Gestala, a Chinese BCI Startup, Secures $21.6 Million in Oversubscribed Round, Intensifying Global Race for Brain-Computer Interface Dominance

The global landscape of brain-computer interface (BCI) technology is experiencing a rapid acceleration, fueled by significant investments and breakthroughs. At the forefront of this innovation race are prominent U.S. players like Elon Musk’s Neuralink, known for its implantable BCI systems, and Merge Labs, a startup backed by OpenAI and co-founded by Sam Altman, which is focusing on non-invasive ultrasound BCIs. Mirroring this ambition, Chinese serial entrepreneur Phoenix Peng is establishing a formidable rival presence with two distinct ventures: NeuroXess, which is developing advanced implantable BCI systems, and Gestala, his second company, dedicated to pioneering non-invasive, ultrasound-based BCI technology.

Gestala, despite being only two months old, has already demonstrated remarkable traction, successfully raising $21.6 million (CN¥150 million) in a highly competitive funding round. This early-stage investment places the company’s valuation between $100 million and $200 million, a testament to the immense investor confidence in its technology and market potential, as confirmed by founder and CEO Phoenix Peng in an exclusive interview with TechCrunch. The funding round saw robust participation, co-led by prominent investors Guosheng Capital and Dalton Venture. Further strategic investment came from Tsing Song Capital, Gobi Ventures, Fourier Intelligence, Liepin, and Seas Capital. Peng revealed that the round was heavily oversubscribed, with investor commitments ultimately totaling more than $58 million, significantly exceeding the target amount.

This substantial early-stage funding represents the largest of its kind within China’s burgeoning BCI industry, underscoring the escalating pace of innovation and investment in the sector. The capital infusion will be strategically deployed to fuel Gestala’s aggressive growth plans. A significant portion is earmarked for accelerating research and development efforts, crucial for refining its nascent technology. Furthermore, the company plans a substantial team expansion, aiming to grow its current workforce of 15 to approximately 35 employees by the end of the year, bringing in top-tier talent across engineering, neuroscience, and manufacturing. A critical objective for the three-month-old startup is the establishment of a dedicated manufacturing facility within China, which will be instrumental in scaling production and ensuring the efficient development of its devices. Gestala’s ambitious timeline targets the completion of its first-generation prototype by the close of the current year.

The global BCI industry is currently witnessing a pronounced surge in investment specifically directed towards ultrasound technology. Gestala distinguishes itself as the first company in China to concentrate on ultrasound BCI, though it is not the first globally. The United States has seen the emergence of several ultrasound BCI startups in recent years, with Merge Labs standing out as one of the largest and most promising contenders in this innovative field. This global trend highlights a growing consensus among researchers and investors regarding the potential of ultrasound as a groundbreaking method for brain-computer interaction.

Phoenix Peng firmly believes that ultrasound technology holds the key to the next generation of brain-computer interfaces. He envisions a future where ultrasound can offer unprecedented broad, whole-brain access, enabling entirely new paradigms for interacting with and understanding neural activity. One of the most significant advantages of non-invasive ultrasound, as articulated by Peng, is its ability to overcome a major barrier to widespread BCI adoption: the inherent risks associated with invasive brain surgery. Unlike implantable electrode systems, which necessitate complex surgical procedures, non-invasive ultrasound technology can monitor a considerably larger portion of the brain, crucially including deep neural circuits that are challenging to access with surface-level or even minimally invasive techniques. Moreover, by employing sophisticated phased-array ultrasound technology, Gestala’s system aims to precisely stimulate or suppress neural activity without the need for any surgical intervention, offering a safer and more accessible pathway to BCI applications.

Despite the prevailing geopolitical tensions between the United States and China, Phoenix Peng remains optimistic about the potential for collaboration in deep-technology research. He emphasizes that both nations possess unique and complementary strengths that, if combined, could significantly advance the field of neuroscience and BCI. Peng highlighted that "China offers large-scale clinical research capacity and efficient supply chains," which are invaluable for rapid testing and production. In contrast, he noted that "the U.S. has world-class scientific talent," providing a deep well of foundational research and innovation. He suggested that joint efforts could particularly focus on building expansive clinical datasets, which are essential for training advanced AI models and supporting global neuroscience research, thereby benefiting humanity as a whole.

Gestala is actively exploring a diverse range of applications for its cutting-edge technology, targeting both immediate and long-term medical needs. Medically, chronic pain management stands as the startup’s leading program. Chronic pain represents a pervasive global health challenge, affecting vast populations in both the U.S. and China, often with limited effective treatment options. Peng cited existing academic studies that suggest ultrasound stimulation can significantly reduce pain levels, offering a promising, non-pharmacological therapeutic avenue.

Beyond chronic pain, the startup is also deeply engaged in studying applications for various mental health conditions, including depression, post-traumatic stress disorder (PTSD), autism, and obsessive-compulsive disorder (OCD). Furthermore, Gestala is investigating the technology’s potential in stroke rehabilitation, an area where innovative approaches are desperately needed to restore neurological function. Longer-term targets for the company include debilitating neurological disorders such as Alzheimer’s disease, essential tremor, and Parkinson’s disease. In total, Gestala is actively researching six to eight potential indications, though most of these remain in the early research stage rather than in advanced clinical trials, reflecting the nascent nature of the technology and the extensive validation required.

Gestala posits that its primary advantage over global rivals stems from its inherent speed and ability to scale operations efficiently. By strategically leveraging China’s highly integrated and sophisticated manufacturing ecosystem, the startup believes it can accelerate its journey from development to full-scale production far more rapidly than many international competitors. This streamlined process, from design to fabrication, provides a significant competitive edge in a fast-evolving technological landscape.

In addition to manufacturing prowess, the company is actively collaborating with major Chinese hospitals to significantly accelerate clinical trials. This partnership allows Gestala to conduct crucial human studies at substantially lower costs—estimated to be roughly 20% to 33% of comparable studies conducted in the U.S. or Europe. This cost efficiency and speed are critical for bringing new medical devices to market. Concurrently, Gestala is meticulously building what it terms an “Ultrasound Brain Bank”—a vast and comprehensive clinical dataset. This ambitious initiative is designed to train advanced artificial intelligence models to accurately decode complex brain signals, thereby supporting future neurological diagnostics and personalized therapeutic interventions, marking a significant step towards precision medicine in neurotechnology.