Fa6VCs hope the acquisition will encourage more entrepreneurs, investors and acquirers to enter the young field of brain-machine interface technology
Facebook Inc.’s acquisition of brain-computer interface technology startup CTRL-Labs Inc. suggests the first big breakthrough in the emerging field of brain-computer interfaces could come not in medical technology but in consumer devices.
Investors expect the social-media giant’s purchase of CTRL-Labs which is developing a wristband to enable people to control digital devices with their minds will fuel the development of sophisticated consumer products involving virtual reality and gaming.
Life-science applications for the Faceb48ook Inc. ’s acquisition of brain-computer interface technology startup CTRL-Labs Inc, suggests the first big breakthrough in the emerging field of brain-computer interfaces could come not in medical technology but in consumer devices.
Investors expect the social-media giant’s purchase of CTRL-Labs which is developing a wristband to enable people to control digital devices with their minds will fuel the development of sophisticated consumer products involving virtual reality and gaming. Life-science applications for the technology could follow, they add.
The deal broadly demonstrates the maturation and public support of the entire field of brain-computer interface technology, said Arkitekt Ventures Managing Director Enke Bashllari, including those developing futuristic, invasive medical devices such as her portfolio company Paradromics Inc. and Elin Musk’s startup Neuralink Corp.
“We’re past the hype of brain-machine interface as well as the question of whether it will ever work,”
said Ms. Bashllari, a neuroscientist by training who now invests full time.
“We’ve already seen the number of startups double every year for the past three years, so I’m absolutely confident this will spur more innovation and investments.”
The sector got a boost in February when the U.S. Food and Drug Administration issued guidelines on how to regulate brain-machine interface technology.
At the time, Stanford University engineering professor Krishna Shenoy, who directs the neural prosthetics lab there and is an adviser to CTRL-Labs and Neuralink, said the guidelines were likely issued in response to the increase of such startups.
U.S. brain-device startups closed 38 venture funding rounds in each of the past two years, a high point for the sector to date, according to VentureSource, a data provider owned by WSJ Pro publisher Dow Jones & Co.
Unlike Neuralink or Paradromics, which are targeting medical conditions such as epilepsy and stroke and whose devices require brain surgery to install, CTRL-Labs is working on a noninvasive device for consumer use.
Sensors embedded in its wristband read signals between the nervous system and brain that communicate physical actions, like moving your hand to control a mouse. It then translates those signals into digital code that a computing device can understand.
“It captures your intention so you can share a photo with a friend using an imperceptible movement or just by, well, intending to,”
Facebook Vice President of AR/VR Andrew “Boz” Bosworth wrote in a post announcing the acquisition.
Neither Facebook nor CTRL-Labs could be reached for comment.
Facebook’s reported $500 million to $1 billion purchase of four-year-old CTRL-Labs sends a clear signal that brain-machine interfaces have a place in consumer technology, Ms. Bashllari said.
“I expect it to increase interest from all of the other big tech companies, either by developing their own or bringing someone else in-house,”
Ms. Bashllari said.
Facebook has been exploring the use of brain-machine technology since at least 2016.
The CTRL-Labs deal has drawn scrutinyfrom the broader technology community because of Facebook’s record on privacy issues, but life science and biotechnology investors consider it a win.
CTRL-Labs likely is years away from launching a product. But how it develops and commercializes its product under Facebook could set the standard for how all consumer-grade brain-machine interface devices reach the public, said Matrix Partners General Partner Antonio Rodriguez, who backed CTRL-Labs in its $28 million Series A round in 2018.
The company also could demonstrate how a consumer device could be developed into a medical-grade device, he added.
“They’ve had a lot of inbound interest from universities, but [CTRL-Labs Chief Executive Thomas] Reardon understood the only way to get to scale was to start from a mass-market consumer product and go backwards into medical care,”
said Mr. Rodriguez, who also invested in Oculus Rift before its 2014 acquisition by Facebook for $3 billion.
“Very few products get adopted as a medical device, so this a way to go forward.”
Before the acquisition, CTRL-Labs raised $67 million from investors including GV, Lux Capital and Amazon.com Inc. ’s Alexa Fund.