looking to expand around the country.
“David Energy stands to reinvent the way that hundreds of billions of dollars a year in energy are consumed,” said Equal Ventures investor Rick Zullo. “Business model creativity and finding ways to change user behavior with new models is just as important if not more important than the technology innovation itself.”
Zullo said his firm pitched David Energy on leading the round after years of looking for a commercial renewable energy startup. The core insight was finding a service that could appeal not to the new construction that already is working with top-of-the-line energy management systems, but with the millions of square feet that aren’t adopting the latest and greatest energy management systems.
“Finding something that will go and bring this to the mass market was something we had been on the hunt for really since the inception of Equal Ventures,” said Zullo.
The innovation that made David attractive was the business model. “There is a landscape of hundreds of dead companies,” Zullo said. “What they did was find a way to subsidize the service. They give away at low or no cost and move that in with line items. The partnership with Partree gives them the opportunity to be the cheapest and also the best for you and the highest margin regional energy provider in the market.”
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On the diversity front, 2020 may prove a tipping point
Since Minneapolis police officers killed George Floyd in May and kicked off months of nationwide protests, the corporate world — including venture capitalists — have attempted to respond to the Black Lives Matter movement.
Indeed, many quickly took to social media to voice their support, broadcast their new diversity-focused networking groups and pledge to do better, particularly when it comes to finding and funding more Black founders and other underrepresented entrepreneurs.
As of 2018, 81% of venture firms still lacked a single Black investor.
It was tempting to dismiss it as so much hot air, given that VCs have talked about diversity for eons without doing much about it.
As of February 2020, according to a report by All Raise, an organization that promotes female founders, 65% of VC firms still had no female partners. As of 2018, 81% of venture firms still lacked a single Black investor, per an analysis by Equal Ventures partner Richard Kerby.
Those numbers are comparatively rosy when considering the percentage of women and Black investors in senior decision-making roles. According to recent PitchBook data, at the start of this year, just 12.4% of decision-makers at U.S. venture firms were women (up slightly from the 9.65% at the start of 2019). As for for the number of Black investors in senior positions, it has long hovered around just 2%.
But here’s the good news: While it remains an ongoing challenge to get these numbers in sync with other industries, there were two developments specifically in 2020 that may beget more action in 2021.
We’d first point to the decision this fall by Yale’s endowment to require its asset managers to do better when it comes to diversity. Specifically, the school’s $32 billion endowment — led since 1985 by investor David Swensen — told its 70 U.S. money managers that from here on out, they will be measured annually on their progress in increasing the diversity of their investment staff, from hiring to training to mentoring to their retention of women and minorities.
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