Key takeaways

  • Healthcare wearables company wins Australia’s largest equity crowdfunding round.
  • Investors see value in healthcare data produced by technology connected to the internet of things.
  • Growth of crowdsourcing for equity to be supported by the Australian government.

Proof that the excitement surrounding wearable technology for healthcare is still alive and well, the company behind a device that monitors patient movement has received Australia’s largest equity crowdfunding round to date.

Investors have raised $1.5 million for Global Kinetics Corporation (GKC), which produces wearable healthcare technology to aid the treatment of patients with Parkinson’s disease.

Based in Melbourne, GKC is planning on using the finance to expand its presence in the North American market through commercialisation of its KinetiGraph device.

Worn on the wrist, it notifies the wearer when they need to take medication and records their movement over a period of six to ten days, providing a report that can help doctors assess the impact of the disease and the effect of allocated medication.

Investing in data

The KinetiGraph is just the tip of the iceberg in terms of wearable technology in healthcare. As the internet of things – the connection of Wi-Fi enabled devices that share information – gains momentum, expect to see plenty more wearables playing a role in the monitoring and detection of chronic illness.

The value of this technology lies in the data that is produced.

Andrew Maxwell, managing director of GKC, told The Australian: “We sell our service, which is a report similar to an MRI or ECG report, that includes information about a patient’s movement every two minutes. Our information leads to better decisions… which leads to better clinical outcomes, and improved quality of life for a person with Parkinson’s and also lower healthcare costs.”

The funding was leveraged through OurCrowd, a crowdfunding platform that launched in Australia in early 2014.

“Anyone who has been the CEO of an unlisted pre-profit bio-focussed organisation in Australia knows that the greatest proportion of time is spent on the pursuit of capital,” Maxwell is quoted as saying in the Sydney Morning Herald. “It will be easier to raise large amounts in the future as [equity crowdfunding] platforms become more accepted. Rather than talk to 15 different venture capital firms who all want to control the business and have their own terms you can have that discussion once with the crowdfunding organisation,” he added.

No guarantee of success

High-profile successes such as this funding round and of items such as the Pebble Watch – which has twice beaten records to become the most financed project on a crowdfunding platform, recently raising US$20.3 million via Kickstarter  – can, however, belie the risks involved.

According to Kickstarter’s own statistics, only 21% of crowdfunded technology projects succeed through to delivery, against a cross-industry average of 38%.

In the latest Federal Budget, however, the Treasurer pledged $7.8 million to the implementation of a framework to assist the growth of crowdsourced equity funding in Australia, signifying that this route for funding support for technology start-ups is set for continued growth.


Nikhil de Silva is a former partner in PwC’s Customer Consulting practice.

 

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Nikhil de Silva

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