Towards the end of 2022, American VC Andreessen Horowitz predicated that “the biggest company in the world will be a consumer health tech company”.¹

It was a bold but logical claim. At the time, 4 of the 5 biggest companies in the world were “consumer” focused, and given growing interest in individualised, tech-enabled healthcare solutions, it was plausible to think that it was only a matter of time before they turned their attention and resources to creating an all-conquering consumer healthtech solution.

One could argue that they already have: Apple in particular pride themselves on the way in which their tech makes it easier for people to focus on their health – with more solutions for physicians and frontline caregivers rumoured to be on the way².

With consumer healthtech grabbing all the headlines, and several massive companies exploring the space, local founders are faced with both exciting opportunities and extreme competition as they battle to build products, community, and a compelling equity story.

So, how do founders overcome challenges like the funding chasm between Series A and Series B, the slow pace of regulation and the complexity of expanding to the US, a key market, and build a business that can change peoples’ lives?

According to experts, it all starts with a relentless focus on product.

The modern consumer is a conundrum. On one hand, they are technically savvy, and increasingly focused on health and wellbeing; according to a recent report by McKinsey, their appetite for “effective, data-driven, science-backed health and wellness solutions”³ has seen the consumer wellness sector swell to $1.8T⁴.

However, that desire comes with high expectations and a demand for data privacy. They expect their tech to deliver seamless experiences, but may be skeptical about sharing private data – particularly when it comes to their health challenges.

But how to navigate these demands? For starters, product development needs to be shaped directly by consumer input. As Dr Natalie Getreu, COO of Hertility, states: “You need to really listen to what the community needs, and use that to inform product development”. By showing you are actually listening, you can create a community that trusts you enough to share candidly, creating a virtuous cycle of invaluable input that in turn allows you to create even better solutions while building an audience of advocates.

But building trust with your community does more than just help grow your audience – it’s crucial when you engage investors, too. Fresh off the back of their record raise, Flo Health CFO Tamara Orlova echoes the importance of building a great product as part of creating a compelling equity story:

I’ve written before that fundraising tends to follow a familiar path, but that does not mean that the well-worn path isn’t the only option. In fact, at a recent panel discussion I moderated at HSBC Innovation Banking’s London office, several panellists spoke extensively of the benefits of their own fundraising routes.

Bootstrapping

Amber Vodegel, exited founder of the Pregnancy + app, built her app with a focus on product and data privacy, but bootstrapped her business. For Amber, it was empowering: she had the autonomy “to make ethical decisions based on her belief that women shouldn’t be products” – a belief that eventually saw her business acquired by Philips.

For Stuart Peak, CEO at the HeliosX Group, bootstrapping has offered similar freedom. The flexibility to make strategic choices independently without competing input from investors means his business has managed to fund their own growth ambition, and make decisions on when and how to accelerate and expand into new markets.

As Hertility proves, crowdfunding is also an option for community-led consumer healthtechs. Their community fundraise saw investment from 1800 investors – 70% of whom are women; testament to the importance of providing trusted, scientific solutions to your community.

VC

Conversely, institutional investment has supercharged growth at Limbic. While CEO Ross Harper admits that “VC is a very specific game and it’s not for everyone”, he feels that partnering with Bay Area VC helped them to establish and initial launchpad and network, acting as a strategic accelerant. In this instance, finding the right partner with the experience needed to bring in value beyond capital has been crucial.

Like the consumers they serve, it seems healthtech founders need to find a fundraising partner that provides the right solution for their unique challenges.

With healthcare expected to represent 20% of US GDP in the early 2030’s⁵, it’s understandable that many founders have their passports ready and are raring to go, but expansion is not a decision to be taken lightly.

On one hand, the market is mostly English speaking, and largely private, with fewer regulatory hurdles to overcome. There is also a larger pool of potential investors. However, as Harper points out, “It’s an intimidating decision. The East Coast is littered with the corpses of companies that have tried that move and failed”.

UK founders are well placed to play the long game locally. It may be more affordable to leverage the research hubs and talent from leading universities to build a resilient product, and the core of a consumer base. Plus navigating the comparatively complex NHS procurement process can stand you in good stead when you’re ready to explore the US market.

As ever, it’s a question of timing. Peak is an advocate for patience, and cautions against chasing opportunities too soon: “Building sustainable, stable unit economics should outweigh chasing growth and big bets based on mega trends”.

Consumer healthtechs share a common goal: to make people’s lives better, but with the sector making headline news, it can be tempting to compete for column inches and investor interest, particularly when all roads seem to lead to the US.

However, as local examples show, taking the time to build a community, and use their insights to fuel product development, can help create a stable core for your business; a groundswell that can help to persuade potential investors – regardless of which fundraising option you choose next, be it bootstrapping, VC, or non-dilutive financing.

The UK is an ideal home for growing a business. World class minds, leading universities, and even complex regulations can all help resilient healthtech founders build a bulletproof business that could be a world beater.