Chennai and San Francisco-based software-as-a-service (SaaS) giant Zoho Corp has announced it has invested $5 Mn (INR 35 Cr) in Voxelgrids, an Indian healthtech startup that builds Magnetic Resonance Imaging (MRI) scanners as part of the enterprise tech unicorn’s larger healthtech strategy.
Sridhar Vembu-led Zoho Corp will invest the amount in two tranches for a cumulative 25% stake in the company over a period of 18 months. This is a Series A funding for Voxelgrids which manufactures 1.5 Tesla MRI scanners. The startup has previously raised close to INR 20 Cr in grants including a R&D grant from the Tata Trust.
Voxelgrids MRI Solution
Founded in March 2017, Voxelgrids claims its scanners are lightweight, mobile, and easy to install, operate and maintain even in remote locations such as small villages. The equipment also includes a proprietary software package for imaging purposes.
According to various estimates, close to 70% of the world’s population has no access to MRI scanners. Meanwhile in India, there are only 0.4 MRI scanners per thousand beds, with most of the access restricted to Tier-I cities.
The Indian market is dominated by either imported machines or refurbished equipment which is also expensive. Voxelgrids’ indigenous MRI technology provides a next generation, cost-effective alternative that enables healthcare facilities to save on capital and operational expenditure. It claims to make MRI up to 50% cheaper than the current available market rates.
“We have made notable strides in this area (MRI), and are grateful for Zoho’s support. DeepTech products, like ours, require a significant amount of time from completing the R&D to taking the product to market, and most often, this is the time where we face insufficient funding. The investment from Zoho will help us bridge this gap and speed up our efforts to scale,” said Arjun Arunachalam, CEO and founder, Voxelgrids.
Voxelgrids has developed multiple technologies related to MRI scanners based on custom cryogenics and innovative electronic design and is looking to monetise it through OEM partnerships with other vendors in the field.
The scanner can also be mounted on custom mobile platforms and transported to remote locations where the product can be made operational within a few hours. The operational costs such as electricity consumption is also much lower than other scanners in its class. Voxelgrids also aims to have multiple full-fledged clinical sites before the end of the 2021-22 financial year. It currently has a small team of 22 members including its engineering team.
“We’re looking at three legs to move forward with Zoho support. The first is strategic relationships with like minded global vendors, who are interested in this market segment for rapid market penetration. The second is OEM business opportunities that exist across the world. And finally, design and IP licensing opportunities,” said Arunachalam.
Voxelgrids is not profitable yet but claims to have four large orders from MRI vendors and multiple late-stage discussions with global clients.
Zoho’s Healthtech Focus
Zoho is not only one of the few profitable unicorns in India, but also has remained so since its launch in 1996. In 2019, Zoho had acqui-hired an automated hiring product startup, ePoise Systems, for an undisclosed amount. The deal also included the acquisition of ePoise’s intellectual property rights.
Zoho Corp has invested close to INR 250 Cr in startups like semiconductor company Signalchip, medical device company vTitan and now Voxelgrids over the years, said Vembu.
The company is looking at a larger play in the healthtech solutions space in the future, especially with the National Health Stack being on the cards.
“The vTitan investment already covers healthtech products in the mid to lower end range and Voxelgrids solutions are in the higher price range. Our goal is a full spectrum medical devices company, which needs to exist in India. Essentially, for every critical technology we use today, those companies need to exist in India to address the size of our population, talent pool and market,” said Sridhar Vembu, CEO and cofounder, Zoho Corp.
He added that unlike VCs, Zoho is not looking for short term investments with big returns or even acquisition plans in these companies. Rather they are strategically investing in companies that have long R&D cycles as they sek to build local deep tech solutions.
The company currently has over 60 Mn customers, over 9K employees and offices across seven countries. Overall, Zoho Corp has more than 50 integrated online applications aiding multiple business operations such as sales and marketing, finance, email and collaboration, information technology and help desk, human resources and custom solutions like app creator and analytics.