LifeBridge 10000 is raising through a SAFE at a valuation cap of $25 million and a discount rate of 22%. It isn’t unusual for medical technology companies to be valued highly, and the discount does make the price somewhat more appealing. However, comparing this price to LifeBridge’s 2020 revenue results in a revenue-to-valuation multiple of around 586x, which is extremely high. LifeBridge’s pre-money valuation during its previous raise came in at just over $12 million. The startup’s progress since then doesn’t justify more than doubling that value. As a result, LifeBridge is overvalued in this round.

LifeBridge 10000’s Adaptive Tumor Treating Field (ATTF) device has potential applications across the global metastatic cancer treatment market, which was valued at $63 billion in 2019. As rates of diagnosed cancer grow, this market is expected to expand 7.3% annually and reach a size of $111.16 billion by 2027. ATTF won’t be the best treatment of all kinds of cancers, but there remains plenty of room in this space for it to take a prominent place. Research suggests that incidence of cancer in the US will increase by nearly 50% between 2015 and 2050 as the population ages. This is truly a market that will be growing for the long haul. As a result, LifeBridge has plenty of opportunity to grow and scale within this market.

CEO and co-founder Peter Travers was inspired to create LifeBridge after efforts to treat his wife’s cancer with tumor treating fields (TTF) were only partially successful. Travers holds a BA in communications from the University of Central Florida. He founded Vision Multimedia Communications in 1977, a marketer for patient education materials on various medical subjects. After two decades building his own businesses, he engaged in marketing consultant roles for several years until he again became self-employed with Comprehensive Loyalty, Inc. Across his career, he has mainly focused on providing marketing consulting services. LifeBridge is a unique entry in that career as a medical startup developing its own product. While he does not have any medical or technical expertise, his marketing skills will be very useful once LifeBridge is ready to fully enter the market.

Co-founder and Chief Technologist Ken Watkins led the development of the LifeBridge 10000 wearable system and holds an MS in electrical engineering from the University of New Mexico. He spent 27 years in electrical engineering roles with Northrop Grumman, eventually managing a team designing laser equipment for military customers. Since leaving Northrop Grumman, he has served as a professor at Seminole State College in Florida, where he teaches electrical engineering fundamentals. Watkins brings technical expertise to the team in his ongoing leadership role. While he is clearly still committed to his university position, that role offers him potential academic contacts which could benefit LifeBridge as it conducts further trials.

LifeBridge’s leadership team has been filled out with high level executives such as Vice President of Corporate Development Rick Rotondo, Senior Engineer Timothy Vandermey, and Head Programmer Scott Krywick. The team has a diverse and relevant skill set for the most part, though it has no track record of exits. LifeBridge has a strong team that looks capable of leading it to further growth and possible success.

Medical device markets are highly lucrative with immense margins. However, they are strictly regulated and have massive barriers to entry. LifeBridge 10000’s more than a half-decade of development without profit is evidence enough of that. However, the company has taken that time to build up the defensibility of its Adaptive Tumor Treating Field (ATTF) system with patent protection in eight countries, including two US patents. LifeBridge’s most prominent competitor is Novocure, which has been developing tumor treating field (TTF) treatments since 2000. Novocure pioneered TTF treatments but doesn’t have a solution for diffuse metastatic disease. Other companies, such as Pfizer are investing in TTF treatments as well. Pfizer has also put funds into Novocure.  

That said, TTF is far from the only treatment for cancer and has yet to be proven effective for many kinds of cancer. Product differentiation will come if the ATTF system can be shown to provide superior results to other treatment options in human trials. It will also likely stand out as a treatment option without many deleterious side effects like hair loss. The product’s noninvasive nature is a huge selling point for patients concerned about maintaining quality of life. While full market-fit has not been proven, LifeBridge has made strong progress in developing a promising medtech device. The company is well-differentiated from its competitors and has strong defensibility.

Due in part to its expensive and lengthy development process, LifeBridge 10000 has yet to become profitable. Its second version of the Adaptive Tumor Treating Field is still going through trial and certification processes. LifeBridge took in only $42,650 in revenue last year, down from $58,453 the year before. The business has limited its burn rate to around $25,000 per month as of last year. It has also taken in significant capital through fundraising, with $1.3 million in a friends-and-family raise. The startup still has a ways to go before it can begin scaling up and selling its device commercially. However, it is relatively far along in the development process and has plenty of prior funding, so LifeBridge is well-positioned for future success.

An investment in LifeBridge 10000 comes with a high risk profile. The company’s main selling point is that its Adaptive Tumor Treating Field system is superior to Novocure’s options and can treat metastatic cancers in multiple locations. However, the device still requires animal and human testing before it can be proven effective. The cancer cure market is competitive among what limited companies can provide services, and regulation is a significant hurdle that LifeBridge faces. As such, product and legal risk are elevated.

In addition, the company will require significant further funding to continue patent applications, trials, and documentation filing. The need for funding will only increase as it reaches full product approval, scales up production, and begins marketing to potential clients. Such funding concerns are likely to last even longer as LifeBridge implements a long-term strategy aimed at providing its services to under-resourced populations. Finally, there is the challenge of breaking into the market itself, as the experimental tumor treating field treatment goes up against more established treatment methods such as chemotherapy. These challenges contribute to elevated time and funding risk scores. Finally, the company is raising on a SAFE, slightly increasing the risk associated with investment terms.

LifeBridge 10000 has undeniable potential for a breakthrough in cancer treatment. However, it is not the first to market, and it hasn’t truly reached the market yet. Without full FDA approval and successful animal and human trials, its product won’t be considered viable. LifeBridge had a developed and tested prototype in 2017 but is still pre-profit four years later. Combining these remaining hurdles with a lengthy timeline and an unfavorable price, investors take on considerable risk in this raise.

Cancer is a serious problem that is likely to grow more severe. Evidence of this can be found in the federal government’s Cancer Moonshot initiative, the funding of which has resulted in scientific breakthroughs since passage of the 21st Century Cures Act in 2016. As the US population ages, demand for non-invasive cancer treatments could easily skyrocket. This isn’t just a US problem — cancer is a prominent killer around the world. Should LifeBridge 10000’s technology make it through testing and regulatory hurdles, it will be a prime candidate for acquisition. 

If LifeBridge can bring its Adaptive Tumor Treating Field device to market, it could revolutionize how metastatic cancer, the deadliest form, is treated. It could reduce cancer from incurable to merely chronic, and technology that is lifesaving is incredibly profitable.

LifeBridge 10000 is expanding the use of tumor treating fields to treat metastatic cancers that are incurable through other means. Its patented wearable device can combat solid tumor cancers in multiple locations, preventing the painful choice of targeting cancer in one location or the other.

LifeBridge is still in the pre-revenue phase and needs to conduct further human and animal trials before bringing the device to market. In addition, while the device has potential to revolutionize the market, a $25 million valuation cap is much too high to make a tempting deal for investors. 

Still, the leadership team brings complementary skills together, and the market is going to grow sustainably for the foreseeable future. In addition, LifeBridge has already seen success in prior fundraising, and its technology is unmatched in its potential to treat America’s second-biggest killer while maintaining quality of life. For these reasons, LifeBridge 10000 has been rated a Neutral Deal.

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Analysis written by Benjamin Potts.