Cat playing with coins

Throughout 2020, venture capital interest and funding for both startups and existing players in the pet industry have grown substantially. Spending on pets in the United States grew to over $100 billion in 2020, as well, marking a trend that might continue into the future.

During the pandemic, the percentage of Americans working from home grew from about 20 percent to up to 70 percent during the peak of illness last spring. Since then, it’s dropped somewhat and was still hovering over the halfway mark as of late February. As people stay home more not only for work but also in order to socially distance, pets are becoming even more important parts of the family than they already were.

This, along with other factors, has prompted an increase in spending on furry family members.

working at home with the dog
Photo Courtesy: Unsplash

The biggest expenditures have been on pet food and treats. While our cats and dogs are not eating more individually, the increase in pet adoption during the COVID-19 pandemic has led to more mouths to feed. The next largest spending has been on pet supplies, over-the-counter medications, and the animals themselves. With more people home to throw a ball for the dog or to dangle a feather on a string in front of the cat, it’s natural that more would be spent on toys and other supplies for those animals.

Pet e-commerce sites are also earning a big chunk of the spending. While sites like Barkbox and Chewy are not new, e-commerce and delivery services overall rose by approximately 58 percent as a reaction to the pandemic. Some of this is due to lockdowns in various areas; if people could not get to the stores for non-essentials like leashes or cat toys, they were likely to simply order them online. Perhaps more of it was due to people’s desires not to enter potentially busy stores during waves of illness. Even needing pet food, preventative medication, and other necessities did not mean that anyone had to leave the house if they could simply order what they wanted online to be delivered within a day or two.

Pet-related startups were another niche benefiting from the pandemic. Investors have put over a billion dollars into these startups since 2017, so this is not something that has just taken off during the pandemic. Still, there are some companies that have gotten a lot of attention (and funding) in 2020. Here are some examples:

  • NuLeaf Naturals, located in Denver, grew by over 11,000 percent. This company offers CBD products for both humans and pets.
  • Pet Parents, a company in Iowa, develops pet products and grew over 1,200 percent.
  • PetWell Partners in Houston is a group of 35 veterinary practices throughout various states. It grew over 250 percent in 2020.
  • The Natural Dog Company in Colorado makes pet chews and grew 250 percent.
  • Josh’s Frogs, a pet store specializing in exotics in Michigan, grew over 200 percent.
Person shopping online on a laptop with a credit card
Photo Courtesy: Pixabay

Then there are the sectors that weren’t popular or even thought about much prior to 2020 that are also making headway now. One major example here is pet telemedicine. With people not wanting to leave home to have their own minor illnesses addressed, many doctors (for humans) transitioned to a telemedicine model, where people could call or video chat with their doctors in lieu of an office visit. While this is obviously not adequate for something like a serious laceration needing sutures or a heart attack or cancer treatment, many minor ailments could be addressed quite well virtually. Keeping people at home rather than in their doctors’ offices helped to reduce the transmission of COVID-19, particularly with asymptomatic cases.

The same strategy applied to pets. Many times, pet owners just need someone to tell them whether an ailment in their pet is serious and whether they need to be seen. In some cases, a pet might need a tweak in its diet. Other times, they might require medication, and for something like a minor skin infection, an ear fungus, or signs of an allergy, a prescription can be called in after speaking to the veterinarian, saving everyone a potential exposure. Telemedicine not only for humans but also for pets has enjoyed a boom in business and funding. One example is Bond Vet, a company with headquarters in the New York area.

Will these investments in pets continue through 2021 and beyond? As with some of the changes that took place during the pandemic (such as virtual learning becoming more widespread, working from home, and flexible hours), it’s likely that people will continue spending money on their pets as they’ve grown closer and bonded more strongly over the past year.

Featured Photo Courtesy: Pixabay