Legacy, the celebrity-backed sperm testing and storage startup, has banked $25 million in Series B funding, thrusting its valuation to $150 million, founder Khaled Kteily tells Axios exclusively.
Why it matters: Fertility has become a white-hot sector for venture investment of late, with backers pouring money into businesses tackling the financial and clinical aspects of starting a family.
- While many of those companies focus on women and their reproductive systems, half of all infertility cases involve problems related to sperm, says Sophia Yen, a Stanford clinical associate professor and CEO of women’s telehealth company Pandia Health.
- “This is not just an issue that heterosexual women should be worried about,” Kteily tells Axios.
Details: Bain Capital led the round and was joined by FirstMark Capital, Section 32 and TQ Ventures.
Driving the news: Several demographic trends are adding fuel to the fertility tech fire, industry observers and investors tell Axios.
- People choosing to have children later in life, making the process biologically more challenging and increasing the appeal of supportive technology.
- Decreased stigma around discussions about reproductive health, infertility and women’s health.
- Employers increasingly viewing reproductive health tools as a core workplace benefit.
Context: The past three months have seen a rush of VC interest in startups offering everything from IVF financing tools to nutritional support and home hormone testing.
How it works: Legacy offers its services both directly to consumers and via contracts with employers, insurers, the Veterans Administration and the military.
- For a full semen analysis, users order a mail-in test kit for $195, produce a sample at home and ship it back to Legacy’s lab.
- The company also offers unlimited telehealth visits with urologists and fertility nurses and cryopreservation for between $100 and $150.
- In terms of order volume, Legacy is the largest sperm analysis and storage company in the U.S., says Kteily. “We are drowning in sperm.”
- The company offers its services to anyone with sperm, regardless of gender identity, Kteily says.
One fun thing: Kteily’s Instagram handle has long been @djnotkhaled, but he’s been forced to rethink that since the real DJ Khaled has invested in his startup along with Justin Bieber, The Weeknd, and Orlando Bloom.
What they’re saying: Investors and clinicians tell Erin they are pleased to see more of a focus on inclusive fertility efforts that bring men and people who identify as LGBTQIA+ into the equation.
- “Addressing infertility requires innovations that drive toward more inclusive — and ultimately more effective — family care,” Deena Shakir, a partner at Lux Capital who has invested in fertility companies including Alife and Maven.
- “I am heartened to see an increased focus on sperm health, especially efforts like this to make sperm preservation and testing more widely accessible — and also more widely acceptable,” Shakir adds.
What’s next: Legacy plans to use the funds to double its staff and launch an in-person service that lets people supply a sample and get results on the same day.
