Sensate, with a valuation of $18 million, is raising funds on Wefunder. The company is revolutionizing wellness technology by using the natural power of sonic resonance to calm the body’s nervous system. Sensate’s device provides immediate relief from stress and relaxation in just ten minutes of use. The business uses infrasonic therapy to help the body recover from daily stresses. Sensate generated $5.32 million in revenues in 2023 and is sold in over 50 countries. Anna Gudmundson and Stefan Chmelik founded Sensate in November 2021. The current crowdfunding campaign has a minimum target of $50,000 and a maximum target of $618,000. The campaign proceeds will be used for R&D, product and manufacturing improvements, growth and channel expansion, subscription and recurring revenue development, opex investments, and working capital.
Investment Overview
Raised: $389,895
Deal Terms
Company & Team
Company
- Year Founded
- 2021
- Industry
- Fitness & Wellness
- Tech Sector
- Distribution Model
- B2C
- Margin
- Medium
- Capital Intensity
- Low
Financials
- Revenue -3.2% YoY
- $5,402,741
- Monthly Burn
- $322,106
-
Runway
- 1.6 months
- Gross Margin
- 45%
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Synopsis
Sensate is carving a niche in the wellness technology market with a new approach to stress relief. The company's flagship product leverages the power of sonic resonance to provide immediate calm to the body's nervous system. This device, which is designed for use just ten minutes per day, employs infrasonic therapy—a method that utilizes vibrations and sound to facilitate the body's recovery from daily stressors. With a user-friendly interface, the device works by emitting soft vibrations over the chest area while synchronized soundscapes are played through an accompanying app, creating an immersive relaxation experience.
Founded by Anna Gudmundson and Stefan Chmelik, Sensate has quickly established a global footprint, selling its stress-relief device in over 50 countries. The company reported revenues of $5.32 million in 2023. With a valuation of $18 million, Sensate's ongoing crowdfunding campaign on Wefunder aims to secure additional capital to support its growth plans.
Price
Sensate, with a pre-money valuation of $18 million, is offering preferred equity at $0.51 per share in its current fundraising effort on Wefunder. This valuation and price per share are set against the backdrop of the company achieving $5.32 million in revenues in 2023, a significant milestone in the competitive fitness and wellness industry. Sensate's performance is particularly noteworthy given its product's global reach, having been sold in over 50 countries, and its recognition as one of TIME's Best Inventions of 2022.
The company's valuation is grounded in its proven traction, including $15 million in lifetime revenues and backing from nine venture funds, which underscores investor confidence in Sensate's market potential and business model. The revenue multiple of 3.33x, based on the latest annual revenue, suggests a valuation that is conservative. This positions Sensate as a potentially undervalued investment opportunity.
While the company's current stage and financials already demonstrate significant achievements, achieving a 10X return would likely necessitate Sensate becoming a dominant player in the wellness technology market, leveraging its patented technology, and possibly expanding into new wellness verticals.
Market
The wellness and prevention connected health devices market, in which Sensate operates, is experiencing robust growth, with a market size of $51.26 billion globally for 2024. This growth is fueled by a growing awareness of mental health and the importance of stress management, combined with a rise in chronic stress levels due to various factors such as work pressures, urban living, and social dynamics. These market drivers underscore a significant demand for products like Sensate’s device, which uses sonic resonance to calm the body’s nervous system, offering immediate stress relief and relaxation with just ten minutes of use.
However, the market is not without its challenges. The relatively high cost of advanced wellness devices, including Sensate’s, presents a barrier to widespread adoption, especially in price-sensitive markets. Despite this, Sensate’s achievement of $5.32 million in revenues in 2023 and its presence in over 50 countries indicate high market acceptance and the successful overcoming of such barriers, at least in certain segments of the market.
With a market growth rate of 20.5%, there is considerable opportunity for Sensate to continue its expansion and cement its position within this burgeoning sector. However, while the market is large and growing, Sensate's obtainable market share is likely a small fraction of the space. Health devices are a broad spectrum, including wearables and clinical monitoring. Sensate's global reach will help to expand the true market opportunity.
