Eargo Raises $71 Million To Help People With Hearing Loss

By Dan Anderson ● July 29, 2020
  • Eargo — a medical device company that is on a mission to improve the quality of life of people with hearing loss — announced it raised $71 million in equity financing

Eargo — a medical device company that is on a mission to improve the quality of life of people with hearing loss — announced it raised $71 million in equity financing led by new co-investors Gilde Healthcare and Longitude Capital with participation from existing investors New Enterprise Associates (NEA), the Charles and Helen Schwab Foundation, and Nan Fung Life Sciences.

In connection with the funding round, Geoff Pardo of Gilde Healthcare and Juliet Tammenoms Bakker of Longitude Capital will join Eargo’s Board of Directors.

Eargo is dedicated to improving the quality of life of people with hearing loss. And the company’s product and go-to-market approach addresses the major challenges of traditional hearing aid adoption, including social stigma, accessibility, and cost. Consumers are able to purchase online or over the phone and get personalized and convenient consultation and support from licensed hearing professionals via phone, text, email, or video chat. And the Eargo solution is offered to consumers at about half the cost of competing hearing aids purchased through traditional channels in the US. The company’s 4th generation product — which is the Eargo Neo HiFi — was launched in January and features improved capabilities across audio fidelity and bandwidth.

This round of funding provides Eargo with additional capital to expand commercialization during a period of accelerated consumer demand for its direct-to-consumer hearing loss solution. And Eargo has removed the traditional barriers preventing people from taking control of their hearing loss.

With Eargo’s virtually invisible, rechargeable, completely-in-canal, FDA-regulated, exempt Class I hearing aid, online hearing screening, and telecare consultation and support, customers are able to learn about and purchase a highly advanced hearing solution from the comfort of their homes.

Eargo saw major revenue growth in 2020 with year-over-year growth accelerating in both Q1 2020 and Q2 2020.

KEY QUOTES:

“We are pleased to close on this financing round, which provides us with significant capital to fund our growth. While our business was performing well before COVID-19, the pandemic accelerated consumer demand for our hearing loss solution. More consumers who are reluctant to purchase their hearing aids through the traditional brick and mortar clinics have recognized the benefits of our solution.”

— Eargo president and CEO Christian Gormsen

“While it is estimated that approximately 43 million people in the US suffer from hearing loss, only approximately 27% own a hearing aid, largely due to the stigma and inconvenience of the traditional clinic-based model. Eargo has revolutionized the hearing loss solution, offering a highly advanced hearing solution available through a virtual clinic model. We’re excited to be a part of the Eargo team and their vision to transform this market, bringing it into the 21st century.”

— Geoff Pardo, General Partner at Gilde Healthcare

“A hearing solution developed with the consumer in mind was long overdue. Eargo has truly put the consumer first, from consultations and solution design to buying experience and highly rated customer support. We are delighted to partner with Eargo to help fuel the growth of this unique business.”

— Juliet Tammenoms Bakker, Managing Director and Founder of Longitude Capital

“We are delighted to welcome Gilde and Longitude as our new partners in transforming this industry and helping to fuel Eargo’s continued growth. We welcome Geoff and Juliet to the Board and look forward to their contributions in the years to come.”

— Josh Makower, General Partner of NEA and Chairman of the Board of Eargo