How We Started A $150K/Month Male Fertility Company That Offers Sperm Analysis And Storage
Hello! Who are you and what business did you start?
Hi, I’m Khaled Kteily, a founder based in Boston with roots in Canada, Lebanon, and Palestine.
I founded Legacy, a fatherhood company, in 2018. Our goal is to destigmatize the topic of male fertility and create an accessible, convenient, and private option for all men thinking about their fatherhood journey.
Of course, a sensitive topic can also be quite taboo, and there’s a reason my friends call me ‘The Sperm King.’ (Netflix, I’m thinking this is your next show?). What we’re doing is changing the outdated view that fertility is a “women’s issue” and rebalancing the gendered expectations around family planning.
Our primary offering is a mail-in kit, effectively combining an at-home sperm testing kit and cryogenic storage of sperm.
Our customers can purchase the ‘For Today’, ‘For Tomorrow’, or ‘For Forever’ packages, depending on how they are thinking about their family planning journey.
Our base product is $195 and includes a complete semen analysis, short-term cryogenic storage, priority overnight shipping, personalized recommendations, and a Client Service Advisor who guides you through the process.
Our products go up to $3,995 for the ‘For Forever’ package, which includes lifetime cryogenic storage, stored across multiple geographic sites and locations as well as priority access to our latest research and development via our Legacy Lab.
So who are our customers?
Our customers are thinking about fatherhood, whatever that means to them. So who are they?
Men who ultimately choose not to have children but want to preserve the option.
Young millennial couples who plan on having children later in life and want to protect their best assets before they deteriorate.
Men who are struggling to conceive and are looking for ways to improve their sperm count.
Military men, some of whom are already fathers, who are leaving their families for the front-line and want to ensure if anything happens to them they leave behind a legacy.
Men battling cancer, those planning to undergo a vasectomy, or folks planning on transitioning to become a woman - they all turn to us for our analysis or storage products.
Since starting, we’ve grown by leaps and bounds. The number we report to our investors is revenue, and we’re averaging $150,000 in monthly revenue. But that number doesn’t mean much to me; I care about building an industry-defining company, and building a sustainable, long-term, profitable business is a critical part of that.
We just shared our new brand, and one of our core brand ideas is ‘Just Bring Yourself.’ Because fatherhood is a universal language, and we want to meet men where they are, however, and whenever they’re ready.
What's your backstory and how did you come up with the idea?
Believe it or not, I didn’t grow up dreaming of running a male fertility company. I don’t think most people do. But I always had had a deep interest in healthcare, and have held this strong belief that doing anything substantive in the world means doing something completely different.
It was a personal experience that drove me to the world of fertility. Years ago, a close friend of mine found out he had cancer, and he froze his sperm before beginning a chemotherapy process that would likely leave him infertile.
I had never heard of the concept of sperm freezing before that moment, but I had spent years working in Health & Life Sciences Consulting at a management consulting firm, Oliver Wyman. It triggered me to learn more about something that most of us, especially men, keep buried. I took coursework and eventually joined the American Society for Reproductive Medicine.
The more I learned the more shocking the statistics seemed: male fertility has declined by 50% in the last 40 years, and you’d never know from the way we speak about it that men have a biological clock, too. I went to fertility centers to test and store my sperm, and the experiences were so clinical and awkward that it was no surprise men would rather avoid the topic altogether than have to ‘provide a sample,’ alongside others, rushed, in a small room.
I thought there had to be a better way. I realized that we could use technology to allow men to have their fertility tested and sperm are frozen from the comfort of their own homes. I laid the groundwork for Legacy in 2014, setting up a test website, but a company working to normalize the conversation around male fertility would have been too early then. For a company like this, it’s all about timing.
At the Harvard Kennedy School, I studied health policy and public policy. I also worked as a healthcare consultant at Oliver Wyman, then for the UN and the World Economic Forum. In 2017, a major new study came out showing the massive, generational decline in male fertility levels over the past half-century, and I knew it was time. I poured all my savings in, and I got to work.
If you want to start a company, find a problem you want to work on solving for at least the next five years. I mean, really, find a problem that you can’t stop thinking about.
Take us through the process of designing, prototyping, and manufacturing your first product.
This was actually extremely difficult. I had to reach out to my entire network to get connected to the types of agencies that could with the design, prototyping, testing, and manufacturing that we needed to be done.
Finally, I found an amazing industrial design agency in Europe that was willing to take a bold bet on us and worth it with an unknown start-up to design, prototype, test, and manufacture the product. Here, a warm introduction made all the difference.
