“The current valuation is $10 million, the next one will be $15 million,” Ilya Popov, Comeback Mobility
On October 10, it became known that the Ukrainian medtech startup ComeBack Mobility had raised $500,000 in investment from ZAS Syndicate. AIN.Capital’s editor talked to the startup’s co-founder, Ilya Popov, about investments, plans, acceleration at TechStars (which the team joined a month ago), and the product’s development.
Please provide a project status update: How many users and people in the team and what product development status does it have?
The product is ready and has been working for almost six months without a single bug in both software and hardware. Now, we are working on additional features related to the full automation of teaching patients how to use crutches. For this purpose, we already have all the necessary hardware components: accelerometers, magnetometers, and gyroscopes, which can be used to record the trajectory of crutches.
In the future, we plan to eliminate the need to use human resources to train patients to walk on crutches and replace it with machine learning. Accordingly, we will be able to save tons of money for insurance companies and hospitals, as well as working hours in hospitals.
The project also implemented all the necessary regulatory parts, including FCC, Quality Management System, FDA compliance, HIPAA, a validation study, a patient and medical provider satisfaction study, as well as several studies aimed at identifying the exact percentage of complications reduction by using our product for each specific case (diagnosis). These studies now cover many hospitals in Texas, and perhaps a hospital in San Francisco will also participate—we are currently negotiating cooperation.
We have conducted over 180 free pilots with US public and private hospitals and clinics. Now, we have dozens of patients from several New York and Chicago hospitals. Many physiotherapists and rehabilitation specialists use the product. We focus on the best orthopedic hospitals and paid pilots.
The team currently has six people. Three of them are US-based, and the rest are in Ukraine.
What was the agreement on the investment with ZAS Syndicate? Did you negotiate for long?
There were a few interested foundations, but they were only somewhat relevant to us, so we could not reach an agreement. We started communicating with Andrii from ZAS around May 2023.
As for the current investor, Volodymyr Pirus, we can exchange partnerships and clients thanks to his portfolio companies in the same industry and his connections with insurance companies and hospitals. This is a win-win situation for both projects.
How much investment has Comeback Mobility secured since its inception? What is the current valuation of the startup? How much more money do you plan to raise in the future?
To date, we have raised a total of $2.2 million. We will need $4 million for full reimbursement with the six major insurance companies in the US market and to enter the top 10 orthopedic hospitals in the US. The money is also needed to manufacture at least 2,000 pairs of Comeback Mobility crutches. So now we are raising another $2 million.
It takes an average of seven years and at least $15 million to bring a medical device to the US market. We do it very quickly and with a minimal budget. Accordingly, the half a million raised now will be spent on pilot projects with insurance companies and hospitals. We will sign letters of intent, according to which, these medical institutions will agree to either reimburse our development costs or purchase a batch of our devices, if certain results are achieved.
By the way, we assemble our product in Ukraine. We are very proud of our own workshop in Dnipro. And, when we see “Assembled in Dnipro” on devices used in Manhattan,—that’s very cool.
You have also signed a letter of intent with ZAS for an additional $500,000. What are the terms for receiving these funds, and what are your plans?
Our lead investor, Volodymyr, wanted to come in for $1 million. We have already signed an agreement for $500,000 and expect the funds to be credited to our account by the end of the week, I believe. As for the next tranche of another $500,000, we agreed that ZAS Ventures, including Volodymyr, would have the option to invest at the same valuation until December 1, 2023.
We closed the previous rounds with a capitalization of $10 million. The following investments we plan to raise at our demo day will already be valued at $15 million. Accordingly, Volodymyr and ZAS Ventures have a significant advantage as an early investor.
We have also learned that you have passed to TechStars. Can you tell us whether you have attracted investments from the accelerator, what is the amount, and what are your expectations from the program?
Yes, indeed, TechStars has invested $120,000 in us. We have already completed three weeks of the acceleration program. The program is worth it, and we could realize in the three-month program many things that we would have spent years on because TechStars opens the door to vast networking.
It’s really a significant acceleration, not just a small check.
It’s a community focused on making money, change, and technology. Although we were initially sceptical, we are delighted to be part of this program. If I could make the decision again, I would still go into this program even if we had enough money in our account.
We’re only halfway through, and we’re already seeing huge benefits. In particular, we have tested hypotheses on time and discovered that we are moving in the wrong direction. Thanks to daily meetings with different mentors, some old hypotheses have disappeared. Instead, new ones emerged. And most importantly, we realized where the money is in this business.
My expectations from the program have already been met. I hope that the director of this program and a community of thousands of people become part of the team not for three months but for the rest of their lives, within this or another project. We will remain friends and, as TechStars alumni, will be able to count on help and mentoring.