(Bloomberg) -- Gina Bartasi, the founder of the New York-based fertility chain Kindbody, is stepping down from her role as chief executive officer.
Bartasi, who created the company in August 2018, will transition out of the startup “over the next couple of months,” according to the firm’s website. A newly created “office of the CEO” that includes President Gina Bruzzichesi, Chief Financial Officer Scott Bruckner and Chief Business Officer Shilpa Patel will manage operations, Kindbody said. Board member Linda Mintz is also assuming the role of chairperson as part of the changes.
Kindbody has seen its valuation decline from a peak of $1.8 billion in 2023. It has been exploring a potential sale while simultaneously seeking $10 million in bridge financing to maintain operations, Bloomberg reported last week. Kindbody called that report “categorically false.” The company also attempted to orchestrate a funding round earlier this year to raise between $30 million and $50 million, but that failed to close amid investor concerns about its finances, people familiar with the situation said at the time.
This is the second time Bartasi has stepped back as CEO of the company. Annbeth Eschbach took the helm at Kindbody after it bought Vios Fertility Institute, a fertility network with facilities across the Midwest, in 2022. But Eschbach eventually departed. The company had been paying a search firm $750,000 to find a replacement, Bloomberg reported last year, and Bartasi ultimately returned to the post in June.
In a text message following the announcement Bartasi said “this transition has been planned for months.”
Last week, a Bloomberg Businessweek investigation highlighted Kindbody’s role in the “baby project” of disgraced insurance tycoon Greg Lindberg, who appeared to have built a network of dozens of egg donors and surrogates largely through manipulation and deception. The investigation found that a clinic now owned by Kindbody treated almost a dozen of these donors, several of whom told Businessweek they felt conned out of parental rights and payments by Lindberg and betrayed by clinic staff.
In a statement to Businessweek for the Dec. 2 story, Kindbody said it was beginning an internal review of the allegations and that it acquired the clinic after the facility began working with Lindberg. The work continued after the acquisition and Kindbody is still storing embryos for him, according to the Businessweek investigation, based on legal, medical and financial records and dozens of interviews with Lindberg’s former employees, clinic workers, ex-girlfriends, egg donors and surrogates.
Neither Lindberg nor his lawyers responded to a detailed request for comment in late November.
A separate Bloomberg investigation published in October 2023 found understaffed clinics and inconsistent safety protocols contributed to errors — including mislabeled, lost or accidentally destroyed embryos — at Kindbody facilities. It was based on interviews with three dozen current and former employees and patients. The company at the time disputed the characterization that it was understaffed or struggled to staff clinics and labs, though it acknowledged the mislabeling of a patient’s embryos in one case.
Kindbody is one of the largest fertility chains in the US, offering in-vitro fertilization and other services, such as egg freezing and storage. This year, however, the startup has closed multiple clinics, according to Kindbody’s website and emails sent to patients and viewed by Bloomberg. At the end of 2023, it cut its revenue forecast and tried to shore up funding to stem a cash burn that it has described to investors as “material,” Bloomberg reported.
--With assistance from Sophie Alexander.
(Updates with more details on the departure and previous reporting starting in second paragraph)
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