Medical Device Crowdfunding
Medical Device Crowdfunding
Crowdfunding has become a very popular way for individuals and organizations alike to raise money for various causes. Early-stage medical device projects and startups are also considering crowdfunding as a potential source of capital. So, if you have a brilliant medical device idea and you are trying to raise capital for the project, then it is recommended that you consider starting a Reg CF Medical Device campaign.
Crowdfunding for Medical Device Projects
Despite the massive impact that crowdfunding has had in many industries, the uptake in medical device and MedTech in general seems to have been slower in this regard. If your idea is innovative and compelling, you can raise decent amount of funds for your medical device project through equity crowdfunding. Although medical device projects need a lot of capital before they can successfully complete, the funds raised via crowdfunding can make a huge difference at the beginning of the project’s journey.
To help you decide whether or not a Reg CF Medical Device campaign is worth it, following is a simple 3-point checklist:
Will Investors Care About My Medical Device?
The typical investment minimum is around $100 on most crowdfunding platforms, so no matter what platform you sign up on, you are going to need a lot of investors to raise meaningful capital. For people to back your medical device project, they must:
Think that your device is great, and/or Want to help you succeed so that it solves a particular problem
The combination of both of these is best.
Can I Offer Perks and Rewards?
This is the area where majority of medical device companies struggle. The reason is simple; early access to medical technology is not really something a company can offer for unapproved technology, and a company cannot guarantee participation in a clinical trial. Generally, if the medical device is more consumer-oriented, then it is more likely that it will be appropriate for crowdfunding. Still, if you are creative enough, you can surely come up with some compelling rewards and perks. Be sure to have legal counsel review any offer before you offer it to your investors.
Can I Raise Enough Capital to Make it Worthwhile?
Most medical device projects require a lot of money to reach cash flow positive. So, a Reg CF Medical Device campaign alone won’t get you there. If the capital you raise can propel you to a notable milestone, e.g. proof of concept or functional prototype, and if the crowdfunding platform gives you something else of value in addition to funds, e.g. consumer awareness, user feedback, etc., then crowdfunding could be a good move.
Currently, only a handful of medical technologies might make worthy crowdfunding projects however, one thing is for certain; crowdfunding for medical devices is here to stay. The rules and regulations are just beginning to take shape and currently most platforms only allow accredited investors to invest in these sectors. For those who are in the emerging MedTech and medical device space, a little revolution on the funding side seems in order. Medical Device Crowdfunding
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