What’s Behind the Merger of Lexie & Eargo? Interview with LXE Hearing CEO Nic Klopper

The recent merger of hearX, best known for its Lexie Hearing brand, and Eargo, a pioneer in sleek, invisible over-the-counter (OTC) hearing aids, has created a new company: LXE Hearing.

As reported by HearingTracker on Monday, Eargo and hearX (owner of Lexie Hearing) are combining forces to create LXE Hearing with the help of $100 million in new funding from the healthcare investment firm Patient Square Capital. LXE Hearing aims to become a leading force in hearing healthcare.

HearingTracker sat down with Nic Klopper, cofounder and CEO of hearX and now CEO of LXE Hearing, to talk about how the merger came about, what it means for the companies’ respective brands, and how LXE plans to navigate a rapidly evolving hearing healthcare landscape.

HearingTracker: Can you tell us a little about the origins and rationale for the merger between hearX and Eargo?

Nic Klopper: Absolutely. The story really starts a year ago when Eargo went private. Before that, hearX had always looked at the OTC category and evaluated potential partners with complementary product lines as a potential avenue for expansion. We have long viewed Eargo as one of the top innovators in the space. They've been trendsetters and learning lessons before the rest of us.

Lexie’s product line consists of receiver-in-canal (RIC) and behind-the-ear (BTE), which are the most popular styles of hearing aids and can offer consumers a lot of high-tech features. But we have always been intrigued by Eargo’s invisible in-ear hearing aids, which also have great technology and appeal to a younger demographic.

Once Eargo went private, this created an opportunity to talk with their sole investor, Patient Square Capital, who also happened to be interested in combining the two companies. After a few meetings with their management and backers, it became clear how strong the synergies were, especially in product development and market reach.

HearingTracker: Rightly or wrongly, Lexie is sometimes viewed as a standout in OTC hearing aid sales, marketing, and customer support, while Eargo is more associated with its product and a Silicon Valley tech innovator. Is that accurate—and does it help explain why the merger makes sense?

Klopper: That’s somewhat fair. Lexie has focused on developing a world-class platform and relied on partnerships with companies like Bose and Intricon for its technology. Eargo, on the other hand, has a strong R&D team, and they develop all their own products. It was really appealing to us when we looked at this and all the other pieces and realized both companies have different skill sets.

Our market strategies also differ: Lexie has been stronger in third-party retail channels, while Eargo has excelled in direct-to-consumer (DTC) sales. I think we recognize that we can learn from each other in this regard. The synergies and complementary nature of our strengths made the merger a clear win.

And then, of course, there was interest from Patient Square Capital, which saw this market growing at a very good rate since the FDA OTC Hearing Aid regulations in October 2022 and wanted to go deeper with its investment in hearing health.

HearingTracker: It sounds like you’re keeping both the Eargo and Lexie brands. Can you explain that strategy and how they work within LXE Hearing?

Klopper: Yes, absolutely. The LXE Hearing name is a corporate umbrella—"L" for Lexie, "X" as a multiplier, and "E" for Eargo. But we’ll continue using both consumer-facing brands, Lexie and Eargo, which have earned a lot of consumer trust. We’re also retaining the hearX name for our professional products, like our automated hearing screening equipment.

All of the brands are built on strong credibility, and there’s no need to change something that works.

HearingTracker: Where will LXE Hearing be headquartered?

Klopper: The headquarters will be in San Jose, California.

HearingTracker: And you’re keeping much of the executive team from both companies?

Klopper: Correct. This isn’t a new leadership team. The executives from both sides bring deep experience. LXE Hearing’s Chief Strategy Officer, Seline Van der Wat, has been with Lexie for eight years. Emanuel Gerson, who will serve as CFO of LXE, has three years with the company. Industry veterans like COO Bill Brownie and CTO Tim Trine from Eargo bring decades of hearing industry experience, and Brian Maguire has been with hearX for three years and in the audio business for about 25 years.

Our executive team knows hearing aids. When you just look at the combined histories of hearX and Eargo, there are 25 years of hearing industry expertise. That’s a big part of what excites me.

HearingTracker: By my round estimates, Patient Square Capital (PSC) has now invested somewhere around $240 million into Eargo and LXE Hearing. How much do they own, and what is their role moving forward?