Today, having been a founder for over two years and being part of the Y Combinator community, that process would be totally different. This is the kind of question you can ask in the Y Combinator Slack - or to your network of other entrepreneurs - and get an immediate answer to. “Who should we work with for manufacturing?” “Here’s a pre-screened list of 20 agencies across the world.”
Here’s how our first product looked like, once ready to launch:
Describe the process of launching the business.
I paid for the product development using all my savings. In our business, you can’t move fast and break fast. You have to move without breaking anything.
We needed to spend a lot of time testing every part of the experience to make sure we wouldn’t leave customers disappointed and that we checked every box in healthcare best practices. When I thought I was ready, I made my closest friends and family try and buy the first kits. Then I iterated on the process, on the emails sent, on the formatting of the analysis presented with the feedback I got from them.
It took about a month for us to get our first ‘real’ sale. For the first couple of months, whenever we got a sale, it was big internal news. I remember how hard it was to do things. The team was tiny, so I juggling manufacturing, design, legal, HR, and even just the emotional challenges of building something new with a vision that others just hadn’t come around to yet.
But when you care so much about solving a problem, keep your ear to the ground with your customers, and are laser-focused around a market opportunity, good things will happen. We narrowed our focus on upholding our values, developing credibility, and building a brand.
And good things did happen. We secured some of the world’s best fertility experts as advisors. Harvard accepted us into their prestigious Innovation Labs. Then we got into Y Combinator, won TechCrunch Disrupt, and scored gold at MassChallenge.
Sales came in and investors, believing in our vision, began knocking on our door. It was a virtuous cycle that fed itself and we’ve been very lucky that we’ve been able to keep it going. We’ve been financing the business with those grants and investor capital and expect to until we are profitable.
When you start a business, you control everything and make it move to your own speed. When you grow, you need to invest time to train your team to do specific tasks better than you can.
Since launch, what has worked to attract and retain customers?
When you’re trying to create a new market like we are, educating your prospective customers is your top priority. If you don’t do it well, you don’t have a market and you won’t have a business.
If there’s one thing I’ve learned, it’s that it’s impossible to predict where customers will come from or what will resonate with them. You have to try the channels first and talk to every customer you can.
We’ve found designing experiments, testing with small budgets, and ramping in those channels when we see them working is the way to go. The truth is we’re still learning new things every day about how to sustainably attract and retain customers at the target CAC we set for ourselves, from trying to channels to changing our messaging.
To first reach customers, we needed a multi-pronged education strategy. We couldn’t just put advertisements in front of potential customers and hope they’d buy our product. No one would bite. First, they had to learn and believe that there’s a problem with male infertility. Next, we need to motivate them to personal care. That’s really hard because this stuff is still taboo in our society.
Then we need those prospective clients to know that they can trust what we do - because the company that wins their business has their personal health and privacy at stake. This is all before they see the price, the various offerings, and before we see even a single sale.
Early on, we made the strategy to invest in the content on our own website.
We did this because credibility is so important and because good information on male infertility is so sparse online. We felt these early investments in resources and research would compound over time.
Now, we write half a dozen posts a month and have pretty comprehensive guides - a Sperm Overview Guide, a Sperm Quality Guide, a Guide on Supplements, a Guide for Military Members, a Guide for Cancer Patients, a Guide on Future Treatments, and a Guide on ICSI, a procedure to inject sperm into an egg. While these guides get traffic and build our credibility, we’ve found some of the more timely posts end up getting more visibility.
For example, our authoritative post on how COVID-19 affects male infertility is our most viewed post ever by an order of magnitude and ranks higher than the CDC on Google.
What we realized pretty late on is that content on its own is not enough. We’ve been focused on engineering our content to fit what customers are searching for and to make sure we’re at the top of those searches. What we’ve found effective is highlighting that website content through our other channels - as well as having media reference it. You’ll see a lot of that in this post!
Recently we’ve been experimenting a lot more with paid advertising. We do Facebook, Bing, and Google Adwords and we experiment with different audiences, messaging, and visuals to see what works best. It’s on everyone’s mind these days, so I’ll just say it: we don’t advertise or post our product on Amazon. While we know we could sell more kits in the short term, we’re not sure we could do so profitably and without burning the brand credibility we’ve built. Amazon works for some e-commerce businesses. For ours, it just doesn’t work.
How are you doing today and what does the future look like?
Our operations have evolved a lot. Today we service customers across the entire country. We partner with 7 world-class fertility clinics across the United States to make sure we can analyze and store our clients’ sperm securely, privately, and extremely quickly. Recently, we announcedwe’re opening up an R&D laboratory to augment that work, and we’re extremely excited about it.
