China’s BrainCo pushes wearable brain tech as implants draw attention

Brain-computer interfaces are moving from lab demos toward real products, and China’s BrainCo is taking a different route from implant-focused rivals such as Elon Musk’s Neuralink. For investors watching the next wave of health tech, the split matters because wearable systems could face lower adoption hurdles, while implanted devices may still deliver stronger signals for some medical uses.

A brain-computer interface, or BCI, reads brain activity and turns it into commands for an outside device. CNBC reported that companies in the U.S. and China are racing to develop the technology, with some using surgery to place implants and others trying to avoid the skull altogether.

Neuralink has become the most visible name in the field with implanted devices aimed at helping people with disabilities. CNBC reported that BCI milestones already include helping people with degenerative conditions, including amyotrophic lateral sclerosis, type or play video games using brain signals.

BrainCo’s non-invasive bet

BrainCo, founded in 2015 and based in Hangzhou, makes prosthetics and wearable devices using BCI technology, according to CNBC. The company came out of Harvard Innovation Labs and is considered one of Hangzhou’s “six little dragons” of tech startups.

Nyx He, BrainCo partner and senior vice president, told CNBC that implanted and non-invasive systems address different problems. She said some conditions require going into the brain, while BrainCo believes many others can be treated with non-invasive methods that are easier to access and accept, with lower risk and cost.

The company’s bionic hands, approved by the U.S. Food and Drug Administration, read neural and muscle-related electrical signals from an amputee and convert intended movements into finger motion, CNBC reported. BrainCo also sells wearables, including a sleep aid that the company says uses low-intensity electrical pulses to stimulate neurochemicals tied to stress relief.

BrainCo has raised 2 billion yuan, or about $280 million, in a funding round co-led by IDG Capital and Walden International, CNBC reported. Walden International was founded by Intel CEO Lip-Bu Tan.

He told CNBC that the main technical challenge for non-invasive BCI is reading and interpreting weak, noisy signals from outside the skull. BrainCo developed a dry electrode sensor to capture those signals and an artificial intelligence algorithm to decode them, according to He.

From medical use to consumer devices

BrainCo’s plan starts with people who need the technology most, including amputees in insurance-covered markets, He told CNBC. The company then wants to expand into conditions such as ADHD and depression before targeting consumer electronics.

Longer term, BrainCo plans to license its BCI platform to other companies building brain-tech products. He told CNBC she expects that licensing business to become the company’s biggest revenue driver.

Rui Ma, founder of Tech Buzz China, told CNBC that current BCI applications can improve life for severely impaired patients, while a larger market may eventually come from augmenting human abilities. She added that no company appears close to making that broader market real, calling augmentation “sci-fi” at this stage.

China builds a policy push

China has made BCI a strategic “future industry” in its latest Five-Year Plan, CNBC reported. Seven ministries issued an implementation plan last August targeting key technology breakthroughs by 2027, and Anhui province published a June action plan to speed BCI research, production and industrialization.

Regulators recently approved what officials call the world’s first minimally invasive BCI device for commercial use, developed by Neuracle Medical Technology to help restore some hand function after spinal cord injuries, according to CNBC.

Jefferies said in a July 8 report that China’s BCI market is developing first in non-invasive rehabilitation technologies because they face lower regulatory and clinical barriers. The bank said implanted systems and ultrasound-based approaches are among the most promising frontiers, while conventional non-invasive systems remain limited by signal clarity.

Paul Triolo, a partner at DGA-Albright Stonebridge Group, told CNBC that Beijing is treating BCI as part of a broader industrial policy effort, including the supply chain. He said China’s focus stretches from stroke rehabilitation and prosthetics to cognitive assessment.

BrainCo’s He told CNBC the company does not collect customer data. She said data is stored on users’ devices, not sent to the cloud, and erased after each use, while some information such as concentration scores can be saved locally on focus-training devices.

This story draws on original reporting from CNBC.