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Baby-tech, parent-tech, fam-tech… call it what you will. The fact of the matter is, most millennials are having children later in life than their parents, and they want more efficient, streamlined ways to care for their kids.

From extending fertility to sleeping easier with a newborn to stimulating and tracking their child’s brain development, modern parents are using technology to do things in a more data-driven way than their parents did.

When it comes to his smart sock, parents and investors alike are buying in. Owlet, founded in 2013, remains a private company with an estimated annual revenue of $31.3M per year. In total, it has received $51.6M in funding.

Consider the case of Owlet Baby Care. The Owlet smart sock is a baby monitor that uses pulse oximetry to measure and track oxygen levels and heart rate, alerting parents via wirelessly connected devices if either reading drops to an unhealthy level. One sock costs $299 before additional accessories. According to Owlet founder Kurt Workman, “Parents spend a lot of money on their children, and will spend more if you can solve problems for them.”

Technology-driven parenting tools are here to stay, presenting lots of opportunity to investors. Here’s what investors should know about the fam-tech industry.

What is Fam-Tech?

Millennials are having fewer children, starting later in life, and their parenting style is driving new technologies. 

Consider that the fertility rate for the US in 2020 was 1.779 births per woman. That’s significantly lower than in 1950 when the fertility rate was nearly double that, at 3.148. 

According to a report by the New York Times, these days, first-time moms are on average 26 years old (up from 21 in 1972) and first-time dads are 31 (up from 27 in 1972). 

Even so, across the US, the age of becoming a mom for the first time is heavily divided primarily by one factor: education. Parents who have spent their time getting an education, building a career, and growing their income have children on average seven years later than those who don’t. These slightly older, well-educated parents are better able to afford everything from preschool to, well, Owlet socks.

Being an older parent isn’t out of the norm these days, and aspiring parents aren’t worried so much about age as their ability to have a baby at some point. Notably, egg freezing increased in 2020 when dating came to a halt. By 2026, the global IVF Market size is expected to reach $36.39 billion

These new-age parents are paying for things that in 1950 during the baby boom, parents likely never imagined. 

Consider, for example, a meal subscription just for babies. Square Baby personalizes a nutrition plan for baby based on their age, dietary restrictions, and preferences, sending nutritious frozen meals every two weeks. For older children, the company Raddish Kids offers a subscription plan focused on helping kids learn to cook in the kitchen. Raddish raised its first dollars ($3,515 above its $15,000 goal) though a successful 2013 Kickstarter campaign. 

Subscription services for kids are a big deal. And there are at least 22 clothing subscription services designed just for kids with parents that either a) don’t have the time or b) the interest to shop for new clothes every season for growing little ones. 

Subscription services are just one example of fam-tech at work. 

With parents so busy working, who has time to write out a baby book? Yet again, there’s an app for that. Queepsake captures moments and milestones via photos and messages on a smartphone, populating them into a book. 

Need help with bedtime for your little ones? The Hatch night light and connected app allows parents to adjust the sound from down the hall using a connected app.  The Hatch has a programmable “okay to wake” setting for young kids to help parents get a few more ZZZs. 

For older children, fam-tech has solutions for monitoring online activity, with parental controls over content and remote access to children’s online devices.

Why Invest in Fam-Tech?

Fam-tech has a huge market opportunity, with millennials looking to technology to help solve challenges associated with parenting in the modern world. 

For example, right now, a lot of families have a big problem. With more than a billion students suddenly unable to physically go to school in 2020 because of the pandemic, e-Learning became the unanticipated format of education in 2020. That means that these days, lots of parents are working alongside their kids who are schooling from home, leaving 65 percent of working parents feeling completely burnt out. 

When kids aren’t schooling and parents are playing catch-up, kids are left with more screen time than ever. That leaves parents trying to figure out which tools, apps, and tech they can direct their kids towards to help their learning and development move ahead, rather than regress. 

If 2020 has left a legacy, it’s rife with opportunities for new fam-tech solutions. And, according to the early-stage venture capital firm Initialized, we’re going to get them. From ways to get more sleep, to delaying parenting, to sourcing childcare, to tracking development, to monitoring e-learning, and more.

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The information and data are as of the February 16, 2021 (publish date) unless otherwise noted and subject to change. This blog is sponsored by Magnifi.  

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