FemTech“FemTech is a national need in Japan”
FemTech
“FemTech is a national need in Japan”
Co-Founder and CEO of Network in Motion, Ira Prigat, spoke to CTech about the potential for Israeli tech in the Japanese market, and how Israeli FemTech is perfectly suited to address Japan’s unique population crisis, which has led the government to designate raising the fertility rate and women’s health solutions as a national goal
The future of Israeli FemTech may lie east, according to Ira Prigat, Co-Founder and CEO of Network in Motion, an Israeli business consulting firm which specializes in sales and investment opportunities in Japan. “The Femtech market in Japan produces $5 billion in annual sales revenues every year, and it has to cater to 65 million women. This is an insane market,” Prigat explained during his lecture at FemTech IL’s annual conference on the opportunity for Israeli FemTech companies in the Japanese market.
“The sectors that are in the greatest demand are areas that Israel is already experienced in - we’ve been there done that: fertility, birth, menstrual health, and menopause. There are 450,000 IVF procedures in Japan every year. In the U.S. there are only 300,000, in a population double the size of Japan.”
The demographic challenges of modern Japan, which possesses the oldest population in the world with 30% of the population over 65, a rapidly aging workforce, and a plummeting fertility rate, has placed a growing burden on the country’s economy and healthcare system. The fertility rate of the population, and as a result, women’s health has become the greatest national crisis. “Healthtech, and specifically FemTech, is a national need in Japan,” Prigat told CTech. “This is reflected in government programs and funding for solutions regarding women’s health and fertility. There is a national initiative to increase the birthrate and to address women’s health issues overall.”
Japan’s population crisis has been decades in the making, sharply rising since the period of economic stagnation in the 1990s, amid a national effort to increase women’s participation in the workforce to great success. However, while women were granted greater professional and economic independence, they were and still are expected to stop working when they have children. A highly traditional society, Japanese women are expected to shoulder all childcare, with no burden placed on men who remain the sole earners.
“In recent decades this has caused a huge dilemma for Japanese women who are forced to choose between their career or a family,” says Prigat. As a result, there has been a growing trend among Japanese women to opt out of marriage and children, or to wait until later in life to have children, leading to low fertility rates and high demand for fertility treatment options.
This isn’t a problem that will be going away any time soon, says Prigat, who adds that the Japanese, unlike the West, plan “ten years ahead. When you’re engaging with a Japanese partner you have a solid, expected, long-term revenue.”
The road east
While Israeli tech companies have been historically focused on penetrating the U.S. or European markets, there is a growing awareness of the opportunity offered by Japan. “This is the third largest economy in the world. It has a $4.5 trillion GDP and a population of 125 million. The Tokyo region (Kanto) is worth the entire Italian economy - a G7 country. The Osaka region is the equivalent of the entire Swiss economy,” says Prigat, who says that the Israeli market needs to “diversify” and be less laser-focused on the U.S.
“While the U.S. market is much larger, and has less language or cultural barriers, it is extremely competitive and you need so much money to access it. The entire world is trying to break into this market. China, as well. Today, Europe is not united in the same way that it once was, so you often have to approach each market independently.”
Japan by contrast moves nationally as a whole when it focuses on a new market, especially when there are national guidelines to do so, as is the case with FemTech. Additionally, Japan serves as a major gateway to other Asian countries, including Arab states.
In the last several years, Japanese investment in Israel has become a stable component of the Israeli high-tech industry, accounting for more than 10% of all investment. But Prigat says that Japanese interest in Israeli tech isn’t only limited to investment. “Japanese companies want to obtain technology. They can distribute it in Japan. They are also interested in purchasing companies, and going through a full M&A, or investing along the milestones in order to make the product fit Japanese requirements.”
And, during a time period that has seen Israeli tech stagnate and foreign investment fall due to the global tech slowdown, the government’s judicial overhaul last year, and the ongoing war, Prigat says that Japanese interest in Israel remains. “The Japanese are very interested in Israel. They don’t get how 7 million people have created so much noise and so many technologies are coming out of here.”
While Japanese investment in Israeli tech has dropped this year, this is the case for foreign investment in general which has stagnated due to the war and the preceding year of political unrest. If anything, Prigat says that the war has had less of an impact on Japan’s interest in the Israeli market than in the U.S. and Europe where Israel’s war against Hamas is far more politicized. “As a result, this is an especially good time for companies to be turning their attention towards Japan,” says Prigat.
