Overview of the FamTech & BabyTech industry

Innovative technology has teamed with parents to make the family experience more positive (and easier!). Formerly known as BabyTech, this industry has made leaps and bounds for several years, focusing on families rather than merely the baby-to-toddler timeframe.

FamTech is a rapidly growing market, too. In 2019, the US BabyTech market size was nearly $46 billion, with no signs of slowing down. One unique trait about this industry is that many companies are blazing trails regarding marketing. In FamTech, more than any other market, founders are successful launching a content-first strategy instead of releasing products first. It’s a trend-setting approach that has undoubtedly paid off.

Graph of Top BabyTech Companies

Some of the biggest risks FamTech & BabyTech companies face

Cybersecurity

Connecting parents to essential resources typically involves collecting personal data. Unfortunately, this information makes FamTech companies more vulnerable to cyber attacks. Some of the most common threats are data breaches using ransomware, malware, phishing, and denial of service.

Globally, data breaches cost companies an average of nearly $4 million. These vicious threats are often sophisticated, multi-tiered, and financially motivated. Naturally, cybersecurity is a primary concern for FamTech companies and organizations worldwide.

Product failure

Any company releasing a product is at risk of that product failing. FamTech companies tread on even thinner ice than most businesses because they focus on children and babies. Whether it’s a sleep training app or milestone-tracking software, parents expect the product to work properly 24/7.

But let’s face it; even the best, most well-thought-out products flop sometimes. After all, over 30,000 new products are rolled out each year, and 95% of them fail. Connectivity, software bugs, and ill-timed launches can quickly put a wrench in hopes and dreams. Having a safety net for these situations is a must.

Content Accuracy

FamTech companies rely heavily on content marketing to gain and entertain a customer base. As mentioned, many of these businesses take the content-first as opposed to a product-first approach to marketing. So, accurate content is crucial to keeping paying customers around — but one inaccurate bit of information could mean costly lawsuits and loss of revenue from loyal customers.

Why is Insurance for FamTech Companies Important?

Notably, FamTech companies create a more parent-friendly work environment. It’s a shame that the US isn’t traditionally a comfortable place to work and parent simultaneously — but it’s not.

The FamTech industry helps parents find more comfortable and natural ways to parent successfully, instead of the traditional “go it alone and burnout” route.

That said, Millennials are the generation with young families and new standards on the parenting experience. With 93% of Millennials owning smartphones, FamTech is developing to serve and uphold this group’s tech-savvy demands.

Parents need a new strategy to wear multiple hats successfully, and the FamTech industry aims to help lighten the loads for families. With well-suited insurance policies, FamTech companies can protect themselves from any legal issues and keep a sturdy foot in the game of longevity.

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What Insurance do FamTech companies need?

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How much does Insurance for FamTech Companies cost?

The cost of insurance for FamTech companies will depend on several things, including the company’s size and development stage. Other factors include:

  • Exposures: risks being insured.
  • Company practices: views on safety, compliance, and risk management. 
  • Program structure: the amount of deductible and willingness for a company to assume more risk
  • Number of users on the platform
  • Claims history: the type and amount of past claims against the company

Types of FamTech Companies that need insurance

Parents have an enormous responsibility, so going it alone isn’t feasible or desirable anymore. From delivering meals for children to learning platforms for parents, FamTech companies run the gamut. Here are a handful of company types that make up the FamTech industry:

  • Baby gadgets and devices
  • Health monitor companies
  • Personalized baby products
  • Meal delivery programs
  • Childcare management Services
  • Pediatric Testing Solutions
  • Pediatric home care services
  • Online learning platforms for parents
  • Nutritional food products for children
  • Breastfeeding support platforms

Learn more about insurance for FamTech companies

Often referred to as Family Tech or BabyTech, FamTech is a rapidly growing market using technology to help parents navigate the challenges of raising a
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