Team
Sensate is led by CEO Anna Gudmundson and Inventor Stefan Chmelik, whose combined expertise has positioned the company as a promising player in the wellness industry. Gudmundson, despite being a first-time founder, has high-level managerial experience at a wellness company as a turnaround CEO. Stefan Chmelik, the inventor behind Sensate's technology, contributes a wealth of experience, with 26 years in the clinical wellness space. Chmelik's extensive background is invaluable to Sensate, especially given the innovative nature of the company's product—a device that uses sonic resonance to calm the body's nervous system. His role as a repeat founder and full-time commitment to Sensate further enriches the company's strategic direction and product development efforts.
Together, Gudmundson and Chmelik form a complementary leadership team. Gudmundson's managerial prowess paired with Chmelik's deep industry knowledge drives Sensate's mission to revolutionize wellness technology. Their collaboration has already yielded significant achievements, including generating $5.32 million in revenues in 2023 and expanding the product's availability to over 50 countries.
Moreover, Sensate's ability to secure venture capital backing from notable investors such as TenOneTen, Unlock, Incisive, Expert DOJO, and Dangerous indicates confidence in the team's capability to scale the company. This external validation, combined with the founders' dedication, positions Sensate for continued growth and success in the wellness technology market.
Differentiation
Sensate has carved a distinctive niche in the wellness industry through its innovative approach to stress relief and wellness. The company's proprietary technology, which leverages sonic resonance to calm the body's nervous system, sets it apart from traditional wellness devices. By delivering immediate stress relief and relaxation within just ten minutes of use, Sensate offers a unique value proposition to its users.
While Sensate operates in a slightly competitive landscape with indirect competitors such as Calm and Headspace, focusing on mental wellness through audio experiences, and direct competitors including Apollo Neuro, Pulsetto, and Fisher Wallace, which offer physical devices aimed at stress reduction, Sensate's use of infrasonic therapy presents a novel approach. This technology not only distinguishes Sensate from app-based competitors but also offers a differentiated experience compared to other physical wellness devices. The recognition as TIME's Best Invention of 2022 further validates its innovative approach and market acceptance.
At $299, however, the Sensate device is on the expensive end of stress management wearables. Some potential users may be too cost-sensitive to opt for Sensate and find other offerings more accessible.
Performance
Sensate has demonstrated significant traction in the wellness industry, with notable achievements including generating $5.32 million in revenues in 2023 and selling its wellness technology devices in over 50 countries. This global reach is underscored by the delivery of over 58 million Sensate minutes worldwide, showcasing the widespread adoption and utilization of their product. The recognition of Sensate as one of TIME's Best Inventions of 2022 further validates the innovative nature and market acceptance of their sonic resonance technology.
The company's financial performance, highlighted by $15 million in lifetime revenues, indicates a strong market demand for their wellness solutions. This demand is supported by a broad distribution network that includes major retailers such as Walmart, Best Buy, LifeMD, Touch of Modern, Healf.com, Biohacker Center, Amazon, and Harrod's. The presence in such high-profile retail outlets not only amplifies Sensate's market visibility but also enhances its credibility and accessibility to consumers.
Despite these achievements, Sensate is in a pre-profit development phase, with a monthly burn rate of $322,106 and cash on hand of $516,068 as of their latest reporting. This financial position suggests a need for careful cash management and potentially further capital raising to sustain growth and operational activities. The lack of runway is a major risk investors should consider. Additionally, revenue appears to have stagnated over the past two years. Investors should carefully consider these risks and weigh them against Sensate's impressive traction.
Risk
Sensate, while showcasing potential in the wellness technology market, carries several risks that merit attention from investors. First among these is the company's financial health, indicated by a significant monthly burn rate of $322,106 contrasted against a cash position of $516,068. This high burn rate relative to available cash suggests a limited runway, which could necessitate additional fundraising in the near term to continue operations and growth efforts.
Additionally, Sensate operates in a market that, while growing, is characterized by a plethora of cheaper indirect competitors such as Calm and Headspace, alongside direct competitors Apollo Neuro, Pulsetto, and Fisher Wallace. This competitive landscape may pose challenges in customer acquisition and retention, with Sensate needing to continuously innovate and differentiate its offering to maintain and grow its market share.
