The women’s health industry, which includes startups focused on connected breast pumps, period trackers, and other related apps and hardware, has secured over $5 billion in funding over the past five years. However, the market is becoming increasingly competitive, leading to consolidation. Two pioneering companies in this space, Willow and Elvie, are now merging.

Willow, a San Francisco-based startup known for its wearable breast pumps, is acquiring Elvie, a London-based company that developed a smart Kegel trainer and expanded to offer breast pumps and a bassinet for new mothers.

The terms of the deal have not been disclosed, but it is understood that Elvie was entering administration. Elvie had raised over $186 million in funding from investors, including Octopus Ventures, BlackRock, and Blume Equity, with a valuation of $241 million, according to PitchBook.

The acquisition talks between Willow and Elvie had been ongoing for some time, with Willow initially approaching Elvie to purchase the company. However, as discussions progressed, Elvie’s financial situation became increasingly challenging.

According to Willow CEO Sarah O’Leary, “The transaction is taking shape after many months of alternative expectations.” Willow will be taking on Elvie’s existing business, including its products and team, which currently consists of 170 employees across London and Bristol.

Willow has raised around $254 million in equity and debt funding from investors, including NEA and Meritech. Although the company’s valuation peaked at $256 million in 2021, it has since decreased. O’Leary declined to comment on the current valuation but hinted that the company may seek additional funding later this year.

Elvie’s financial struggles reflect the broader challenges facing the femtech industry, which is projected to be a $60 billion market this year. The industry has faced significant headwinds, including a lack of exit opportunities for later-stage startups and increased competition from cheaper products.

Furthermore, hardware startups, in particular, have struggled to achieve profitability. Willow’s acquisition of Elvie may mark the beginning of consolidation in the industry, with Willow aiming to establish itself as a leading platform.

Femtech has evolved significantly over the years, driven by advances in cloud technology, smartphones, and big data analytics. The industry has also been shaped by the demands of an increasingly empowered demographic. Willow’s challenge now is to convert this growth into long-term profitability.

As O’Leary stated, “We want to show that femtech products are not only great stories, but great businesses.” The success of this acquisition will be crucial in determining the future of the femtech industry and Willow’s position within it.