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BFD Expert Voices - Health Tech Deals

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Data: Carta; Chart: Tory Lysik/Axios Visuals

The share of women founders rose more in the last six years in the health tech sector than in any other sector, per data from Carta.

Why it matters: Health tech is bucking a decades-long trend in the venture-backed startup sector that's seen startups founded predominantly by and for white men, Erin writes.

Driving the news: Women make roughly 80% of all health care decisions for their families and are increasingly starting and leading companies designed for their needs — whether they be focused on behavioral health, reproductive well-being, preventive care, or parenting.

The reversal of the constitutional right to abortion just one year ago further deepened public awareness of the women's health tech sector.

Plus, even amid a global market turndown that's seen funding for the health tech sector as a whole plummet 48% from 2021 to 2022, interest in women's digital health has remained somewhat steady, dropping just 10% over the same period.

Zoom in: The percentage of women-identifying founders in health tech rose from about 15% in 2015 to nearly 22% in 2022, per Carta — contrasting sharply with the average change across industries over the same time period, where:

The percentage of founders who identify as women shifted just slightly from 13% in 2016 to 15% in 2020.

Yes, but: Even in the sectors with the most female representation, the percentage of women founders remained under 25% in 2022.

Women of color are further underrepresented: Just 14% of Black women health tech founders received venture funding in 2020, compared with 36% of white women, per Rock Health data.

Meanwhile, several factors beyond the reversal of Roe v. Wade are driving continued interest in women's health, including...

A rise in public awareness of life stages including menstruation, maternity and menopause.

Employers expanding reproductive health benefits amid a tight labor market.

An increasing number of women turning to digital health tools like wearables, tracking tools and telehealth services.

Heightened sensitivity around health data sharing.

The mental health crisis disproportionately impacting teen girls.

1 big thing: Steady increase in women's health tech founders

High-stakes call center training business ReflexAI raised $3.3 million in seed funding, CEO Sam Dorison tells Erin exclusively.

Why it's the BFD: The recent launch of the nation's mental health hotline 988 has spiked call volume to crisis centers, which need resources to manage that increase.

Driving the news: Cities including Washington and San Francisco have seen an estimated 9%-12% of pleas for help go unanswered.

"There's a lot more volume coming into the system," says Reflex CTO John Callery. "We're here to really help a lot of these organizations meet that need."

Details: Footwork led the round, joined by Emerson Collective, Altman Capital, Gaingels, and several individual backers.

Funds will be used to build Reflex's core operating platform and team and hone examples of use cases for its tech.

Dorison foresees Reflex raising a Series A sometime in the next two years.

How it works: Reflex provides AI-powered training and quality assurance tools for call centers in industries such as crisis response, 911 dispatch and health care.

Dorison likens the tools to flight simulators for pilot training, where they can be used both to help train people and also to assess their abilities.

Flashback: Dorison and co-founder Callery met as executives at LGBTQ+ suicide prevention nonprofit The Trevor Project, where they developed Reflex's tech backbone.

At his former employer, training volunteer counselors was "one of the least scalable aspects of the organization," Callery recalls.

He and Dorison began experimenting with automating the training's role-playing component using early versions of ChatGPT or GPT 2.

The pair soon started getting inbound interest from related organizations interested in using the tech to help them scale their own efforts — leading them to create Reflex.

What they’re saying: Given the potential applications of Reflex across mental health, Dorison and Callery stressed the need to make their AI as transparent and explainable as possible, including the evaluation scores they provide to employees.

There should be "a very clear understanding between the score they got and what they need to do to improve it," says Callery.

"If you're in the mental health space, you need that level of transparency — you can't just trust an algorithm," he adds.

2. The BFD: ReflexAI seeds $3M for call center tech

an illustration of a hand holding a cell phone surrounded by health pluses and cutouts of money 

Looking for a deal story? Search the Axios Pro Deals Tracker beta.

• RiverGlade Capital-backed Dynamic Access, a Dallas-based outsourced provider of vascular services, acquired Priority PICC Solutions, a Chicago-based provider of outsourced vascular access services for an undisclosed amount. https://axios.link/3Qb1eZU

• General Atlantic made an investment of up to $160m into MAC Hospitals, a Mexican hospital provider backed by Actinver and PineBridge. www.hospitalesmac.com

• Bansk Group, a New York-based consumer-focused private investment firm, closed its inaugural fund, Bansk Fund I LP, at $800 million. https://axios.link/44ZRK8e

• Supply Change Capital, a venture capital firm that invests in the future of food, closed its inaugural $40M fund. https://axios.link/3pSaUhu

3. Deals o' the day

• Sukie Dean left a post as head of operations at Sunfish to become VP of partner success at Bicycle Health.

• Ezequiel Navar and Alexander Despo left posts as managing director and VP, respectively, at Crosstree to become managing director and VP at Union Square Advisors.

• Lynne Nowak left a post as chief medical officer of Lark Health to become chief data and analytics officer at Surescripts.

• Garet Free left a post as VP of partner success and strategy at DispatchHealth to found health care consultancy Zeke Lawrence Group.

4. It's Personnel

💉 They took blockbuster drugs for weight loss and diabetes. Now their stomachs are paralyzed — CNN

💸 PE ownership worsens quality, raises costs — Health Care Dive

5. Your daily dose

illustration of a digital thermometer that reads "daily dose" 

It's Wednesday, Health Tech readers. You've made it halfway through the week!

🍽️ 😋Aaron is excited for NYC restaurant week (as if he doesn't go out to eat often enough) and looking forward to trying new places. Send any recs his way!

🥇Thanks for reading, and extra thanks to newsletter editor Claire Rychlewski and copy editor Mickey Meece. Please ask your colleagues, friends and family to sign up.

July 26, 2023

1 big thing: Steady increase in women's health tech founders