Klopper: I can’t comment on their exact ownership because we’re a private company, but they are heavily invested in our success and absolutely have a seat at the table. PSC has seen what we've collectively built in the two companies, and they’ve really been supportive of our team’s vision for the future and where we want to lead the company. They've been absolutely great partners in supporting management and our vision.

HearingTracker: Eargo had its share of financial struggles. How did that play into the merger?

Klopper: It’s hard for me to speak on Eargo’s internal motivations. But from my perspective, Patient Square Capital saw an opportunity to grow both companies’ presence in the hearing health market. There are significant synergies—on both the cost and revenue sides—that made this merger attractive for all parties.

HearingTracker: Eargo and Lexie have been committed to using telecare for onboarding new clients, as well as ongoing customer support and guidance, but those activities are pretty expensive. Are you looking at some consolidation with this or other facets of the business?

Klopper: Our plan is to lean into what each company does best. We want to be smart with capital. Both Lexie and Eargo have always believed in providing strong support for our customers. Telecare remains a key part of that. And yes, we’re also looking at how we can be more efficient across functions like supply chain, product development, and support while enhancing the customer experience.

I actually think there's going to be very little cannibalization of the two companies coming together; rather, there’s a lot of upside potential. But it’s also important for us to be conscious of the capital that's injected into the company. We need to make sure we invest in the right initiatives. Our mantra is not growth at all costs, but instead to build a sustainable and profitable business that results in a satisfied and loyal customer base.

HearingTracker: What can you tell us about future product development at LXE Hearing?

Klopper: Product development is central to our growth strategy. Both companies have always been data-driven—our decisions are rooted in real-time customer feedback.

Now, for the first time, we have a company with deep expertise in both hardware and software. That’s powerful. We’ve already mapped out a busy product roadmap for 2025 and 2026. We’re working on some groundbreaking technologies, and we’ll soon be launching upgrades to the Lexie app and new Eargo products.

HearingTracker: You've both invested heavily in research and done a lot of validation on your products. Will that continue?

Klopper: Without a doubt. Between Eargo and hearX, we’ve collectively published over 60 peer-reviewed articles. A data-driven approach will remain a key differentiator for LXE Hearing. We’re committed to evidence-based innovation—not just marketing spin. That’s essential for gaining the trust of consumers and professionals alike.

HearingTracker: The hearing industry seems to be in a bit of a soft patch lately. What’s your take on this?

Klopper: Consumer confidence is definitely low, and spending is down across the board in virtually all consumer segments. But we’ve seen great growth in OTC since the FDA ruling in 2022. What’s key is understanding the ebbs and flows of consumer spending and adjusting acquisition strategies accordingly. We’ve been seeing the best unit economics in months. So, we’re optimistic—but cautious.

HearingTracker: What excites you the most about this new chapter with LXE Hearing?

Klopper: There’s so much I could list, and I think our executive team might give you several different answers because there are a lot of exciting facets.

What excites me is that, for the first time, I feel we've got a complete product solution that hits different price points and form factors for consumers that previously we've not had access to. This not only broadens choices for consumers, but also helps us with our supply chain, third-party sellers, and more.

Another piece that excites me a lot is all the work that Eargo has put into their upcoming product launches, which I think is extremely groundbreaking. And Lexie has spent the last year and a half planning our next product launch and the upgraded Lexie app.

So, I think in combination with new capital, innovative products, a strong platform, and an incredible team, it really differentiates and sets us up for growth. And I think when speaking with employees from Eargo and Lexie, they agree we're really looking forward to having a strong growth mindset—doing this now and taking on our competitors. We now have everything we need to be able to do this.

HearingTracker: Do you have any interest in the prescription hearing aid space?

Klopper: I think there’s a lot of confusion among consumers between OTC and prescription hearing aids. Most people just want to hear better.

That said, our focus remains on OTC for now. We do recognize the value of hybrid models and might explore that in the future. It’s not entirely foreign, since Eargo already offers prescription products [Eargo 7 Rx and Eargo SE Rx], but for now, OTC is our core focus.

HearingTracker: I know you’ve been intimately involved in Lexie and hearing healthcare for years, but I’m wondering if this is an exit strategy for you personally?

Klopper: Not at all. This is something I live and breathe. I’m in this for the long haul, and I’m hoping our executive team and employees feel the same way. We’re building something meaningful here—delivering hearing health to everyone, everywhere. It’s an incredibly important mission, and I’m really excited to be a part of it.