Where wellness tech is heading
Denis Dmitrenko, investment director of the venture capital fund GR Capital, talks about the prospects for wellness tech in the global market.
Today, the wellness tech market is comparable in terms of profitability to the high-tech sector. In the book “The Wellness Revolution - The Next Trillion Dollars”, American economist Paul Zane Pilzer calculated: the industry's annual turnover is more than $ 425 billion. Of the total global economy, the sector is more than 5%.
According to the 2018 Global Wellness Tourism Economy report, over three years, the wellness economy grew by 6.4% (from 2015 to 2017). These figures exceeded global economic growth (3.6%). Wellness services now account for 5.3% of global production.
Wellness technology trends are inextricably linked with consumer demand, as noted by GR Capital analyst Kirill Uho. Referring to the report of the Corporate Wellness Market - Global Outlook and Forecast 2018-2023, he emphasizes: the global corporate market will earn $ 72 billion by 2023 alone, while the average annual growth rate of the sector will be 8%.
The results of the Deep Focus study say that 80% of millennials spend almost one fourth of their income on maintaining health through wellness products and services. Recognized companies are increasingly choosing "health" marketing to promote new products.
The industry is developing towards health tech, paying attention not only to the physical but also to the psycho-emotional health of users. Keeping track of quality of life is a trend that application and device developers have adopted.
TheraGun massager for muscle recovery at home is popular among athletes. The principle of its work is based on shock therapy, replacing traditional massage. The device relieves muscle tension. The creators of the massage "pistol" argue that their goal is not to replace the usual massage session, but to weaken the pain signals entering the brain. The cost of the gadget varies from $ 299– $ 599.
You can learn more about how the industry lives through annual wellness exhibitions. At one of these events in Santa Monica, cryotherapy and infrared beds were provided to provide deep relaxation. The development is based on the NuCalm technique, which allows you to relieve stress and compensate for lack of sleep. The idea belongs to scientists at Harvard Medical School.
According to preliminary results, the NuCalm system is able to improve sleep quality. One application: the patient puts on his headphones and listens to ordinary music. However, a signal is sewn into the melody that allows the brain to work with the frequency at which the person falls asleep.
A survey of Alpha platform users showed that 54% of Americans who visit the gym at least once a month are interested in buying a home interactive fitness system.
Over time, sports classes in live mode have occupied a separate niche in the field of wellness services. Technology startup Mirror offers to conduct professional training at home. The sports system is a liquid crystal screen with a camera and speakers, which broadcasts online classes with an instructor from a New York studio.
In off mode, it looks like an ordinary mirror. The lesson will cost the owner of the Mirror $ 39, and the gadget itself will cost $ 1,500. The trainer sees who attends classes and knows the usernames thanks to their registration in the application. Mirror shows the heart rate and calories burned by users, as well as training statistics for the selected period. According to TechCrunch, the project raised $ 38 million from venture capital funds, including Spark Capital, First Round Capital, Lerer Hippeau and BoxGroup.
Mirror has a promising competitor - Peloton - an exercise bike and treadmill with a built-in screen. In the interactive home room, you can set the load level and pick up music. In the United States alone, the company has already earned $ 550 million, and plans to expand the number of consumers abroad.
Talking with a doctor via Skype or chatting - telemedicine - allows you to consult and get a prescription for a medicine in less than ten minutes. This technology is especially relevant in remote areas. In addition, the possibilities of digital medicine form a more comfortable and trusting atmosphere for patients. Therefore, we should expect a surge in consumer interest in telemedicine services and products next year.
A well-known company in this area is the Viome Home Health Test Provider. The application analyzes the state of the microbiome in the client’s body and offers products or nutritional supplements to improve health indicators. For example, it may be advisable to exclude bell peppers from the diet if bacteria are found in the body that impede the digestibility of the vegetable. The startup has attracted more than $ 45 million investment from Khosla Ventures, Physician Partners, and Salesforce CEO Mark Benioff.
Another analytical service was created by VTT research center specialists in Finland. The Odum application is based on artificial intelligence algorithms. The service analyzes the state of health, identifying the risks of developing diseases.
Mobile apps have also begun to use data to provide nutritional advice. Indian HealthifyMe platform generates nutritional and calorie information. The startup received more than $ 25 million in support.
An Israeli startup competitor, Nutrino, uses artificial intelligence to draw up a nutrition plan based on the physiological data of the user (stress and physical activity). At the end of 2018, medical equipment manufacturer Medtronic acquired Nutrino and scaled technology to help diabetes patients.
Digital platform EverlyWell offers a home blood test. A rapid test shows the immune response of the user and reveals the body's reactions to almost a hundred types of food. This Texas-based company received more than $ 55 million from investors, including Goodwater Capital, Highland Capital Partners and NextGen Venture Partners.
Rock Health Venture Fund Analysts analyzed the demand for digital healthcare products in 2018. According to the survey, people trust online consultations no less than real ones.
How much is invested in the field
Over the past ten years, $ 3.4 billion has been invested in health tech companies, which is 11% of all venture capital investments over this period. In 2018, medical startups received $ 1.3 billion in investments, which is three times more than in 2017. For example, the American Well telemedicine platform last year raised $ 291 million, and the Doctor on Demand application received $ 74 million.
A new generation of healthcare providers, such as Oscar and CareMore Health, have made telemedicine a key component of patient-centered treatment models. The trend was picked up by the Doc.ua project - a free online service for finding doctors and appointments.
According to the Global Wellness Institute, in three years the global industry of wellness tech will grow to about $ 180 billion. This trend suggests that the public’s demand for services in this area is growing.
Although the digital health sector is still relatively young, major deals are emerging in it. In the coming years, the wellness tech market will offer consumers ever more technological solutions that increase the quality of life.