Consolidation.
If you had to reduce the water-cooler talk of our field to one topic, it would be exactly this: the consolidation of IVF centers, fertility pharmacies, brokers, genetics companies and others, purchased with private equity money.
I wrote about these players, and the collective unease about them, in 2018. I have talked about it on the IRH podcast with guests such as doctors John Storment and David Sable. I hear the apprehensions and I share some of them.
Are we capable of betraying our patients’ best interest because of obligations to financial stakeholders?
That’s a very sound concern for the delivery of fertility care. Furthermore, it’s very likely that there are examples wherein this concern is justified.
I own Fertility Bridge outright, 100%. I often make decisions based on what I want for the relationships of our clients and employees. If I had to answer to many different shareholders, we would likely do things very differently.
Conversely, I also see examples where this pressure disrupts the status quo and forces innovation and efficiency when we have to compete to earn patients’ selection. Sometimes, the independent centers with the least competition are the least likely to invest in patient experience and team culture.
Either way, I do not see the consolidation of REI practice groups as the single greatest disruption coming to the field. Not by a long shot. In 2018, I also wrote that technological revolution dwarfs any disruption caused by the sale of IVF practice ownership to private equity.
While others are looking to Wall Street, I have my eye on Silicon Valley.
Consider it this way:
The independent REI practice is the local, 100 room hotel.
They’re worried about the Marriott building a 1,200 room, mid-rise on the waterfront.
I’m worried about AirBnB.
One view looks at larger and more dominant competitors in the same marketplace. I’m looking at a whole new marketplace.
The model for the delivery of healthcare, including fertility care, has become too estranged from the conveniences that patients are used to when researching, considering, receiving, purchasing, and evaluating goods and services as consumers.
Our patients under age 30 have conceivably never called by phone to invite a friend over, break up with a significant other, or even order food. Yet, for virtually every fertility center, there is ultimately no other way to schedule a new patient visit.
Please take my next admonition as commentary on the mechanics of patient relations and not on providers’ devotion to service; I know the depth and sincerity of so many practitioners’ vocations.
We’ve been too slow to adapt and have grown out of touch with our patient demographic. For some, it’s already too late.
I don’t envision large fertility groups or boutique REI practices going away, but another class is emerging to capture the middle, the entry, and everything around.
There is a wide opening to provide the user experience of patient acquisition and patient retention that the current demographic demands. With the right application, and/or scaled acquisition strategy, one or two platforms can become the gateway through which patients enter. Many companies are jockeying for that position. Some of them may win, or the winner may not yet be in the marketplace. The extent to which they’re able to scale is the degree of leverage they have over providers.
Put frankly, someone is building a better mouse trap than you have so they can sell (who would have been) your own patients back to you.
Many have tried and not (yet) succeeded, but it would be hubris to think that others won’t.
Here are some of these players now, and what they’re up to.
Important disclaimer: Neither I, nor Fertility Bridge, have a direct commercial relationship with these companies at time of writing, though we certainly may in the future. No information in this article comes from conversations that I have had with the executives of these companies. This profile is not a revelation of insider knowledge. Rather, it is a curated synopsis of public information. My observations and opinions are exactly those, based on information that has been publicly released by these companies or covered in the press.
CONSUMER APPS:
GLOW
The tech-forward platform for serves fertility patients and connects them with clinics by providing:
Glow- Ovulation and fertility tracker
- Includes:
Fertility Calendar
Daily health log
Health insights
App syncs with partners app
Glow Nurture - Pregnancy app
Glow Baby - Baby Tracker
Eve by Glow- period tracker and sex tips
Glow Fertility is segmented into a direct-to-consumer programs and a separate employee benefits program.
Direct-to-consumer programs:
Glow predicts ovulation patterns and fertility probability based on user data inputs and supports women with services such as egg freezing and IVF. In addition to helping clients navigate the process of getting pregnant, Glow also facilitates access to healthcare providers (with whom the Glow team negotiates discounts to reduce the financial burden of historically expensive fertility treatments).Employee benefits program:
On the employer side, the Glow Fertility Program negotiates contracts between employers and fertility care providers.
