NuEyes is raising at a $25 million valuation. It is not unusual for a medical provider which has multiple viable products and has been taking in revenue for multiple years to be valued highly. However, given that revenue hasn’t significantly increased over the past three years, and the technology is still unproven, this valuation seems unjustified. Thus, NuEyes’ price score is its lowest across all five metrics.

Approximately 1.3 million Americans age 40 and older are legally blind, and nearly 4.2 million in the same age category that are visually impaired. More than 7.6 million adults overall suffer some form of visual disability. By 2050, these numbers are expected to double. These people are NuEyes’s most immediate targets, and the global vision care market is expected to reach $195.34 billion by 2026, with the highest CAGR in Asia-Pacific markets. The U.S. market comes in at $37.5 billion. Obviously much of this market involves normal vision testing and vision correction through glasses and contacts. However with vision-impaired patients on the rise, there is a sufficient market for NuEyes’ interests, for now. Through ever-improving product lines, NuEyes could encourage repeat consumers.

The AR/VR market, by contrast, is small but growing by leaps and bounds. The global market accounted for a respectable $37 billion in 2019, and aggressive projections expect it to balloon at a 42.9% CAGR to $1.27 trillion in value by 2030. NuEyes’ new partnership with AR/VR solutions provider Unity is part of a larger effort on the company’s part to step into this market, providing solutions for government and enterprise needs as well as other medical needs.

Due to the strong growth in both the vision care market and the AR/VR market, NuEyes scores above average in the market metric.

NuEyes is headed up by CEO and founder Mark Greget, a U.S. Navy veteran and graduate of National University. Greget spent several years working in real estate as a sales specialist, before taking the role of CEO of Los Angeles Low Vision, a distributor for enhanced vision, and has authored a patent for market exclusivity. While Greget claims Los Angeles Low Vision was a “leader” in the medical industry, it has been difficult to track down and verify any information about the company.

Regina Chatman is NuEyes’ Senior VP of Sales & Marketing. Chatman brings twenty years of experience in sales management and customer relations. Most notably, she spent nine years working as Sales Liaison Supervisor and Contract Administrator for Enhanced Vision, a company focused on support for individuals with impaired vision. Her move to NuEyes as a Senior VP seems a natural transition point. 

Finally, Trevor Backlin serves as Executive VP, a new addition to the team. Backlin has held a number of senior leadership roles in sales and business development over the last few years, most prominently with four years as Senior Account Manager for Adobe. He has experience with manufacturing and technology companies, experience that will serve him well in his time at NuEyes. 

The team appears adequately familiar with the requisite markets they are targeting, but there are no standout specialties or experiences among them. There is also no past entrepreneurial experience among the key members. As a result, NuEyes’ team score is middle-of-the-road.

NuEyes’s biggest differentiator is the product itself. Its technology is patent-protected and set apart from competitors — including industry giant Microsoft — with a balance of affordability and product quality. The products are relatively light and rest comfortably on the face, provide a wide field of view (52 degrees), and depict high-fidelity 1080p renderings with a 20 megapixel camera. The company has also partnered with Comcast to provide streaming services through its devices.

While the market does have relatively high barriers to entry — VR is a highly experimental and specialized field — competitors are increasingly springing up. Competitors focused on medical applications, such as eSight and IrisVision, have similar applications and specifications that present serious challenges to NuEyes’ chosen niche. Balancing the patents and strong development of NuEyes’ products against the growing challenge of competition, NuEyes’ differentiators score is above average.

In terms of financial performance, NuEyes is somewhat difficult to gauge. As of this writing, it has omitted some details in its filing documents. NuEyes did take in $932,958 in revenue in 2019, a decrease from $1,012,566 in 2018. Admittedly, its COGS was much lower in 2019 — down to $354,050 from $517,307 in 2018. Unaudited, it claims to have taken in $3.6 million in revenue to date. The company has little cash on hand, but believes it can continue to operate without problems in the coming months.

On a more optimistic note are the prominent partnerships NuEyes has secured. Most prominent is the partnership with Comcast, but the company is also working with giants like AT&T and United Healthcare. It has more than twenty pilot programs with prominent organizations such as the U.S. Department of Veterans Affairs and UPS, with ten more pending approval. Many of these partnerships will offer NuEyes strong competitive advantages going forward.

Due to the company’s strong revenue and numerous partnerships, NuEyes’ scores very highly in the performance metric.

NuEyes’ focus on medical applications for its product has limited its addressable market size so far, and decreasing revenue increases does not bode well for future success. As NuEyes attempts to expand its verticals into more general VR and AR applications, its field of direct competitors will also expand, requiring product perfection on the technical side to prevent Microsoft and other new, well-financed competitors from muscling it out of mainstream markets.

While the company’s revenue stream has been steady over time, a startup needs to show a record of growth. While the company claims its revenue is increasing and has aggressive projections for 2021, the numbers have yet to bear that out. Investors are hedging their bets on what is, thus far, unproven technology in a field that is about to become very crowded. While NuEyes seems to be performing well in the limited space of low vision applications, it needs to expand dramatically for investors to see significant returns.

While revenue growth has been lackluster, it hasn’t decreased significantly, and NuEyes has laid infrastructure for years of productive partnerships and new product lineups. Provided the technology proves applicable for diverse verticals in government and enterprise sectors, NuEyes can expand its reach beyond purely medical application — in which it has done well — and reach broader markets. While competition will be fierce, the coming years are also likely to see hugely expanded interest in VR and AR — perhaps especially in the wake of the isolating novel coronavirus pandemic, which has led to a surge in consumer interest. If NuEyes continues to refine its product offerings and secure new verticals, it could see significant growth in the coming years.

NuEyes is providing augmented reality and virtual reality solutions to give near-perfect vision to individuals suffering from low vision and legal blindness. The company’s four offerings — the NuEyes Pro and Pro 3, and the NuEyes E2 and E2+ — offer patients the ability to read, watch television, and connect with loved ones.

Thanks to partnerships in AR and VR fields, NuEyes plans to expand its high-quality, relatively-affordable product offerings for government and commercial applications. However, the company’s technology has yet to prove dominant over a large field of competitors, and revenue growth has been practically nonexistent over the past three years. Therefore, NuEyes is a Neutral Deal.

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Analysis written by Benjamin Potts.