Why Taboos are the next hotspot of Tech innovation

Fall 2017. It’s a warm New York evening and I’m sitting at a monthly brainstorm session hosted at Human Ventures; one of the attendees, the remarkable thought leader and entrepreneur Patrycja Slawuta (Founder, Self-Hackathon) makes a comment that I have not been able to shake since: “Everyone is inventing for the light, but we really need to innovate around the darkness.” Her comment got my mental juices flowing and have since sent me down a year long rabbit hole of exploration around taboos, aka “the darkness”.

Let’s first start with what I mean by darkness. Meriam-Websters defines taboos as: “something that is not acceptable to say, mention, or do; a prohibition imposed by social custom or as a protective measure.” While taboos vary greatly across nationality, race, religion and beyond, those that most Americans would categorize as “not acceptable to say, mention or do” include: sex, addiction, mental health, divorce, death, and finance.

While the media and startup community would have us in eternal pursuit of the next fad diet or exercise routine (I see you, goat yoga), the sad truth is that Americans face a multitude of harrowing statistics: one in six will experience an addiction throughout their life, >40% of marriages do not survive, nearly one in five will suffer from a mental health issue over the course of their lifetime. And, let’s face it, 100% of us die.

Bringing these stats down to a more personal level, in the last year alone I have sought a therapist’s help, frozen my eggs, and ordered tampons online. With friends, I have sat through dinner-time tales of infertility, family financial trouble and debt, divorce, anorexia and more. As much as social media has trained us to “crush it”, we are ultimately human to our core.

Armed with these personal anecdotes, I spent the past several months diving headfirst into articles and coffee chats with dozens of entrepreneurs, colleagues and investors to explore taboos. I pondered what has inhibited growth in these spaces in the past, and considered what I (we), as startup “professionals”, can build to alleviate these areas.

After twelve months noodling on this idea of “building for darkness”, I am now convinced that innovation around taboos is a massive growth opportunity for the startup community. Not just from an intellectual or societal perspective, but also financial. Allow me to elaborate:

Financial Opportunity: Like it or not, taboos draw in big bucks, yet many of these markets have not yet been disrupted by technology:

• Global Sexual Wellness Market was $39.42 billion in 2017; with a CAGR of 13.4%, it’s expected to reach $122.96 billion by 2026. (source)
• Public and private spend on mental health is estimated to grow to $280.5 billion by 2020. (source)
• Addiction —Global addiction market spend estimated to be $66B.
• Death Care Industry — Currently estimated to be a $20B annual market in the US. (source)

And that’s just the start.

Why Now: Over the last year, we’ve seen the national conversation around once taboo subjects change dramatically.

In a post-Weinstein, #metoo, Parkland, Anthony Bourdain and Kate Spade world, the general population has found their voice, normalizing issues that were once too off-limits to discuss publicly. Pair this with a rising generation of iPhone-carrying, social media connected Gen-X, Millenials and Gen-Z’s, and we are poised for greater transparency across the board.

More to come: we’re seeing early wins for companies in the taboo space, and there’s room to grow:

Precisely because humans are complex beings, the number of taboos to innovate around is broad. Below is a selection of areas ripe with opportunity, and a list of the startups who have already seen early funding wins in each:

Sex & Reproductive Health

• Modern Fertility ($7M) — Closing the fertility information gap by letting women test key fertility hormones at home.
• Nurx ($41.4M) — On-demand birth control delivery company that prescribes contraceptives through its app.
• Hims ($97M) & Roman ($91.1M) — Direct-to-consumer men’s health companies providing access to “unmentionable” items a la Propecia, Viagra and more.
• Maude ($550K) — Direct to consumer sex products.
• Tia ($2.5M) — Your one-stop-shop for female health online & offline.

Divorce

• It’s Over Easy (Funding unknown) — Founded by celebrity lawyer Laura Wasser, the website ”Helps divorcing couples become the masters of their own destiny”. Read more about them in the NYTimes

Addiction

• Groups (Funding unknown) — helps people recover from opiate use through therapy and medication.
• Village (Funding undisclosed)— Forum and community-based answers to help those with loved ones suffering from addiction. [Disclosure: Village was incubated out of my current employer Human Ventures]

Death

• Cake ($1.6M) — Aid planning for end-of-life treatment
• Grace ($2M)– Marketplace for searching & identifying hospice and assisted living centers

Mental Health

• Talkspace ($59M) — online therapy startup that offers affordable and confidential therapy with network of professional and licensed therapists
• Spring Health ($8M) — Spring uses AI to help patients with mental health problems feel better faster

So now that I’ve made my case, I would be remiss if I didn’t acknowledge the downsides to building a company in a taboo space. Specifically, several of the topics listed above are challenging due to customer acquisition issues, unproven unit economics, and a lack of open minded investors willing to place a bet on a taboo space if they themselves haven’t faced the problem (e.g. addiction). And of course, founders continue to battle widespread social stigma. Convincing customers to own up to their “darkness” is challenging work.

But for those founders who find a wedge, the rewards can be massive. Just ask Kimberly-Clark, who currently owns 50% marketshare of the $1.8B annual incontinence product market. Or the largest national funerary services provider Service Corporation International (SCI), whose stock price has over doubled from $18 in 2014 to $44 in 2018.

As much as we shy away from these topics, now is the time to let go of our pretenses and lean into the discomfort. Founders and investors, start shining a light on the darkness. The opportunities are ripe for the picking.

Do you know of another taboo subject that’s ripe for disruption or do you have ideas about how to accelerate innovation in the space? I’d love to hear from you ([email protected])!

Note: this article was first published on my personal Medium account: https://medium.com/@acphenderson/why-taboos-are-the-next-hotspot-of-tech-innovation-20f72ba09bd4