Celebrity sperm testing and storage startup Legacy has raised $25 million in Series B funding, boosting its valuation to $150 million, founder Khaled Kteily tells Axios exclusively.
Why it matters: Fertility has recently become a white-hot sector for venture capital, with backers pouring money into businesses that tackle 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 concerned about,” Kteily tells Axios.
Details: Bain Capital Ventures led the round and was joined by FirstMark Capital, Section 32 and TQ Ventures.
Manage the news: Several demographic trends are adding fuel to the fertility technology fire, industry observers and investors tell Axios.
- People who choose to have children later in life make the process biologically more challenging and increase the appeal of assistive technology.
- Reduced stigma around discussions about reproductive health, infertility and women’s health.
- Employers increasingly view reproductive health aids as a core benefit in the workplace.
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 directly to consumers and via contracts with employers, insurers, the Veterans Administration and the military.
- For a complete semen analysis, users order a mail-in test kit for $195, produce a sample at home and send 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 US, Kteily says. “We’re drowning in sperm.”
- The company offers its services to anyone with sperm, regardless of gender identity, Kteily says.
One nice thing: Kteily’s Instagram handle has long been @djnotkhaled, but he’s been forced to rethink that since the real DJ Khaled invested in his startup alongside Justin Bieber, The Weeknd and Orlando Bloom.
What they say: Investors and clinicians tell Erin they’re happy 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 more inclusive — and ultimately more effective — family care,” said Deena Shakir, a partner at Lux Capital who has invested in fertility companies including Alife and Maven.
- “I’m encouraged to see a greater focus on sperm health, especially efforts like this to make sperm preservation and testing more accessible—and also more widely accepted,” adds Shakir.
What is next: Legacy plans to use the funds to double its staff and launch a same-day service that allows people to provide a sample and get results within 24 hours.
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