Interestingly, Willow had previously taken legal action against Elvie before finalizing the acquisition.

An investor has pointed out the challenges faced by UK tech companies in scaling, underscoring the necessity for strong US backing to thrive in the American market.

Willow, a San Francisco startup recognized for its innovative wearable breast pumps, has acquired UK-based femtech company Elvie, which is known for its smart Kegel trainer and breast pumps, as Elvie enters administration.

This acquisition occurs amid a wave of consolidation in the women's health sector, which has attracted over $5 billion in funding over the past five years but is currently grappling with significant market challenges.

Willow's CEO, Sarah O’Leary, believes this merger could indicate a broader trend of consolidation within the women's health market, valued at approximately $60 billion, especially as exit opportunities for non-AI focused startups have dwindled.

Elvie, which launched in 2013, raised more than $186 million throughout its 12-year history, with its last valuation reaching $241 million, but is now facing financial difficulties that have led to its transition into administration.

Willow plans to integrate Elvie's products and team, which includes 170 employees based in London and Bristol, although some employees will not be joining due to notice periods.

Current challenges in the women's health sector include an oversaturation of lower-cost products and complexities in managing user health data, as evidenced by recent issues faced by companies like 23andMe.

Despite its struggles, Elvie was once the most funded femtech startup in Europe, attracting investment from notable backers like BlackRock and Octopus Ventures.

O’Leary expressed enthusiasm about the merger, confident that it will bolster both companies' competitive positions in the market.

Willow has raised approximately $254 million and achieved a peak valuation of $256 million in 2021, although it has experienced valuation declines in subsequent funding rounds.

Management consultancy FTI Consulting is overseeing the acquisition terms, highlighting its significance within the healthtech sector.