Can a Smartphone-Based Ultrasound Raise $4 Million?
BY J.J. McCorvey
Elevator Pitch: Mobisante created a hand-held, affordable, cloud-based ultrasound system. Will it be able to raise the money it wants to develop a tablet-based product?
Can Your Phone Do This? Mobisante co-founders David Zar (left) and Sailesh Chutani with their portable ultrasound device.
Co-Founders: Sailesh Chutani and David M. Zar
Location: Redmond, Washington
Founded: December 2009
Product Launched: October 2011
2012 projected revenue: $1 million
Cost: $7,500–$8,000 per device, depending on customization
Number of confirmed orders: Five
Previous funding: $700,000 from angel investors and community clinics; $400,000 in seed funding from venture firm WRF Capital
Funding sought: $4 million
The Pitch: "Ultrasound imaging is safe and effective, but its use is limited, because existing systems are big, expensive, and hard to use. Mobisante has filled this need by creating a hand-held, affordable, cloud-based ultrasound system built from a standard smartphone. Doctors can use our device to increase the range and accuracy of the procedures they perform; radiologists can remotely provide diagnostic services via the platform's cellular or Wi-Fi connectivity. We're raising money to develop a tablet-based product, build a back end for cloud-based storage and collaboration, hire an executive team, and obtain certification to sell in Europe."
The Experts Weigh In
Don't forget Training
Mobisante needs to figure out how to get doctors trained and motivated to use the device. Radiologists and ob-gyns are familiar with ultrasound equipment, but primary care doctors generally are not. It's not clear to me how Zar and Chutani will have enough profit margin to cover the cost of training, which is very important. If doctors don't use the product accurately, the broader market is not going to adopt it. The technology is really interesting, but we don't invest in cool technologies. They've got to show that this is also a great business.
Ross Jaffe | managing director | Versant Ventures | Menlo Park, California
Focus on Portability
There's clearly a utility for a hand-held ultrasound device, but I don't know how important mobile connectivity is to doctors on the frontline. What sells the product is its potential to dramatically lower the cost and footprint of ultrasound devices. This is something doctors can stick in their lab coats and carry around. Mobisante should tout the device's small size and market it as the 21st-century stethoscope. It's hard to say if $4 million is enough to go fully commercial, but it seems pretty low.
Myles Greenberg | General partner | CHL Medical Partners |Stamford, Connecticut
Security is Critical
I'm concerned about security, both on the device and when data is transmitted into the cloud. Medical devices are generally confined to hospitals, where all equipment is under the control of the IT organization. But Mobisante's device could easily be lost. Because of this and health care regulations like HIPAA, a lot of compliance needs to be built into the software. That could be costly, so Zar and Chutani should be investing in this now. That said, I really believe in the long-term trend this represents and would absolutely consider this investment.
Dan Scholnick | general partner | Trinity Ventures | Menlo Park, California
J.J. MCCORVEY is a reporter at Inc. magazine, where he covers a wide range of topics, including technology and business research. He has covered metro news for The Detroit News, and his work has been featured in Men's Fitness. @jmccorvey