Sex toy sales have skyrocketed, so why are startups screwed?

Big sextech businesses are banging, but startups struggle to seal the deal.


August 21, 2020

If anything good came out of the past couple months, it’s that we’re having a lot more sex. Plenty of pleasure-focused enterprises are raking in huge revenue.

But for many sex tech startups, stigma is still a barrier to entry.

It was already a hot market 

Sexual health revenues neared $30B globally in 2018, as we reported in Trends last year. And experts say sex tech could emerge from the pandemic in an even better position.

Big brands have been bangin’ since the lockdown era:

  • Wow Tech Group, which owns toy companies Womanizer and We-Vibe, reported a 200%+ increase in revenue in April.
  • The boink behemoth Adam and Eve saw a 30% increase in online sales in March and April.

But startups still struggle to seal the deal

Some VC funds have morality clauses that block ‘em from investing in “vices,” Pando reports.

Even crowdfunding is hard. Platforms with big audiences, like Instagram and Facebook, crack down on anything remotely suggestive.

And entrepreneurs often face speed bumps:

  • When sexual communication app LoveSync went on “Shark Tank,” the show’s lawyers insisted on scouring the founders’ pitch beforehand.
  • The wellness platform Unbound’s founder had trouble opening a bank account and renting an office.

There’s more than one way to shake the sheets

As one investor told Forbes, appeals to health and relationships can sway reluctant backers.

And a few newer funds focus specifically on sexuality:

Daily briefings, straight to your inbox

Business and tech news in 5 minutes or less

Join over 1 million people who read The Hustle

Psst

How'd Bezos build a billion dollar empire?

In 1994, Jeff Bezos discovered a shocking stat: Internet usage grew 2,300% per year.

Data shows where markets are headed.

And that’s why we built Trends — to show you up-and-coming market opportunities about to explode. Interested?

Join us, it's free.

Look, you came to this site because you saw something cool. But here’s the deal. This site is actually a daily email that covers the important news in business, tech, and culture.

So, if you like what you’re reading, give the email a try.