Winter coronavirus threat spurs new surge of startup activity
Published Date: 10/27/2020
Source: axios.com
U.S. coronavirus cases and hospitalizations are surging, with cold weather arriving before even the best-case scenario for a widely distributed vaccine. Now we're also beginning to see an increase in coronavirus-related startup funding, focused on both testing and pharma.Driving the news: Gauss, a Silicon Valley computer vision startup focused on health care, tells Axios that it's raised $10 million to accelerate development and commercialization of an at-home rapid antigen test for COVID-19.Gauss was founded in 2011 to focus on surgical bleeding, but earlier this year signed a partnership with biotech Cellex to create what would be the first rapid COVID-19 test that can be fully performed at home without involving a lab.CEO Sid Satish says that Gauss will file with the FDA for an emergency use authorization "in days not weeks" and will release its data soon.The 4100 Group led the round, and was joined by return backers SoftBank Ventures Asia, Northwell Health, Providence Health and Services, OSF Healthcare, and Polaris Partners.Other deals have included a $215 million infusion for antiviral treatment developer Atea Pharma (which is now nearing an IPO) and a $100 million deal for portable testing company Cue Health.Between the lines: The big concern for venture capitalists is that some startups will put too many eggs in the COVID-19 basket, and then be stuck when demand shifts.Satish says his company is trying to mitigate that risk by maintaining its pre-pandemic products and customers, but adds that controlling spread is just an initial application for COVID-19 testing."You'll need some overlap of testing as a safety net and bridge to when a significant portion of people have been vaccinated. And, even with a vaccine, I think easy rapid testing will be a long-term necessity as a risk reduction method."