Millions of women input data on menstrual periods, doctor visits, sleep habits, sexual activity, and birth control (in addition to over 35 additional basal health data points), and Glow has all of that data.
Although Glow does not publicly share the full details behind it’s business model, the firm charges businesses for the employee benefits program, and is also able to charge a fee for facilitating access to services from preferred healthcare providers. Glow also offers women personalized consultations through its direct-to-consumer channel, offering one free session before converting to a charge for service model.
History and Funding:
Launched in 2013 by Max Levchin (co-founder of Paypal)
Glow originally spun out of PayPal Co-Founder and CTO Max Levchin’s business incubator, HVF.
According to Crunchbase, Glow has raised over $23 million in venture capital, $17 million of which was raised in a 2014 Series B round that included Founders Fund and Andreessen Horowtiz, reports Vox.
EMPLOYEE BENEFITS:
CARROT
Carrot is a startup out of Y Combinator working with employers to offer fertility care like egg-freezing and in vitro fertilization (IVF) as a workplace benefit.
Provides affordable options for those struggling with infertility by partnering with employers to add coverage for fertility services. They offer customizable plans to employers to include varying levels of fertility coverage at a sliding, per-employee dollar amount.
Founded by:
Tammy Sun, CEO
Dr. Asima Ahmad, Medicine
Juli Insinger, Growth
Arun Venkatesan, Engineering
Funding:
Total funding: $15.2 million
According to CrunchBase, Carrot has raised $15.2 million over four rounds, one angel, two seeds, and a series A. Their lead investors have been UnCork Capital with 3.6 million and CRV with $11.5 million.
Their family planning concierge, which reports to provide members with caring, live guidance, and support at every stage of the journey.
Help for members maximize existing benefits.
Access to preferred pricing at top clinics and pharmacies.
Access to customized fertility payment options.
Nubundle offers its products as a voluntary employee benefit, limiting the costs to employers. Employers pay a flat annual admin fee.
Founders
Chris D'Cruz
John Ciasulli
Total funding: $1.5 million
In a seed round, NuBundle raised $1.5 million from three investors led by Lightbank.
STORK CLUB
Family/fertility benefit suites for companies.
In 2018, Stork Club expanded their core offering by introducing a comprehensive suite of Flexible Family Benefits that include both Fertility and Parental programs designed for large enterprises.
Stork Club advertises to be the only enterprise-ready family benefits provider designed for self-funded employers. They process claims and pay providers directly, letting your team focus on more important goals.
They have employee-facing web and mobile apps to help employers on-board, manage, and validate new programs with vetted provider partners.
Founder, CEO: Jeni Mayorskaya
Early Stork Club investors and advisers include key employees from LinkedIn, One Medical, and Facebook .
They appear to be funded by slow ventures, but it is unknown how much money they have raised.
PROGYNY
Right now, Progyny is the fertility benefits company.
They provide fertility solutions for self-insured employers.
Some may remember, Fertility Authority, the consumer facing company and fertility clinic review platform that negotiated reproductive health benefits. The company changed its name to Progyny in 2015 after acquiring, or being acquired by, Menlo Park-based Auxogyn, the inventor of Eeva. They quickly sprinted ahead to lead the race of fertility benefits broker.
In my opinion, this is a one-horse race at the moment, with their young, new competitors looking to be the person who can disrupt their early lead as Lyft did to Uber.
Founded in 2008 as Fertility Authority, became Progyny in 2015
CEO: David Schlanger
Headquarters are located in New York, New York
Funding:
Total funding: $99.5 million in ten rounds from six investors, as documented by CrunchBase,
Who led the rounds has not been released.
Though we do know they raised $15 million in a new round in 2016.
THE FINANCIERS
Now this group is different. They’re not a new wave of tech companies launched from or by Silicon Valley serial entrepreneurs. However, by default, they do serve as lead generation and another entry point for patient acquisition from which they can bring new patients to fertility centers.
