In response to the tremendous clinical progress of Elon Musk’s Neuralink, investors are pouring money and attention into brain-computer interface (BCI) technology. But obscured by the VC buzz, one important element remains murky: user acquisition.
Despite VCs collectively investing over $3 billion in these startups since 2024, the technologies are still experimental, highly invasive and commercially unproven. Neuralink alone has raised more than $1.34 billion from blue-chip VCs and is currently valued at more than $9 billion, but as of January, it says it has 21 participants in its clinical trials worldwide. Its current technology surgically implants a number of electrodes into a patient’s brain to then capture and transmit information to an external device.
“There’s this hesitation to have something foreign in their heads,” said Laura Cabrera, an associate professor of engineering at Penn State. “It’s this hesitation of ‘this is my brain, this is part of who I am.’” In Cabrera’s research, the majority of patients with neurodegenerative conditions, including Parkinson’s disease, said they did not want an implant or would consider it only if their symptoms worsened.
That resistance is a common theme across the industry: According to a study, only 1-2% of eligible Parkinson’s patients in the US annually undergo deep brain stimulation—a form of BCI—despite the neurodegenerative condition currently being one of the strongest use cases for the technology.
Estimates for the total potential market for BCI technology vary widely, but there’s a sizable population of people with existing conditions that could make up the core customer base. There are over 90 million stroke survivors globally, approximately 65% of whom will experience motor disability six months post-stroke, according to a 2022 Nature report. More than 11 million people have Parkinson’s, and 20-25 million people globally have non-cataract blindness.
For the everyman?
For some VCs and entrepreneurs, the addressable market for BCIs extends far beyond the neurology clinic, as they believe brain implants will become a technology for young, healthy Americans to improve cognitive function and memory.
“Eventually, you go from restoring function to enhancing function,” said D. Scott Phoenix, a partner at Fifty Years who’s invested in BCI startups Merge Labs and Science Corp. “At that point, it becomes a device a lot like a smartphone, where it’s very common, and everyone has it. ... It becomes much more of a compelling value proposition to people who have a normal, healthy brain.”
Enhancing cognitive abilities will appeal to people who are interested in longevity innovations, biohacking and health optimization, the thinking goes.
Similarly, some investors believe that for humans to keep up with the pace of AI intelligence, they’ll need to augment human cognition with neurotechnology. But much will still depend on fundamental factors: how well the technology actually works, how invasive it is and its cost (such nonessential devices would likely not be covered by insurance).
“With neuro devices, there’s the ‘Field of Dreams’ idea of: ‘If you build this, they will come.’ That’s just not the way it works,” said Gabriel Lázaro-Muñoz, an associate professor of psychiatry at Harvard Medical School.
Not for the faint-of-heart VCs
The consensus is that it won’t become mainstream for a long time, and even some risk-takers in venture capital are staying away altogether. Obvious Ventures, a frontier tech VC firm that has invested in several AI healthtech and biotech plays, has passed, in part due to safety concerns.
“Medicine, for us, starts with do no harm,” said James Joaquin, managing director at Obvious, referring to surgical subdermal implants. ”If it’s invasive and has the potential to harm patients, it’s not something that’s on the menu for us.”
Even the category’s biggest boosters are cautiously optimistic. “People aren’t going to just go to their Apple store and want a brain chip,” said Abdo John Hajj, managing partner at Type One Ventures, who has invested in several BCI startups, including Neuralink. “You have to really think about that from a tech to commercialization risk timeline,” said Hajj, who said while he envisions a future where regular people receive BCI implants, he’s not underwriting BCI startups for that reality. “Commercialization in the short term looks like the world’s best-in-class healthcare organizations,” he added.
Still, that’s not stopping some VCs from envisioning that neurotech could someday enable digital consciousness that lives on after the body gives out. “I think it’s hard to rule out [in my lifetime],” Phoenix said. “And certainly talking to people in the field, they all seem to, or many of them seem to have, pretty well formed beliefs that this is a plausible path in the next 15 to 30 years.”
For investors interested in living forever, neurotech has a powerful pull. But for a pragmatic investor, the realities of user acquisition are less glamorous.
“My sense is that now is the right time to begin to look at these companies,” said Aidan Madigan-Curtis, a partner at Eclipse who invests in robotics companies. To her, the industry is still nascent enough to offer smart investing opportunities, yet it’s also been around long enough to provide some clues and signals to investors about the better bets. “We’re probably a number of years away from this being a mass-adoption type of thing,” she added.
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