Exo, pronounced “echo,” raised a fresh cash infusion of $220 million in Series C financing aimed at commercializing its handheld ultrasound device and point-of-care workflow platform, Exo Works.
The round was led by RA Capital Management, while BlackRock, Sands Capital, Avidity Partners, Pura Vida Investments and prior investors joined in.
The new funding gives the Redwood City, California-based company over $320 million in total investments since the company was founded in 2015, Exo CEO Sandeep Akkaraju told TC. This includes a $40 million investment raised in 2020.
Ultrasound machines can cost anywhere from $40,000 to $250,000 for low-end technology and into the millions for high-end machines. Meanwhile, Exo’s device will be around the cost of a laptop.
“It is clear to us that ultrasound is the future — it is nonradiating and has no harmful side effects,” Akkaraju said. “We want to take the technology and put it in the palms of physicians. We also want to bring it down to the patient level. The beauty of having this window into the body is you can immediately see things.”
Using a combination of artificial intelligence, medical imaging and silicon technology, the device enables users to use it in a number of real-world medical environments like evaluating cardiology patients or scanning lungs of a COVID-19 patient. It can also be used by patients at home to provide real-time insight following a surgical procedure or to monitor a certain condition.
Exo then adds in its Exo Works, the workflow platform, that streamlines exam review, documentation and billing in under one minute.
Akkaraju said the immediate focus of the company is commercializing the device, which is where most of the new funding will go. He intends to also build out its informatics platform that is being piloted across the country and to ramp up both production and its sales force.
The global point-of-care ultrasound market is expected to reach $3.1 billion by 2025 and will grow 5% annually over that period. In addition to physicians, Akkaraju is hearing from other hospital workers that they, too, want to use the ultrasound device for some of their daily tasks like finding the right vein for an IV.
Once the company’s device is approved by the U.S. Food and Drug Administration, Exo will move forward with its plan to bring the handheld ultrasound device to market.
Zach Scheiner, principal with RA Capital Management, said he met the Exo team in 2020 and RA made its first investment in the Series B extension later that year.
He was “immediately compelled” by the technology and the opportunity to scale. Scheiner also got to know Akkaraju over the months as well as saw how Exo’s technology was improving.
“We are seeing an expanding opportunity in healthcare technology as it improves and costs go down,” he added. “The vision Sandeep has of democratizing the ultrasound is not a vision that was possible 15 or 20 years ago. We are seeing the market in its early stage, but we also recognize the potential. Every doctor should want one to see what they were not able to see before. As technology and biology improves, we are going to see this sector grow.”