Also, I speculate a potential scenario in which one or more of these companies are acquired for easier, quicker, and more expansive entry into the fertility field.
Think about it. Many of these companies have an outdated user experience and some of the founders may be ready to cash out of the game rather than reinvest and overhaul. Again, this is Griffin Jones putting his Jim Kramer hat on and being purely speculative.
WIN Fertility:
Maybe they belong in the employer benefit group, but a few things set them apart:
They have been in the field for two decades.
WIN offers benefits through employers and affordable options for treatment through practices for those without insurance or for those who have exhausted their insurance benefits.
WIN integrates with national and regional insurance carriers, as well as the nation’s largest pharmacy benefit managers to procure fertility services. WIN patients are qualified prior to fertility treatment.
Available 24 hours a day, 7 days a week, WIN’s Nurse Care Managers guide patients through every step of their fertility journey.
Originally founded as an independent women’s health management company
Founded in 2000
President and CEO: Roger Shedlin
Attain Fertility
ATTAIN FERTILITY:
Attain makes themselves known for being the original multi-cycle plan provider. They offer bundled IVF cycle plans, called Multi-Cycle Discount Programs, that include multiple IVF cycles for a one-time, discounted fixed fee.
Being owned by IntegraMed they are affiliated with 40 practices, 130 locations, and more than 180 Reproductive Endocrinologists in their US wide network.
Some patients qualify for their Multi-Cycle Discount Program + REFUND. This offers patients who meet certain criteria the potential of getting a refund if their IVF cycles are unsuccessful.
$15.4 million
Founded by Pam Schuman
ARC Fertility
ARC says they are the access point to the “nation’s largest network” of fertility professionals and offer innovative financing options.
More specifically, ARC offers fertility treatment packages, refund guarantees, and finance options to people living with infertility.
Value proposition to clinics and/or patients:
Largest network
Most trusted
Doesn’t own/operate clinics -> looking out of patients best interest
ARC’s fertility care packages can be bundled with medication and genetic testing services and bundle the cost of services into one monthly payment.
History:
ARC was founded by David Adamson, MD.
THE WILDCARD
Fertility IQ
The most comprehensive review platform for fertility specialists and fertility clinics.
With FertilityIQ, prospective patients search by location or by a specific doctor or clinic name. Doctor profiles are detailed with aggregated metrics including communication quality, degree of individual attention, responsiveness, and overall recommendation. Patients’ summarize their experiences with doctors and clinics -- from the doctor’s approach to diagnosis and treatment protocols, to the nursing staff’s level of organization, to the competence of the clinic billing department.
History and Funding:
The founders of Fertility IQ, Jake and Deborah Anderson-Bialis, say they will never take marketing dollars from clinics. Rather than seek capital from outside investors, the couple decided early on to self-fund FertilityIQ.
Founded in 2015, went live in 2016
One of my clients once told me that they were weary of Fertility IQ because they thought they were building a mousetrap and they didn’t know what it was. I’m not weary because I believe Jake and Deborah have built their platform from an authentic ethos and are serving the market in a genuine and desperately needed way. Where the mousetrap will lead, I have no idea but it’s already a darn good one. Fertility IQ offers the best user experience for fertility clinic selection and has some of the best consumer generated data in the field.
Conclusion:
Up to now, I have presented private equity backed consolidation and venture capital backed innovation as two separate phenomena, though they certainly don’t have to be. What will happen when the largest fertility networks, their parent companies, or private equity firms, acquire the largest scale platforms for patient acquisition, financing, distribution etc? Vise versa?
Resilient businesses survive revolution and later thrive because they adapt to capitalize from these disruptive forces rather than be replaced by them. There is more opportunity for the independent REI practice than there has ever been before, but it isn’t coming from doing business the same old way. It requires new strategy, paying close attention to the new players in the market, and using them for their benefit.
If you would like help in adapting to these forces and benefiting from the disruption rather than being pained by it, learn more about how to implement the Fertility Marketing System.