NEA backs Eargo in $25M round to market its 'invisible' in-ear hearing device
|Eargo hearing aid--Courtesy of Eargo|
Hearing aids are a tough medical device category. Long-term options are viewed as not particularly effective, convenient or affordable, since payer reimbursement can be tough to get. In the U.S., Medicare does not cover hearing aids for seniors. Rates of usage for hearing aids remain far below what they could be, given these tough issues.
Medical device heavyweight New Enterprise Associates (NEA) has committed to lead a $25 million Series B financing for a recent entrant to the hearing aid category. Founded in 2010, Eargo operated in stealth mode until it raised a $13.6 million Series A and launched its mild to moderate hearing loss hearing loss products in June.
"Eargo is one of the most innovative and fastest-growing consumer medical device manufacturers in Silicon Valley, and its groundbreaking technology is changing the way people think about hearing loss," said NEA General Partner Dr. Josh Makower in a statement. "Because Eargo is at the intersection of consumer technology and healthcare, and is poised to disrupt the traditional hearing aid industry, it is the perfect brand to add to our consumer Healthtech portfolio."
Eargo markets its hearing devices in a pair, one for each ear. And it's opting for a novel pricing strategy; the company said its $1,980 price is less than half of the price for a pair of hearing aids in the U.S. Eargo is also offering a per-month fee plan of as little as $96 per month for a pair of new hearing devices, the portable charger and the charging base.
The startup's hearing aids are targeted to people with mild to moderate hearing loss starting in their 30s, of which there are almost 50 million in the U.S. They fit entirely into the ear canal, thereby earning the moniker of 'invisible' from the company.
The devices are based on Eargo's Flexi Fibers technology, which is used to suspend them in the ear canal. Unlike with other in-ear hearing aids, the material is soft and doesn't block the ear canal so low, bass sounds can pass through. Therefore, the Eargo devices are focused on amplifying mid and high tone, treble sounds.
|Eargo hearing aids and portable charger--Courtesy of Eargo|
The regulatory strategy for Eargo remains unclear. It's not addressed in any publicly available company or FDA information. Eargo had not returned a call for comment on its regulatory strategy at press time. In September, the agency gave a PMA approval to a new hearing aid from another startup, EarLens, that's based on laser light pulses.
"Since the launch of our new hearing device earlier this year, we have seen an incredible level of consumer demand and ultimately have been experiencing tremendous growth as a company," said Eargo co-founder and CEO Raphael Michel. With NEA, "together we are strongly positioned to bring innovation in hearing health to the millions who may need a boost but who have remained on the sidelines until now due to cost or stigma."
In addition to NEA, Eargo investors include Maveron, Dolby Family Ventures, Crosslink Capital, Birchmere Ventures, Montage Ventures, Peterson Ventures and Red Sea Ventures.
- here is the announcement
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