From a production standpoint, Sensate’s dependence on hardware manufacturing introduces risks related to production and quality control. Hardware production often entails navigating supply chain complexities, managing production costs, and ensuring consistent product quality - any of which can impact product availability, cost structure, and customer satisfaction.
It is also crucial to note that the company experienced a slight revenue decline of 3.19% from the previous fiscal year. This decline, though modest, underscores the importance of closely monitoring sales trends and market demand moving forward.
Lastly, Sensate's short-term debt level at $3,301,963, coupled with a net income loss of $3,865,272 for the most recent fiscal year end, underscores financial risks associated with debt management and profitability. This level of financial leverage and operational loss necessitates a robust plan for achieving profitability and managing debt obligations effectively.
Bullish Outlook
With a product that delivers stress relief and relaxation in a mere ten minutes, Sensate addresses a universal need in today's fast-paced world. The company's ability to generate $5.32 million in revenues in 2023 speaks volumes about the product's market acceptance and demand.
One of Sensate's most compelling strengths is its global reach, with the product sold in over 50 countries. This widespread distribution underscores the universal appeal of stress relief solutions and highlights Sensate's potential for further international expansion. Additionally, the company's commitment to innovation is evident in its investment in research and development, product and manufacturing improvements, and subscription services. These efforts not only enhance the product's effectiveness but also open up new revenue streams through recurring subscriptions.
The backing by venture capital investors, including notable names such as TenOneTen, Unlock, Incisive, Expert DOJO, and Dangerous, provides Sensate with the financial support necessary to fuel its growth and expansion efforts.
Furthermore, Sensate's patented technology distinguishes it in a slightly competitive market. The company’s unique infrasonic therapy, coupled with an immersive soundscape experience via an app, offers a differentiated product that not only attracts customers but also builds a barrier against competitors. The company’s intellectual property solidifies its competitive advantage and supports long-term sustainability in the market.
Bearish Outlook
The financial and competitive landscape surrounding Sensate presents several concerns that underpin a bearish outlook for the company. Despite its innovative approach to stress relief through sonic resonance technology, Sensate faces significant obstacles on its path to sustainable profitability and market dominance.
One of the primary concerns is Sensate's high monthly burn rate of $322,106 against a backdrop of declining revenue. The company witnessed a -3.19% decrease in annual revenue. While Sensate achieved $5.32 million in revenues in 2023 and operates in over 50 countries, this revenue decline, coupled with a substantial burn rate, raises questions about the company's financial management and its ability to achieve profitability in the near term.
Furthermore, Sensate operates in a market with plenty of more accessible competition. At $299 per device, Sensate may be inaccessible to price-conscious customers. Calm, Headspace, and other meditation apps offer a cheaper alternative for a large share of the market. Though they do not provide an identical solution, these apps may be a customers only option in their price range.
Executive Summary
Sensate has introduced a stress-relief device that leverages sonic resonance to provide relaxation and stress reduction. The company's patented technology, which has been featured in major publications such as TIME, BBC, Forbes, and Vogue, offers a unique solution to the growing problem of chronic stress and anxiety. With $5.32 million in revenues in 2023 and a product sold in over 50 countries, Sensate has demonstrated significant traction and market acceptance. The device's accolade as one of TIME's Best Inventions of 2022 further validates its impact and potential in the wellness market.
However, Sensate faces challenges typical of startup companies, including a high monthly burn rate of $322,106 and a net income loss of $3,865,272 in the most recent fiscal year. These financial metrics indicate large financial risks that investors should consider.
The company's strategy to develop a recurring revenue model through subscriptions could provide a more sustainable path to profitability and long-term growth. As Sensate continues to innovate and expand its product offerings, it represents a compelling opportunity in the wellness technology space, though not without risk.
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Company Funding & Growth
Funding history
- Total Prior Capital Raised
- $7,125,650
- VC Backed?
- Yes
Growth Charts
Revenue History
Note: Revenue data points reflect the latest of either the most recent fiscal year's financials, or updated revenues directly from the founder, at each raise's close date.
Valuation History
Price per Share History
Note: Share prices shown in earlier rounds may not be indicative of any stock splits.