Aug 6, 2008
By: Alvaro Fernandez
The August issue of Venture Capital Journal brings a very good piece on the emerging brain fitness software (also called “neurosoftware”) category:
— Mind Games (subscription required)
— Dakim, Lumos Labs, Posit Science and other brain fitness startups are starting to gain mind share and capital from venture firms.
The reporter and I spoke as Lumos Labs received its $3m round, and we discussed other fundable start-ups, featuring CogniFit. Which, as mentioned over the weekend, just raised $5m.
If case you are a new SharpBrains reader, perhaps visiting us after reading this VCJ article, let me provide a quick overview of the category and our Market Report (which is annual, not quarterly as the article states):
We estimate the size of the US brain fitness software market at $225M in 2007, up from $100m in 2005 (50% CAGR), analyzing the size and trends of four customer segments: consumers, healthcare & insurance providers, K12 school systems, and fortune 1000 companies, military, and sports teams. Two segments fueled the market growth from 2005 to 2007: consumers (grew from $5m to $80m, 300% CAGR) and healthcare & insurance providers (grew from $36m to $65m, 35% CAGR).
Ten Specific Highlights from The State of the Brain Fitness Software Market 2008 report include:
1) 2007 was a seminal year for the US Brain Fitness software market, which reached $225 million in revenues up from an estimated $100 million in 2005.
2) Over 20 companies are offering tools to assess and train cognitive skills to four customer segments: consumers; healthcare and insurance providers; K12 school systems; and Fortune 1000 companies, the military, and sports teams.
3) The Nintendo Brain Age phenomenon has driven much of the growth. The consumer segment grew from a few million in 2005 to an estimated $80 million in 2007.
4) There is major confusion in the market, so education will be key. Users and buyers need help to navigate the maze of products and claims.
5) Over 400 residential facilities for older adults have launched computerized brain fitness centers. Sales to the healthcare and insurance provider segment grew from $35 million in 2005 to an estimated $65 million in 2007.
6) More than five programs have shown results in randomized controlled trials. Cognitive functions that can be trained include: visual and auditory processing, working memory, attention, and decision-making.
7) A product has obtained 510(k) FDA clearance for rehabilitation of stroke and Traumatic Brain Injury patients. Another product is being used by a growing network of ADHD specialists.
8) Large-scale, fully-automated cognitive assessments are being used in a growing number of clinical trials. This opens the way for the development of inexpensive consumer-facing, baseline cognitive assessments.
9) The potential for K12 Education remains largely untapped due to limited research linking cognitive training to academic performance.
10) Companies, sports teams and the military are finding opportunities to improve productivity. The aging workforce will make this a must.
Chapter 1: Why now? Market Overview
- Brain fitness software market: the focus of this report
- Four customer segments of the brain fitness industry
- Part of the larger neurotechnology market
- Brain fitness became a media darling in 2007
- Confluence of market forces drives growth
- Demand: range of consumers and institutional buyers of brain fitness products
- Science: new findings spark focus on brain fitness market
- Supply: separating hype from reality in the claims of brain fitness software products
- Policy: brain fitness starting to shape public policy agenda
- Navigating the brain fitness software program landscape
- Interview with Dr. Yaakov Stern – The connection between building a cognitive reserve and delaying alzheimer’s symptoms
Chapter 2: The Science of Brain Fitness
- New brain paradigm: lifelong capacity to change and create new neurons
- Neuroimaging: enabling scientific exploration of the brain
- Cognition: core brain function
- Some cognitive functions improve as we age others typically decline
- The four pillars of brain health
- Software-based brain fitness programs: effective to train specific skills
- Cognitive assessments: critical to identify bottlenecks and measure progress
- Cross-training the brain builds up the cognitive reserve
- An emerging field: much more research needs to be done
- Interview with Dr. Jerri Edwards – Improving Brain Functioning for better Driving and Aging
Chapter 3: Consumers Taking Charge of Their Brain Health
- Nintendo creates global awareness for brain training
- Growing appetite for casual games among players over forty
- Baby boomers move the market by sheer size
- Consumer interest in health and wellness
- Growing concerns about herbal supplements
- Commercial software products flood market with inconsistent claims
- A number of critical questions remain unanswered
- Company profiles: select consumer brain fitness products
Chapter 4: Healthcare and Insurance Providers Focus on Preventive Health & Clinical Conditions
- Brain fitness centers becoming mainstream in residential facilities
- A major incentive for insurers: delaying the onset of Alzheimers symptoms
- Emerging clinical applications
- Stroke/ Traumatic Brain Injury Rehabilitation
- Attention Deficit Disorders
- Potential future clinical applications
- Use of computer-based cognitive assessments in large-scale clinical trials
- Open questions
- Company profiles: select brain fitness products sold through healthcare or insurance providers
- Interview with Torkel Klingberg Expanding Working Memory for kids with ADD/ ADHD
- Interview with Elizabeth Zelinksi Healthy Aging Enhanced with Computer-based Programs
Chapter 5: K12 School Systems Responding to Learning Disabilities in New Ways
- Early K12 brain fitness applications
- Mismatch between academic needs and the claims of existing offerings
- A great resource: the US Department of Educations What Works Clearinghouse
- Scientific Learnings history and plans
- What Works Clearinghouses take on Fast Forword
- Houghton Mifflins Earobics
- Other program developers
- Open questions
- Interview with Dr. Bradley Gibson Linking Computer-based Cognitive Training to Academic Performance
Chapter 6: Fortune 1000 Companies, Military & Sports Teams Improving Productivity
- Fortune 1000 companies increase health & wellness budgets
- In light of the aging workforce, a focus on brain fitness is a logical extension
- In companies starting to embrace serious games, brain fitness may be a new application
- Military and sports teams leverage new brain fitness technologies
- Programs to improve driving skills proliferate
- Few pure-breed players, but some market leaders are starting to take notice
- Interview with Dr. Daniel Gopher Applications for Computer-based Cognitive Simulations
Chapter 7: Future directions: market trends 2007-2015
C) Companies Included in the report:
Advanced Brain Technologies
Applied Cognitive Engineering
Brain Resource Company
CNS Vital Signs
Cognitive Drug Research
Scientific Brain Training