Zoho invests USD 5 million in Voxelgrids for 25% stake

Chennai-based tech firm Zoho on Tuesday said it has invested Rs 35 crore in homegrown MRI tech startup Voxelgrids as part of its efforts to foster the development of deep technological capabilities and intellectual property (IP) in the country. The investment will be made in two tranches and Zoho would hold about 25 per cent share in the company.

Bengaluru-based Voxelgrids manufactures 1.5T Magnetic Resonance Imaging (MRI) scanners that are lightweight, mobile, and easy to install, operate and maintain even in remote locations such as small villages. The equipment also includes a proprietary software package for imaging purposes. It has over 20 employees. “One of the pressing concerns for the Indian economy today is the lack of indigenous industrial know-how and manufacturing capabilities. A healthy DeepTech ecosystem is vital to solving this issue and driving structural economic change,” Zoho co-founder and Chief Executive Officer Corp Sridhar Vembu told reporters.

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Voxelgrids is one of the few companies that is working to solve this problem with MRI machines entirely built in India, he said. “We need more such companies that can own and command this type of engineering know-how across different sectors. At Zoho, through relentless R&D over the past 25 years, we understand that the DeepTech ecosystem needs to be similarly endorsed by the patient, long-term investments,” he said. He added that Zoho, over the past many years, has invested about Rs 250 crore across various companies over a number of years.

“This (investment) is supporting very critical R&D projects. Today, a lot of VC investment is going into essentially marketing expenses, for products that have already been created, products that are not extremely R&D intensive, but Zoho is supporting companies where the investment amount is smaller but very critical R&D projects with long term gestation period,” he explained. Vembu added that the company offers “patient capital” and it will continue to engage with teams that are working on indigenous, innovative solutions.

Zoho has previously invested in companies like Signalchip (which develops semiconductor chips for 4G, LTE and 5G modems) and vTitan Corporation that launched patented syringe infusion pumps designed for patients under critical care. Talking about the investment in Voxelgrids, Vembu said: “Our mission is to invest in critical technology know-how in India. This (investment in Voxelgrids) fits very well with that mission”. Voxelgrids Chief Executive Officer and founder Arjun Arunachalam said in India, there are only 0.4 MRI scanners per thousand beds, with most of the access restricted to tier-I cities.

He noted that procurement of diagnostic imaging equipment is still an expensive affair for hospitals and clinics, the brunt of which is borne by patients. The Indian market is dominated by either imported machines or refurbished equipment. These machines are expensive and have high maintenance and operating costs, while for consumers, it involves high costs and a longer wait time for reports. “Voxelgrids’ indigenous MRI technology provides a next-generation, cost-effective alternative that enables healthcare facilities to save on capital and operational expenditure. DeepTech products, like ours, require a significant amount of time from completing the R&D to taking the product to market, and most often, this is the time where we face insufficient funding,” he said.

The investment from Zoho will help bridge this gap and speed up efforts to scale, Arunachalam added. Voxelgrids has developed multiple technologies related to MRI scanners based on custom cryogenics and innovative electronic design and is looking to monetise it through OEM (original equipment manufacturer) partnerships with other vendors in the field. The scanner can also be mounted on custom mobile platforms and transported to remote locations where the product can be made operational within a few hours.

Voxelgrids – which has previously received grants from Social Alpha (supported by Tata Trusts) and Biotechnology Industry Research Assistance Council (BIRAC) – also aims to have multiple full-fledged clinical sites before the end of the 2021-22 financial year. Arunachalam said Voxelgrids is a pre-revenue company but has four advance orders. “We were recently certified for commercial sales and will now work on GTM (go to market) to generate revenues. India is our first target market,” he added.