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on september 18, another big news came from neuralink, a brain-computer interface company owned by musk:"blindsight" has officially received fda "breakthrough medical device" certification. this product is expected to restore sight to the blind.. on the day the news was released, a-share brain-computer interface concept stocks soared collectively.

in fact, this is not the first time neuralink has caused a stir in the industry. at the beginning of this year, neuralink announced the completion of the first human brain device implantation surgery. the implanted product is "telepathy". this is neuralink's first product. after implantation, patients can control their mobile phones or computers with just their thoughts. and through them you can control almost any device. it is reported that this product is mainly aimed at disabled people with quadriplegia due to cervical spinal cord injury or amyotrophic lateral sclerosis, and will help them regain their ability to move.

the progress of science and technology is certainly gratifying, but when it gradually enters the market, a practical problem is also faced, that is,when will these disruptive products become truly widespread?by asking many practitioners, they generally think it will be ten years later. musk also expressed the same view on this. when he released the first product, he predicted that millions of people would use neuralink in ten years.

this is undoubtedly a long cycle, but for neuralink, which is helmed by musk, of course it has the capital and confidence to wait. but for those brain-computer interface companies that do not have strong financial strength,in the current environment where funding channels are increasingly narrowing, how can we survive this long decade of unprofitability?

why wait ten years?

as a cutting-edge technology aimed at the future, brain-computer interface has an extremely wide range of application scenarios, covering many fields such as medical care, entertainment, military, education, etc. among them, medical care is currently receiving the most attention, including allowing paralyzed people to stand, allowing aphasic people to speak, and allowing people with aphasia to speak. restoring sight to the blind, making patients with depression no longer depressed... no matter which one of them is picked out, once it is realized in the market, it will be enough to be recorded in the annals of human history.

perhaps precisely because of this, its road to success is particularly difficult. take neuralink as an example. although musk is in charge, it still encounters obstacles everywhere. in 2022, 15 of the 23 rhesus monkeys in neuralink's explosive trials died, and the fda therefore twice rejected its application for human experiments. although neuralink successfully completed the first human brain device implantation surgery in early 2024, in may this year, the latest news was that some of the brain implants malfunctioned, and some of the electrode wires implanted in the brain fell off, and the amount of data captured significantly reduced. this is undoubtedly a heavy blow to neuralink, which is eager to conduct more extensive clinical trials.

you must know that this is still in the early clinical stage. there is still a long way to go before it can be truly launched on the market. ten years may be just a conservative estimate. so, what is blocking the realization of brain-computer interfaces?

the first point is of course technical limitations.. taking engineering capabilities as an example, the human brain has at least 86 billion neurons, and each neuron has thousands of links. this is a huge network, so the brain-computer interface wants to make the instructions issued more stable and accurate. the number of channels connected to the electrodes must be increased. but from the current point of view, brain-computer chips represented by n1 implants can monitor the activity of up to 1024 channels of neurons at the same time, which is obviously not enough. in addition, implant materials and the human body may produce allergic or rejection reactions, which currently also face many challenges.

figure 1. brain-computer interface system logic

in this regard, a researcher from the beijing institute of brain science and brain-inspired research said, "unlike other device fields, brain-computer interface research is currently promoted by almost all scientific research institutes, and not many are led by doctors." that is to say,brain-computer interface is actually still in the laboratory stage. the industry is still focused on basic research, and it is too early to talk about industrialization.

the second point is the lengthy registration and approval process.. at present, the state food and drug administration has not issued clear standards for brain-computer interfaces, but only stated that it can be registered and applied for class iii medical devices in accordance with the "medical device classification rules", so its approval cycle may take two to three years. but this is only an idealized estimate, because invasive brain-computer interfaces currently face safety risks and ethical issues, supervision will inevitably become more stringent, and the approval cycle may be lengthened.

figure 2. approval status of some brain-computer interface medical device products in china (data source: zhiyan consulting)

in this regard, li xiaojian, founder of weiling medical and senior engineer at the shenzhen institute of advanced technology, chinese academy of sciences, said in an interview, “the electrodes and chips used in invasive brain-computer interfaces all adopt new design methods and are not designed using traditional methods. implantable medical devices must be modified. therefore, each module of equipment must be registered and approved as a class iii medical device, including product technical review, clinical trials, production and quality management system review. in addition, the entire the approval process for brain-computer interfaces is designed based on safety, effectiveness, and stability, and it will not change much in the future.”

