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Exclusive: Wavely Diagnostics nabs $1.4M for virtual pediatric ear care

an illustration of a childs ears and ears cropped out of money surrounded by colorful shapes

Illustration: Tiffany Herring/Axios

Wavely Diagnostics, whose app helps diagnose ear infections for children, raised $1.35 million in seed funding to accelerate its commercial launch, CEO Arna Ionescu Stoll tells Axios exclusively.

Why it matters: Providing telehealth to pediatric populations can prove difficult as children are often unable to describe their symptoms properly.

How it works: Seattle-based Wavely’s diagnostic app turns a smartphone into an acoustic tool that can detect fluid in a child’s ear, the leading indication of ear infections.

  • The process is noninvasive and painless, and it can spare parents a trip to urgent care or the emergency room.
  • Wavely’s smartphone platform, categorized as a Class 2 medical device and thus exempt from the FDA's 510(k) premarket notification requirements, is currently piloting with a leading U.S. health system.

What they're saying: "Pediatrics have been sort of locked out of telehealth and virtual care," Ionescu Stoll says.

  • "Fundamentally, mobile-based apps are lynchpins for health care systems and they can’t do it without at-home diagnostics and exams at scale — which is hard to achieve without the smartphone," she adds.
  • "From a medical perspective, there is a clear need for this product," says Sasha Schrode, partner at Robin Hood Ventures. "There has never been a good way to accurately diagnose otitis media, the medical term for an ear infection."
  • Schrode says Wavely's acoustic modality was particularly appealing, and notes the SBIR grant validates the strength of the company's data.

Details: The round was led by Robin Hood Ventures and included follow-on investments from WRF Capital, Ambit Health Fund, WXR Fund, Wealthing, Healthtech Capital and Princeton Alumni Angels.

  • This funding follows a $1.8 million Phase 2 Small Business Innovation Research (SBIR) grant award from the National Institute on Minority Health and Health Disparities in November 2022.
  • Ionescu Stoll says investors reached out to Wavely preemptively after news of the grant got out, characterizing the round as a seed extension.
  • This funding round closed in June, and the one prior in February of 2022, when it raised $2.2 million, Ionescu Stoll says.

What's next: "The runway on this capital should get us through 2024," Ionescu Stoll says.

  • The company is on a path to profitability, and the capital gives Wavely time to decide how quickly it wants to scale, she adds.
  • “Wavely’s platform will start with ear infections, laying the groundwork to then expand to provide the key diagnostic finding and enable virtual care for nearly 70% of other common pediatric conditions," she said.

Zoom out: Children in rural areas face myriad barriers to accessing care, amid hospital closures and increasing regionalization of care.

  • Wavely is currently in pilot conversations with health systems with "sizable rural populations," Ionescu Stoll says.

Zoom in: Wavely, whose app will be functional for iOS and Androids, is being used in a Phase 2 pilot with a U.S. health system after completing a successful Phase 1 pilot. 

  • Currently available to health care systems for pilots, the app will launch broadly in late 2023.
  • The company is also focusing on building its B2B business, funding early-stage studies to build proof-of-concept and secure buy-in with providers.
  • "In health care, it’s hard to do a direct-to-consumer (play)," says Ionescu Stoll. "You have to go the business-to-business route and that takes time."

Catch up quick: Founded as an academic spinout of the University of Washington in 2018, the company rebranded as Wavely Diagnostics in 2020.

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