Tech Healthcare unicorn Ro announced today that it has raised $150 million exclusively from existing investors, led by ShawSpring Partners, with participation from FirstMark Capital, General Catalyst, Seven Seven Six, BoxGroup, Altimeter Capital, Baupost Group, Initialized, TQ Ventures and TCM. Sources close to the company, as well as Bloomberg, confirm the money was raised at a valuation of $7 billion.
The company did not immediately respond to requests for comment.
An inside round up for a unicorn—which has endured much of the battle and attrition—can mean a few things. First, the fact that Ro was raising exclusively from investors who already have financial interests in the company’s future success, rather than an outsider recently convinced, may indicate that the funding event was not the result of a major roadshow.
Existing investors clearly doubled — pushing Ro’s valuation from $5 billion to $7 billion — but the lack of participation from new investors is still surprising. Notably, the new round is less than the previous round, a $500 million Series D that closed in March 2021.
The money doesn’t come without change. We know that in the last 12 months Ro has made an acquisition, acquiring Workpath, Kit and Modern Fertility. As I wrote in November 2021, Ro is also in talks to acquire Dadi, an in-home sperm storage startup, at an estimated value of around $100 million. Ro didn’t immediately respond to the request for comment, but in the post announcing the funding round, CEO and co-founder Zachariah Reitano said “male factors sperm analysis” is currently a gap in the platform’s service.
“Although we have fertility tests for people with ovaries, we don’t have male factor semen analysis. While we have the ability to test a patient’s cholesterol, A1C or testosterone, we can’t treat them yet,” he wrote. “We can’t automatically track their progress with remote patient monitoring. We can’t do as much of what we want to do for patients and it won’t all happen tomorrow. We don’t even have a mobile app.”
If that’s the case, Ro seems to see the funding as yet another way to be abusive and to deliver his vision of creating a patient-centered health care system. If the company is still going through some growing pains, a new valuation could put new pressure on a company that is under more pressure than ever to create new verticals.
Ro’s closest competitor, Hims & Hers, has struggled in the stock market since its debut, but added $57 million to its market cap in the past seven days, according to Nasdaq.