the last point is the constraints at the market level.in fact, since the advent of brain-computer interfaces, the industry has been discussing ethical issues. there are two main areas of discussion. one is whether reading the patient’s neural activity information and subconscious content constitutes personal privacy. the second is whether the enhancement of the functions of a few people by brain-computer interface will affect social fairness. for this reason, the industry has also extended a key question, that is, what if a company selling implants goes bankrupt in the future? in 2013, brain-computer interface maker neurovista collapsed after being unable to secure new funding, and epilepsy patients participating in clinical trials of its devices had to have their implants removed. this is obviously not in line with market standards.

in addition to ethical issues, marketing is also affected by cost and price. still taking neuralink as an example, its current total cumulative financing has exceeded us$700 million. in the future, as clinical research advances, the amount of investment will further expand. according to the pricing previously announced by neuralink, the cost of each implant surgery is approximately us$10,500. however, this is not fixed. the specific cost will vary depending on various factors, but it is certain that it will not be cheap. between high investment and high pricing, it is often difficult to balance costs and income.

nicolelis, the father of brain-computer interface, once said of neuralink, "the real development and widespread use of brain-computer interface technology requires three main criteria: safety, effectiveness, and affordability.neuralink obviously violates these three principles. first, it is not completely safe, and implantable devices may produce an inflammatory response in the brain; second, its read transmission efficiency does not make up for the risks posed by implants in the brain; finally, but its price is also very expensive. "

non-intrusive:

self-rescue and solutions for brain-computer interface companies in the cold winter

although musk is still talking about the infinite possibilities of brain-computer interfaces in the future, for the vast majority of brain-computer interface companies, the issue of survival is clearly before their eyes. according to arterial network observation,many companies that have been favored by the market and have entered series b financing have not seen any new developments for a long time. in addition, the capital market is also deserted. most companies are currently on the verge of breaking their capital chain.

a senior investor also confirmed this to artery.com. he said, "at the beginning of the year, a business founder came to sit with me for a long time, but until the end, we still did not find a good commercialization direction. so at this stage , we will still pay attention to brain-computer interface, but in fact we have not taken action for a long time.”

so, how can brain-computer interface companies that have been forced into a corner survive now? by asking many practitioners,they all agreed that they should take stock of the company's cash flow and concentrate resources and energy on launching products that can be quickly certified and can be monetized as soon as possible. in short, it is necessary to focus more on products with stronger market certainty, and from the current point of view, non-invasive brain-computer interface is obviously a good choice.

figure 3. comparison of three intrusion methods of brain-computer interface (data source: zhiyan consulting)

it is reported that according to the different ways of connecting to the brain, brain-computer interfaces can be divided into three types: invasive, semi-invasive and non-invasive. currently, the industry is most concerned about the invasive type. for example, neuralink belongs to this type. it requires the advantage of implanting electrodes into the cerebral cortex or gray matter is that the signal collection effect is good and the therapeutic effect is more significant. however, the disadvantage is that the risk is high and the technology is complex. therefore, the approval is strict and it is difficult to realize it in the short term.

the non-invasive method is just the opposite. it does not require surgery and only requires the electrodes to be attached to the scalp. although the signal quality is lower than the invasive method, it is safer, the price is relatively cheap, and it has high market acceptance.in addition, most non-invasive medical devices belong to class ii medical devices, so the approval cycle is short, approximately 12 months.

currently, there are many non-invasive brain-computer interface products on the market, including eeg collection equipment, sleep instruments, concentration training bracelets, meditation rings, smart headphones, etc. however, from the current stage, the commercialization of such products is not progressing smoothly. taking the meditation ring of a certain domestic company as an example, the sales volume on various e-commerce platforms ranges from single digits to hundreds of pieces, making it difficult to generate stable cash flow.

in this regard, a senior investor said, "this type of consumer-grade product actually has a very limited role and is highly substitutable in the market, so it can at most generate some positive cash flow, but it is impossible to survive on this money for a long time. impossible". according to many industry insiders, the future of non-invasive brain-computer interfaces is still in the application of rehabilitation and mental illness treatment. nicolelis, the father of the brain-computer interface, also agrees with this. in a recent interview with the media, he said, "although i invented the invasive brain-computer interface and have a 20-year patent in this area, i still believe that non-invasive "brain-computer interface will be the mainstream of development in the next few years, especially for the treatment of various diseases such as parkinson's, chronic epilepsy, stroke, depression, loneliness, etc."

specifically, compared with simple consumption medical scenarios, rehabilitation and mental illness have clear market demand; secondly, compared with invasive methods, non-invasive methods cause less damage to patients and are safer, so they are easier to treat. approved; the last point is that the non-invasive method currently has mature clinical experience in rehabilitation and treatment of mental illness, and there are many related products.

