Axios Pro: Health Tech Deals

January 24, 2023

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1 big thing: Fertility tech banks investor dollars

Illustration of a quarter surrounded by sperm.

Illustration: Shoshana Gordon/Axios

Fertility technology startups are in the midst of a funding frenzy, putting the category among the sixth most heavily funded treatment verticals in 2022, per Rock Health.

Why it matters: Demand for fertility services is on the rise, and its increasingly opaque and inaccessible nature has left room for nimble, tech-forward companies rushing to fill the gaps, Erin writes.

Driving the news: Several harsh realities about family planning and fertility have been cast into the spotlight in recent years:

  • The economics of infertility treatments remain heavily opaque, and insurance coverage varies dramatically by state and provider.
  • The fertility industry is highly inequitable, disproportionately impacting LGBTQ people, low-income people and people of color.
  • The overturn of Roe v. Wade enabled states to pursue reproductive health legislation that can create challenges for patients and providers in states including Arizona, Florida, Louisiana and Tennessee.

What they're saying: Employers, entrepreneurs and investors tell Axios they see their roles as more important than ever, with startups responding to employer demands by expanding their offerings to include reproductive care.

  • "We believe the ability to build a family is a basic human right," says Sunfish CEO Angela Rastegar.
  • "Women want control because it's being so restricted," Lori Evans Bernstein, the CEO of virtual-first women's health startup Caraway, told Axios last fall.
  • "Traditional reproductive endocrinology practices are the closest analogy to what we do, but they’re just not able to serve enough patients," says Amy Zwanziger, the CEO of a startup called Turtle Health that offers fertility testing at home.
  • "Addressing infertility requires innovations that drive toward more inclusive — and ultimately more effective — family care," says Lux Capital partner Deena Shakir.

By the numbers: Fertility startups banked a record $424 million in the last quarter of 2021, per a Rock Health report. Meanwhile:

Zoom in: As existing reproductive health companies' valuations rise, new startups are rushing to fill extant gaps in care. For example:

  • Sunfish Technologies, a company offering financing support for egg freezing and IVF, premiered this month with a $3.8 million seed round.
  • Maternity care provider Oula this month collected $19.1 million in Series A funds for a hybrid model that unites midwives and obstetricians.
  • The first maternal and family health startup to reach coveted unicorn status, Maven Clinic in November collected $90 million in Series E funds.
  • Posterity Health, a digital male fertility treatment provider, this month pulled in $7.5 million in seed funding.
  • Turtle Health, which is trying to replicate a full-scale fertility evaluation in the home, debuted in December with $5.4 million in seed capital.
  • Legacy, a celebrity-backed sperm testing and storage startup, in May banked $25 million in Series B funds at a valuation of $150 million.
  • Combining fertility financing and care support, Future Family in April raised $25 million in Series B funding at an $80 million valuation.

Yes, but: Although many of the companies in the sector 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," says Legacy CEO Khaled Kteily.

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