Edition #3: The Next Indian Health-Tech Startup
Rise in Indian women giving birth after the age of 30 is a potential market opportunity for new startups to tap into
In this newsletter I am going to focus on how product managers can unearth new market opportunities, find out how large that market is today and how much potential revenue you could make from that target audience. I intend to break these concepts down using a real example of a growing market segment in Urban India. If you or any of your friends are looking to tap into the rising health-tech space in India, please feel free to share this post with them.
22% increase in child birth from urban mothers who are within the 30-34 age group
Looking into India’s birth registration data over the last 10 years, we see an overall decline in age-specific fertility[1] rate across India, however when you zoom into this rate within urban regions you see a different story. Between 2015-2017, there were 71 births per 1000 Indian urban women within the 30 to 34 age group, compared to 58 births per 1000 between 2004-2006 within the same group. This potentially means urban families decided to have their first kid or second kid in their early 30’s versus having it earlier.
What is age-specific fertility rate?
The age-specific fertility rate measures the annual number of births to women of a specified age or age group per 1,000 women in that age group.
Below is a representation of the shift in how many babies were born per 1000 women of different age groups across the years. Observe the shift over the years within the “30 - 34” age group (notice the blue dot rising above the orange dot for the 30-34 age group on the x-axis).
Looking across the years this trend has been growing at 10% year over year and the expectation is that over the next 5 years majority of Indian urban families will have their first kid in their early 30’s. The current average age for Indian women giving birth to their first kid is 28 years.
Market Problem
There are very limited self service tools available in the Indian market that helps users assess their reproductive health. A quick search on google for “at-home fertility kits in India” shows countless results for at-home sperm counters and zero results for at-home female fertility tests. As the average age of Indian women having their first kid shifts above 30, there will be a need in the market for at-home female fertility tests so women can track fertility status as they age.
In order to show how large this market is we rely on data from ministry of statistics[2] for 2016. Below is the distribution of Indian population by age-group that shows the largest percentage of our population as of 2016 was between the age of 20-29, this will change post 2020 where the largest percentage of population will be within 25-35 age group. The table below has been marked up with the shift I see where India’s largest population segment is going to enter their early 30s. This shows us how large this market is if we decide to create a solution for this market.
As of 2019, the total female population in India is 500Million out of which 27% of them reside in urban India, which brings our target market to 135Million.
Even if we can successfully convert 10% of the urban female population in the first 4 years with a solution valued at INR 2500, then we are looking at a potential revenue of INR 3370crore ($460M) over the 4 years.
Persona
The primary market persona is going to be females above the age of 28 who wishes to be updated on their fertility status annually. These are individuals who are extremely busy and would like to have the freedom and convenience of taking these tests at home. They are educated and already part of an executive or managerial team.
Potential Startup Opportunity
There are 3 primary hormones that are tested as part of a routine blood draw to test fertility, Follicle stimulating hormone (FSH), Anti-mullerian hormone (AMH) and Estradiol (E2). Based on the data above I see a market segment with a high purchasing capacity for a female fertility focussed app that helps users test, track and advice them on their reproductive health on an ongoing basis. As an MVP, the startup could tie up with a clinic and target an urban location to test out the market with at-home blood draw service, this is very similar to what Practo does today in India for their annual health check up program. If the MVP attracts enough momentum from its users you can either expand to offer more fertility oriented services or expand to more locations.
Competitors in this space
Modern Fertility : Started in 2017, this US based startup has already grabbed a $11M Series A in June 2019 to help expand its operations to all of US. This probably points out that they have found product market fit and they need funds to scale (1-N as Peter Thiel would say). They began by offering an at-home finger prick test that helps users track 6 fertility hormones (This was their “0-1” as per Peter Thiel).
Practo: Currently they do have several offerings around at-home blood draws. It’s pretty easy for them to implement this but the long pole will be to carve out a segment within their own app for female fertility. This could be the unique selling point for a new startup, where you start at fertility testing, then mature into pregnancy care and then eventually graduate to natal care services.
FIN.
If you wish to invest your time in building a startup for this market problem, do let me know. I am interested in investing in it via the Manipal Alumni Angel Fund
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References:
[1] source: http://www.censusindia.gov.in/vital_statistics/SRS_Reports_2017.html
[2] source: http://www.mospi.gov.in/sites/default/files/publication_reports/Women%20and%20Men%20%20in%20India%202018.pdf