Why is it Difficult to launch a Startup in Neurofeedback?
so much neurotech interest, so little results so far
Neurofeedback is the idea of assisting people to control their brain waves consciously, it is generally through electroencephalography or galvanic response.
The potential advantages of neurofeedback therapy in several mental health domains have come to light. It has demonstrated potential in lessening the signs and symptoms of depression, anxiety, and PTSD. Furthermore, it has been discovered that neurofeedback therapy enhances cognitive function, focus, and attention [1].
Moreover, neurofeedback therapy has proven effective in treating a number of conditions, such as autism spectrum disorders, ADHD, and epilepsy [2].
In the following sections I revise why neurofeedback industry is important, and what are the limitation of a potential startup.
The use of neurofeedback in healthcare is expanding due to the people increased interest in this non-invasive method of treating a range of neurological disorders, without mentioning brain-computer interfaces.
However, due to the competition, starting a business in the neurofeedback sector can be difficult in a number of ways.
According to industry forecasts, there is a big potential for growth in the neurofeedback market. The market is expected to grow to be worth millions of dollars by 2029 [3]. Over the course of the projection period, the market is anticipated to increase at a compound annual growth rate (CAGR) of 6.1% to 7.33% [4]. These forecasts show that in the upcoming years, there will be an increase in demand for neurofeedback systems and services.
Despite the sector’s potential for expansion, many startups encounter difficulties taking market share, if not even to survive beyond the initial phase. The market for neurofeedback is expected to grow from its 2022 valuation of USD 54 million to USD 93.15 million by 2031. Furthermore, the industry is projected to grow from USD 1.1 billion in 2022 to USD 2 billion by 2031. These numbers show that there is a sizable market need, but they also emphasize how companies must set themselves apart from the competition and provide distinctive value propositions [5].
Many successful cases including Muse, Neurable, and others, but for most of the others, it has been a challenging field.
One of the primary challenges for entrepreneurs in the neurofeedback industry is identifying market opportunities [6]. It is harder than it sounds. With the rapidly evolving nature of the field, staying up-to-date with the latest advancements and understanding market demands can be overwhelming. A startup focused on neurotech must have a deep understanding of the market landscape and identify gaps where their products or services can make a meaningful impact. How do we can really define a market of people with ADHD given our current society? Would a father of a kid in the autism spectrum be willing to try new gizmos?
Another hurdle faced by startups in the neurofeedback sector is the need for comprehensive knowledge and expertise different fields which are complicated on their own, and combining them. Neurofeedback therapy involves techniques requiring specialized training, understanding of the human brain and its functions, and a lot of math. E.g. Datascientists with knowledge of psychiatry, signal theory and so on do not grow on trees. Startups must have a team of experts who possess the necessary skills to develop and deliver effective neurofeedback solutions.
Moreover, establishing a neurofeedback therapy practice has a number of logistical challenges. Complex licensing procedures and regulatory systems must be navigated by entrepreneurs. This entails making certain that healthcare laws are followed and acquiring the required licenses to conduct business. These regulatory obstacles can exacerbate the overall difficulty and cause a significant delay in the development of a neurofeedback business [6]. Medical certification is one thing; issues about “neurorights” have been raised more recently.
Moreover, as neurofeedback is a very research-intensive subject, three is a need to keep up with the most recent findings and scientific studies [7]. To make sure their goods and services are supported by data and provide real value to customers, startups must spend in R&D. This might be a friendly path for an AI-based company but considering the aforementioned regulation, things get complicated.
Lastly, the financial aspect of creating a neurofeedback startup poses a significant challenge. Research and development, infrastructure setup, hiring specialized talent, and marketing efforts require substantial.
I would say that everything in the end boils down to market-product fit. We should not get too exited over a new interesting technology, despite the promises until we understand the market.
[1] https://nhahealth.com/24-potential-uses-of-neurofeedback-therapy-incl-adhd-part-1/
[2] Hengameh et al. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4892319/
[3] https://www.databridgemarketresearch.com/reports/global-neurofeedback-market
[4] https://www.businessresearchinsights.com/market-reports/neurofeedback-market-109526
[6] https://finmodelslab.com/blogs/how-to-open/how-to-open-neurofeedback-therapy-practice