How Wisp Built an $80 Million Women's Health Empire with Less Than $2 Million in Primary Capital

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Wisp launched in 2018 as a telehealth platform focused on women's sexual and reproductive health.

Here are the numbers behind the business:

• $80 million annual revenue run-rate by July 2024

• 4-year CAGR of 69% with less than $2 million in primary capital

• Over 1 million patients served across all 50 states

• $41.3 million acquisition by WELL Health Technologies in 2021

Here's how Wisp was able to achieve this remarkable growth in a stigmatized industry:

1. Target Angel Networks Focused on Women's Health Instead of Traditional VCs

When founder Matthew Swartz started Wisp in 2018, he didn't chase traditional Silicon Valley VCs who often don't understand women's health.

Instead, Wisp focused on angel investors who specialized in women's health and understood the massive market opportunity.

The femtech space had breakthrough funding in 2021, with global venture capital surpassing $2 billion for the first time, but Wisp was ahead of this trend.

The company strategically connected with angel networks that focus on:

• Female founders and women's health solutions

• Investors who understand regulatory complexities in healthcare

• Angels with expertise in telehealth and e-pharmacy models

This approach allowed them to secure initial funding from investors who weren't scared off by the "taboo" nature of sexual health.

These specialized angels provided not just capital, but industry expertise and connections.

2. Build a Subscription Model That Creates Predictable Cash Flow

Wisp didn't rely on one-time transactions.

Instead, they built a subscription-based model for ongoing treatments like birth control, UTI prevention, and sexual health maintenance.

This strategy resulted in greater than 50% returning/subscription revenue and NPS scores of 79.

Here's why this worked so well:

• Predictable revenue: Monthly subscriptions for ongoing conditions created a steady cash flow.

• Lower customer acquisition costs: Happy customers became repeat customers.

• High gross margins: They achieved gross margins exceeding 65%.

The subscription model meant Wisp didn't need massive upfront capital to acquire customers repeatedly. Once someone became a customer, they often stayed for months or years.

3. Use Revenue-Based Growth Instead of Equity Dilution

Wisp has generated positive EBITDA since 2021, which means they could reinvest profits rather than constantly raising dilutive funding rounds.

Their strategy was simple but effective:

• Reinvest profits strategically: Instead of distributing profits, they put money back into customer acquisition and product expansion

• Focus on unit economics: With 65%+ gross margins, every new customer was highly profitable

• Scale without equity dilution: By staying profitable, they avoided giving up control to VCs

In 2024, Wisp introduced over ten new products, including expanded offerings in fertility, menopause, and at-home testing.

They were all funded through operational cash flow rather than external investment.

4. Time the Market for Maximum Valuation When Ready to Exit

Wisp's timing for their exit was brilliant.

They built the business profitably from 2018 to 2021, proving the model worked.

Then, when telehealth exploded during the pandemic, and women's health became a hot investment category, they were ready.

WELL Health acquired them for $41.3 million in 2021, when Wisp had a $30 million annual revenue run-rate.

The acquisition included:

• $27.7 million in cash upfront

• $6.2 million in WELL Health shares

• Performance earn-out up to $7.4 million

By waiting until they had proven revenue and profitability, Wisp commanded a premium valuation. At the time of acquisition, WELL noted that telehealth services had seen a nearly 40x increase from pre-pandemic levels.

The founders maintained control throughout the growth phase and were able to exit on their terms when market conditions were optimal.

Right now, Wisp continues to thrive under WELL Health:

• Revenue run-rate has grown to nearly $80 million by 2024

• They're expanding into new health verticals like fertility and menopause

• The platform now serves over 1 million patients

Wisp's story shows that you can build a massive healthcare company without traditional VC funding by focusing on the right investors, building sustainable unit economics, and timing your exit strategically.

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