As we continue to highlight the top 10 deals of 2022 in the women’s health and sexual health space, we look into another important category of M&A: late stage venture-backed companies growing through mergers with, and/or acquisitions of, other companies.
The concept of late stage venture-backed companies acquiring other startups is not new. But, until the last few years, these transactions were infrequent and only between big-name companies (e.g. Facebook acquiring Instagram in 2012 and GrubHub merging with Seamless in 2013). Now, they are becoming a common trend. In fact, over half of all acquisitions in 2021 were venture-backed companies buying other venture-backed companies and we are seeing this happen in the women’s health and sexual health space.
All companies know the growth challenges of launching new products and services, reaching new markets and demographics, hiring and retaining the right employees, etc. Companies that acquire robust startups circumvent some of these challenges, allowing the acquirers to scale seemingly “overnight”.
In 2022, we saw major valuations in the women’s health and sexual health space as late stage venture-backed companies grew through mergers and acquisitions of other companies.
Top Deals of 2022
The next 3 deals in our top 10 of 2022 demonstrate this trend:
3) Nurx merges with Thirty Madison in February 2022
Prior to the merger Thirty Madison was valued at over $1B and Nurx was valued at $332M.
Founded in 2015, Nurx offers services for contraception, sexual health and general health. Thirty Madison (founded in 2017) offers virtual care for patients with chronic conditions. Nurx will now operate under Thirty Madison. This partnership will double the number of conditions each company covers, allowing for future scaling, payer partnerships and care.
4) Ro acquires Dadi for $100M in March 2022
Ro, founded in 2017, is a digital healthcare company focused on sexual health and fertility. After its most recent raise in 2022, Ro is valued at $7B.
Ro bought Dadi, a sperm collection and testing startup, to grow Ro’s fertility offerings to include at-home kits for men.
This comes after Ro acquired Modern Fertility (May 2021), and Workpath (December 2020) to expand its suite of fertility services and enable a more seamless combination of in-person and virtual care.
By acquiring Dadi, Workpath and Modern Fertility, Ro set itself up for success as a leading virtual healthcare company with tech-enabled, in-home health services.
5) Kindbody acquires Vios Fertility Institute (February 2022), Phosphorus Labs (June 2022) and Alternative Reproductive Resources (August 2022) and exceeds a $1B valuation
Founded in 2018, Kindbody offers fertility treatments (IVF and egg freezing) and family-building services. With a recent post-money valuation of $1.2 billion, they have reached unicorn status, in part thanks to their acquisition of three key companies.
By acquiring Vios Fertility Institute, Kindbody doubled their U.S. footprint to 26 clinics and can expand to 40 retail locations by Q4. The addition of Phosphorus Labs, provided Kindbody a state-of-the-art reference laboratory to bring their genetic testing and screening in-house. Finally, Kindbody’s acquisition of Alternative Reproductive Resources (ARR), a leading gestational surrogacy agency, brings their surrogacy services in-house, creating a more seamless patient care experience. Kindbody is expected to go public next year according to Kindbody Chair, Gina Bartasi.
This Trend in Recent Years
This trend has been prevalent in the women’s health and sexual health space in recent years. Back in 2021, Everlywell acquired PWNHealth which put them at a $2.9B valuation. In 2020, Maven Clinic acquired Bright Parenting and is now valued at over $1B. As mentioned above, Ro made a couple acquisitions in 2020 and 2021. No doubt, women’s health and sexual health companies will continue to grow through strategic acquisitions in the years to come.
The Next Companies to Watch
Amboy Street portfolio companies, Hey Jane and Dipsea, are both strong acquisition targets for late stage venture-backed companies.
Hey Jane provides stigmatized women’s telehealth services starting with abortion medication. Scaling telehealth abortion access is no easy feat with strict laws and regulations as well as very specific practitioner onboarding. Hey Jane can seamlessly bring this service, along with its other unique telehealth service offerings, to a late stage telehealth company through an acquisition.
Dipsea is a subscription app offering female and LGBTQ+ focused audio erotica. Dipsea’s audio erotica content library could be an interesting addition to the late stage companies that have mindfulness content libraries like Calm and Headspace, or an addition to the late stage female-focused pornography site, Bellesa.
Overall, Amboy Street is excited to see this continue to be a viable exit paths for women’s health and sexual health companies. Keep an eye out for our next blog post in this series that will highlight another M&A trend and more top deals in the women’s health and sexual health space in 2022.
