Exo took a big step towards making its handheld ultrasounds easier to use and adopt, acquiring AI startup Medo AI. Although unexpected, this is a logical and potentially significant acquisition that deserves a deeper look…
Exo plans to integrate Medo’s Sweep AI technology into its ultrasound platform, forecasting that this hardware-software combination will streamline Exo POCUS adoption among clinicians who lack ultrasound training/experience.
- Medo’s automated image acquisition and interpretation software has clearance for two exams (thyroid nodule assessments, developmental hip dysplasia screening), and it has more AI modules in development.
Exo didn’t disclose acquisition costs, but Medo AI is relatively modest in size (23 employees on LinkedIn, no public info on VC rounds) and it’s unclear if it had any other bidders.
- Either way, Exo can probably afford it following its $220M Series C in July 2021 (total funding now >$320m), especially considering that Medo’s use case directly supports Exo’s core strategy of expanding POCUS to more clinicians.
Some might point out how this acquisition continues 2022’s AI shakeup, which brought three other AI acquisitions (Aidence & Quantib by RadNet; Nines by Sirona) and at least two strategic pivots (MaxQ AI & Kheiron).
- That said, this is the first AI acquisition by a hardware vendor and it doesn’t represent the type of segment consolidation that everyone keeps forecasting.
Exo’s Medo acquisition does introduce a potential shift in the way handheld ultrasound vendors might approach expanding their AI software stack, after historically focusing on a mix of partnerships and in-house development.
Handheld ultrasound is perhaps the only medical imaging product segment that includes an even mix of the industry’s largest OEMs and extremely well-funded startups, setting the stage for fierce competition.
That competition is even stronger when you consider that the handheld ultrasound segment’s primary market (point-of-care clinicians) is still early in its adoption curve, which places a big target on any products that could make handheld ultrasounds easier to use and adopt (like Medo AI).