Just a couple of weeks ago, at the end of May, Neuralink was granted permission to test its controversial brain chips on humans, a key decision for the company and its shareholders. The approval of the United States Food and Drug Administration (FDA) accelerated the appreciation of Elon Musk’s startup, which reached 5,000 million dollars in record time and could reach 7,000 million soon.
According to a report from Reuters2 years ago Neuralink was valued at 2,000 million dollars, after raising 205 million in a financing round.
Since then, the South African billionaire’s company has added $3bn to its estimated valuation, currently trading at about 5 billion dollars. The informants cited estimate that the value of the shares held by some of the employees have shot up 150% in these 2 years.
What is Neurallink?
Neuralink aims to introduce neural interface technology that can stimulate brain activity. These brain implants could help in the treatment of neural disorders and other medical conditions.
The company ensures that its chips will be able to record brain activity to transmit orders that help restore some brain functions, such as speech or movement in the hands, arms and legs; for example, in patients suffering from partial or total paralysis.
Although other brain-computer interfaces exist, Neuralink seeks to be the first to improve cognitive functioning.
This means that the implants could enhance the capacity of the human brain so that it can compete, from a more equal position and if necessary, with technologies such as artificial intelligence and other more advanced ones that emerge in the future.
Of course, Elon Musk’s project goes much further. The almost 52-year-old tycoon has said that, in the future, this technology could open the door to comprehensive mental health treatment and even telepathy. It would also represent the maximum brain-machine connection integration, since it would allow actions such as managing software and devices with the mind.
Neuralink had planned to start human trials in 2022, but the FDA delayed it, citing safety concerns, allegations of animal cruelty and other conflicts of interest.
Elon Musk’s startup could reach $7 million
The agency explains that this growth is due to “privately executed secondary trading,” according to several sources close to Neuralink.
Secondary operations are those carried out by existing shareholders, such as employees and early investors. These have a small volume, which can distort valuation estimates. In contrast, fundraising rounds or initial public offerings seek to attract new investors on a broader scale.
The secondary exchanges and the $5 million valuation took place before getting FDA approval to start human brain trials. Now, that ‘green light’ from the US authorities, received on May 25, seems to have revived the enthusiasm of investors and private transactions.
The report notes that, after the FDA ruling and in recent days, Neuralink’s shares have been offered to investors privately for $55 each, according to an email seen by Reuters. They calculate that this price implies a valuation of 7,000 million for Elon Musk’s startup, but so far it is unknown if they have found buyers at that price.
Editorial Team The editorial team of EMPRENDEDOR.com, which for more than 27 years has worked to promote entrepreneurship.