Actually, we had a number of announcements that week. I announced I’m funding projects that research the link between COVID-19 and male fertility up to $25k in grants. We announced that we’re giving free kits to cancer patients and free cryostorage for all new clients until the COVID uncertainty wears away. We launched our new telehealth product. In the same week, we even launched our new brand. It was a busy week.
As we mature, we aspire to be trusted as the fatherhood company. We want every dad to think of us when they need help. We want to serve all fathers at every stage of their journey into and through fatherhood. Operationally, this will mean an unroll of new products, an expansion of acquisition channels, and launch into new markets. Because this growth is an upfront, capital intensive investment, we may not be net profitable for several more years.
Through starting the business, have you learned anything particularly helpful or advantageous?
The single most important thing I’ve learned is that I can’t do everything. Learning to delegate is something I’m still improving on. When you start a business, you control everything and make it move to your own speed. When you grow, you need to invest time to train your team to do specific tasks better than you can. It was so hard for me to train myself into the mindset my growing business needed me to adopt. I wish I had sooner - we’re seeing the benefits of it right now.
One of the best decisions I’ve made here is investing in an executive coach, who has been working with me now for over two years, and executive coaching is now something I offer everyone on my team as an employee benefit.
The second most important thing is to tell the world what you want. The people around me genuinely want to help - I’ve had to learn to tell them what’s on my mind, and I’ve found the world is a lot smaller than I thought. People have come through in surprising ways, be it through investing in Legacy, connecting me to the people I’ve needed, or giving me ideas I never otherwise would have considered.
What platform/tools do you use for your business?
Let’s run through our tech stack quickly. Whenever possible, we prioritize privacy - both ours and that of our clients.
For example, we consolidate our communication in Slack, but still, use Signal to discuss any sensitive or confidential information. The team uses LastPass to auto-generate passwords, set up two-factor authentication for all tools, and run an ongoing anti-phishing campaign through a company called Riot. We use Tresorit to share sensitive documents but will also use Dropbox for public-facing information.
And then of course, everything needs to be HIPAA-compliant. As a company, we are HIPAA-compliant, GDPR-compliant, and CCPA-compliant, to make sure we’re always in line with the strictest standards around privacy and data security.
We also use customer-facing or customer-focused tools like HubSpot, OpenPhone, Front, and Intercom.
What have been the most influential books, podcasts, or other resources?
My book collection has evolved through my career, and the past few years have taken on a starkly entrepreneurship-focused color. I love the first third of Ray Dalio’sPrinciples - an honest and data-driven view on how to build a business. I love Tim Ferris’s Tools of Titans, a bible for how to be more productive and effective with your time. And of course, the classics, like anything written by Ben Horowitz.
And in my previous life, I read the Affordable Care Act cover to cover. Influential is an understatement but talk about dry reading.
Advice for other entrepreneurs who want to get started or are just starting out?
If you want to start a company, find a problem you want to work on solving for at least the next five years. I mean, really, find a problem that you can’t stop thinking about. There are so many highs and lows with starting a business that you’ll only push through if you know your reason for why you’re doing it.
Be open to growth. The truth is that if you’ve never started and grown a company, you’re not prepared for it. You’re going to wear every hat. You’ll first take on every responsibility and then, once you grow, you’re going to learn to let go of every single responsibility you first had. You can’t prepare for it. You can only make sure you’re coachable, that you’re open to feedback from others, and that you evolve as your company needs you to.
Finally, find a circle of friends who are also starting companies. This stuff is hard. It’s a lot easier to recharge and to look after your well being when you have friends around you who understand how much it can suck and with whom you can commiserate with. The group of entrepreneurs I met when I was at the Launch Lab and at Y Combinator - they’re some of my closest friends to this day.
Are you looking to hire for certain positions right now?
We’re fully staffed until we complete our Series A raise in 2021. However, we are scouting for summer and term-time marketing interns. We’re always on the hunt for the very best and the most diverse talent.
They say in your life you really only need to be right about one big thing. If you agree with our market bet or what we’re doing gets you really excited, reach out to me - I’d love to talk.
Where can we go to learn more?
- You can check out our website and all the resources on male infertility in the world.
- I’ve been making a lot of posts on my Medium recently. I like it, and my longer formed thoughts are there. Follow me there.
- I’m active on LinkedIn and getting more active on Twitter. Follow me there and if you want to chat, my DMs are always open!
If you have any questions or comments, drop a comment below!
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