In a significant consolidation move, Willow, a San Francisco-based startup known for its wearable breast pumps, has acquired Elvie, a London-based femtech pioneer that offers a range of products for new mothers. The acquisition comes as Elvie enters administration, with terms of the deal remaining undisclosed.

The acquisition marks a significant shift in the femtech landscape, which has seen over $5 billion in funding over the last five years. Elvie, founded in 2013, had raised more than $186 million from investors, including Octopus Ventures, BlackRock, and Blume Equity, with a last valuation of $241 million. Willow, founded in 2014, has raised around $254 million in a combination of equity and debt, with a valuation of up to $256 million in 2021.

The deal brings together two trailblazers in the femtech space, with Elvie's products, including its smart Kegel trainer, breast pumps, and bassinet, complementing Willow's wearable breast pumps. The acquisition also expands Willow's team, with around 170 employees from Elvie's London and Bristol offices joining the company, although some are already working out their notice periods.

The consolidation move is seen as a strategic response to the challenges facing the femtech industry. The market, estimated to be worth $60 billion this year, has faced headwinds, including a lack of exit opportunities for later-stage startups and increased competition from cheaper products. Additionally, hardware startups, like Elvie, have struggled to turn a profit.

Willow CEO Sarah O'Leary, who stepped into the role at the end of 2023, sees the acquisition as an opportunity to build a wider platform and drive consolidation in the industry. "We want to show that femtech products are not only great stories, but great businesses," she said. The company may also look to raise more funding later this year.

The acquisition highlights the evolution of the femtech industry, which has grown rapidly in recent years, driven by advances in cloud computing, smartphones, and big data analytics. The industry has also been fueled by a more empowered demographic demanding tech solutions that meet their specific needs. Willow's challenge now will be to convert this demand into profit over time.

The deal also raises questions about the future of femtech startups, which have struggled to scale and achieve profitability. As the industry continues to evolve, it remains to be seen whether consolidation will be a key driver of growth and profitability for femtech companies.

For now, the acquisition marks a significant milestone in the femtech industry, as two pioneers come together to build a more comprehensive platform for women's health. As O'Leary noted, "The transaction is taking shape after many months of alternative expectations." The deal is expected to have far-reaching implications for the industry, as companies look to navigate the challenges and opportunities in the $60 billion women's health market.