Augmedics Employees Lead $15 Million Series B Financing to Secure and Successfully Launch Company Amid COVID-19 Crisis
CHICAGO--(BUSINESS WIRE)--Augmedics, a pioneer in augmented reality surgical image guidance, has raised $15 million in Series B financing, led by its U.S. staff. In a nearly unprecedented move, the company’s employees formed limited liability company AUG Management LLC to raise $4 million in an effort to secure and successfully launch the company as venture capital (VC) all but evaporated during the COVID-19 pandemic.
In December, Augmedics announced U.S. Food and Drug Administration (FDA) 510(k) clearance and the U.S. launch of its xvision Spine system (XVS), the first AR guidance system to be used in surgery. xvision Spine allows surgeons to visualize the 3D spinal anatomy of a patient during surgery as if they had “x-ray vision,” and to accurately navigate instruments and implants while looking directly at the patient, rather than a remote screen. The system is designed to revolutionize how surgery is done by giving the surgeon better control and visualization, which may lead to easier, faster and safer surgeries.
Augmedics began Series B fundraising in the third quarter of 2019 with a goal to close the round by Q2 2020 after successful commercialization of its groundbreaking xvision Spine System, slated for Q1 2020. While seeking a lead VC, the company raised SAFE investments (simple agreement for future equity) to continue operations. It received several VC offers and was poised to make final investor decisions and sign term sheets in March, when the COVID-19 pandemic suddenly brought investor activity to a halt. That, compounded with a pause in elective procedures such as spine surgeries, led Augmedics to resort to creative measures in order to successfully launch its groundbreaking technology.
Inspired by success to date, the mission of the company, and the passion of the employees, Augmedics President and Chief Commercial Officer (CCO) Tim Murawski led an unusual effort to raise funds internally. Employees believed so strongly in the technology and the future of the business that they committed to securing the company and propelling its successful commercial launch. Together with their families, the 20 U.S. employees invested $4 million via AUG Management LLC. Existing shareholders, AO Invest and Terralab Ventures, participated in the financing round with a $3.2M investment, and undisclosed investors converted the remaining $7.8 million SAFE notes.
“The dedication of our team and the leadership of President and CCO Tim Murawski is outdone only by the incredible innovation that they continue to demonstrate in the lab, in the field, and at the board table,” said Nissan Elimelech, founder and CEO of Augmedics. “The amount of money that the Augmedics employees committed to continuing operations shows how much they believe in what we are doing – in the technology, the strategy and the leadership – even in these uncertain times.”
“We are a team of problem solvers,” said Tim Murawski, president and CCO, Augmedics. “The creativity and ingenuity of our company began when Augmedics launched to solve a problem our founder saw in the operating room, and it runs through each and every employee who is working to make the vision a success. The global pandemic presented just one more hurdle for us to navigate as a team, and we believe it has only made the company stronger.”
Augmedics’ mission is to give surgeons more control by creating technological advances that cater to their needs and fit within their workflow. The company’s flagship xvision Spine System is designed to revolutionize surgery, as it gives surgeons the information they need, directly within their working field of sight, to instill technological confidence in the surgical workflow and help them do their jobs as effectively and safely as possible.
The Augmedics xvision Spine System has now successfully launched and is being used in renowned hospitals and surgical centers in the U.S. to help surgeons confidently and efficiently care for patients.
Augmedics plans to explore additional surgical applications for xvision beyond spinal surgery. The system’s small footprint, economical cost and compatibility with current instrumentation is designed to allow easy integration into any surgical facility nationwide.
With Augmedics, the future of surgery is within sight. The Chicago-based company aims to improve healthcare by augmenting surgery with cutting edge technologies that solve unmet clinical needs and instill technological confidence in the surgical workflow. Its pioneering xvision system, the first augmented reality guidance system for surgery, allows surgeons to “see” the patient’s anatomy through skin and tissue as if they have “x-ray vision,” and to accurately navigate instruments and implants during spine procedures. Augmedics is backed by Terra Venture Partners and AO Invest, a venture arm of the AO Foundation. The AO is a medically guided, not-for-profit organization, a global network of surgeons, and the world's leading education, innovation, and research organization for the surgical treatment of trauma and musculoskeletal disorders. For more information, visit www.augmedics.com.