figure 4. situation of some existing non-invasive products

for example, qiangnao technology's smart bionic hand only needs to be worn on the hand, and it can achieve motion control by processing myoelectric nerve signals, and provide rehabilitation, training and other services for the disabled. there is also spectris, a non-invasive neuromodulation system designed to treat cognitive and functional symptoms associated with alzheimer's disease through specific light and sound stimulation. modius stress focuses on anxiety relief. it was approved in march 2024. it mainly regulates the parasympathetic and sympathetic pathways of the autonomic nervous system's response to stress by stimulating the locus coeruleus and the paraventricular nucleus of the hypothalamus.

in addition to this, non-invasive brain-computer interfaces have led to e.g.cochlear implants, humanoid robotswith the rapid development of emerging markets, there is a strong possibility of monetization in the future. in this regard, professionals who have completed multiple rounds of brain-computer interface investments said,"as far as brain-computer interfaces are concerned, invasive is the future, but it is still too early. non-invasive is the self-rescue and way out for brain-computer interface companies at the moment."

how to win in the future:

technology and market are indispensable

according to mckinsey's calculations, the potential market size of global brain-computer interface medical applications is expected to reach 40 billion to 145 billion us dollars in 2030-2040. among them, serious medical care, which mainly focuses on the treatment of central nervous system diseases, has a potential application scale of 15 billion to 85 billion us dollars. us dollars, while the potential application scale of consumer medicine, which focuses on emotion assessment and intervention, is roughly us$25 billion to us$60 billion.

figure 5. map of brain-computer interface companies (source: zhiyan consulting)

stimulated by the huge market space, industry competition is inevitable. according to the research report of northeast securities,80% of my country’s brain-computer interface companies have chosen the non-invasive collection technology route.typical representatives include naolu technology, qiannao technology, rouling technology, huichuang medical, etc. from the current point of view, there are still many companies that are accelerating their transformation to it. this means that industry competition will gradually intensify, and if you want to break out of the tight encirclement, future investment in technology and market links is essential.

let’s talk about technology first. in fact,in fact, the gap between my country's brain-computer interface hardware and foreign countries is not big. however, in terms of theoretical research on the neural mechanism of chinese language, such as the encoding mechanism and decoding algorithm involving neural electrical activity, there is still a big gap between the current and foreign top levels.in this regard, the founder of a company said, "the most obvious advantage of neuralink is the system integration and industrial design capabilities behind its full-system implants. this is the result of the domestic brain-computer interface r&d team and the world's top the gap in the team is there.”

this actually means that my country still has weak links in many fields such as computers, neuroscience, bioengineering, and mechanical engineering. to this end, a senior investor said, “because brain-computer interface integrates multiple disciplines, its technological iteration must also require the joint promotion of various disciplines. therefore, in an enterprise, it needs to have more disciplinary backgrounds and a larger talent pool will give it an advantage in engineering implementation, which is also the key for future brain-computer interface companies to stand out.”

of course, in addition to technology iteration, market capabilities are also crucial. this focus is reflected at two levels. the first is to be able to find one's position in the industrial chain, mainly in the selection of technical routes and applied disease fields. the core logic is to be able to realize money quickly, seize short-term benefits, and avoid wasting money. . the second point is to have strong sales capabilities, that is, to be able to sell your own products to the maximum extent, which involves the establishment of channels and industrial chains.

in fact, compared to the rigorous pursuit of technology by the intrusive approach, the non-intrusive approach may place more emphasis on the ability to deliver on the market level. in this regard, a senior investor said,“most founders in the brain-computer interface field have engineering backgrounds, so they are generally insensitive to clinical needs.this is actually very fatal, because it requires a large initial investment. once the choice is made incorrectly, start-ups with very limited fund scale and manpower will easily fall into adversity. therefore, it is particularly important to select good indications and strengthen marketization capabilities. "

until now, the development of brain-computer interface has only been 50 years, so it will definitely have many changes and possibilities in the future, but one thing has reached industry consensus, that is

it is necessary to grasp the cash flow, temporarily put aside those dreams that are still far away, and focus on those brain-computer interface products that are safe, effective, affordable, and quick to cash out.

references:

1. "brain-computer interface companies are planting a tree that will bloom in ten years" - economic observer;

2. "exclusive interview with the "father of brain-computer interface": why i am worried that musk is misleading the public" - china science news;

3. "brain-computer interface is very close to curing depression and paralysis, but far from digital immortality" - 36 krypton pro.