Youfang Medical Completes RMB 50 Million Pre-A Financing to Advance Next-Generation CT Imaging Technology

On July 25, VCBeat (WeChat ID: vcbeat) learned that YOFO announced the completion of its RMB 50 million Pre-A financing round. The round was led by Huaying Investment, with follow-on investments from Huami Technology and Anhui Guoyuan Fund. The proceeds will be used for applying for NMPA medical device registration certificates, as well as for equipment production and sales.

YOFO, established in 2017, is a cutting-edge medical device company dedicated to the research and development of next-generation CT imaging technologies. Its core technological advantage lies in flexible and adaptable imaging algorithm designs that optimize data acquisition patterns, thereby enhancing product performance while reducing production costs, ultimately improving overall cost-effectiveness. YOFO employs open-system technology, with its core imaging algorithms designed to be applicable across various clinical CT applications. The company has filed 35 domestic patents and 2 international patents.

Regarding the details of this round of financing, VCBeat conducted an exclusive interview with Dr. Zhu Lei, Founder and CEO of YOFO, to analyze from multiple perspectives why YOFO has attracted significant investor interest.

Oral CBCT equipment is an X-ray imaging system specifically designed for the characteristics of the oral and maxillofacial region. With the aid of CBCT, dentists can detect and treat oral diseases and perform surgeries that were previously impossible. It can be said that oral CBCT equipment is a revolutionary tool in dentistry.

CBCT is the abbreviation for Cone Beam CT, also known as Open CT due to its open design. Building upon traditional spiral CT, Cone Beam CT (CBCT) has upgraded the scanning and data acquisition methods. Its principle involves an X-ray generator performing circular digital irradiation around the subject at a lower radiation dose (typically with a tube current of approximately 10 mA). After acquiring hundreds of two-dimensional projection images, three-dimensional images are reconstructed via computer processing. Through improvements in data acquisition, CBCT not only enhances the scanning resolution of medical imaging but also reduces radiation exposure to a new level.

“Conventional CT is primarily used for precise whole-body imaging, whereas the advantage of CBCT lies in imaging single lesions,” stated Dr. Zhu Lei. The dental market is one of the forefront areas for CBCT development. Although CBCT technology has been developing in China for many years, there remains a significant gap compared to international cutting-edge standards. This is specifically reflected in outdated imaging algorithms and excessive image errors; the adoption of traditional data acquisition structures results in low cost-effectiveness for large field-of-view systems; and prolonged computation times for low-dose imaging have kept it largely at the stage of theoretical validation, with minimal practical application.

YOFO's Large-Field-of-View Dental CBCT System

In response to this, YOFO has developed a new-generation large-field-of-view dental CBCT system. Technologically, YOFO boasts globally unique parallel scanning technology and low-redundancy reconstruction technology, which reduce the overall radiation dose by up to 75%, break through the cost barriers of existing CBCT imaging technologies, achieve an industry-leading imaging resolution of 28 lp/cm (compared to the national standard of 10 lp/cm), and shorten the reconstruction time for a full-voxel large-field-of-view CBCT scan from over 60 seconds for current mainstream products to just 2.6 seconds. With its advantages of low cost, high precision, low dose, and rapid reconstruction, YOFO’s technological expertise directly addresses the key pain points in the dental CT market.

According to the “2020 White Paper on Oral Healthcare” released by VCBeat, China’s total population grew from 1.34 billion in 2010 to 1.39 billion in 2017, and with this expanding population base, the number of people requiring oral healthcare services increased to 694 million.

Overall, approximately 50% of Chinese residents suffer from various oral diseases, with demand remaining consistently high. However, due to varying degrees of severity, most patients do not attach sufficient importance to their conditions. A significant portion of the population still does not seek diagnosis or treatment for oral diseases due to various reasons, indicating substantial growth potential in the oral healthcare consumer market.

Both the expansion into new markets and product iteration present significant market opportunities for YOFO Medical. This advantage stems from YOFO Medical’s flexible and adaptable core imaging algorithm design technology, which enables the customization of imaging algorithms for different types of CBCT systems. Consequently, YOFO Medical can leverage its algorithmic framework to meet the requirements of diverse medical devices, thereby extending its reach into multiple CBCT domains, including dedicated breast CBCT, radiotherapy-guided CBCT, and mobile CBCT.

As an investor in this round, Mr. Zhou Zhenghua, Vice President of Huaying Investment, expressed strong confidence in the future of YOFO. He told VCBeat, “Our investment in YOFO is driven by two main factors. First, Dr. Zhu Lei’s team is exceptionally ‘hardcore,’ possessing robust capabilities and extensive accumulation in key technologies for CBCT R&D, along with a well-structured team and strong execution ability. Second, from a market perspective, CBCT aligns with the trend toward miniaturization and specialization in CT technology, offering promising prospects.”

Huaying Investment, established in April 2016, is a private equity fund manager registered with the Asset Management Association of China (AMAC). It currently operates and manages two funds, with total assets under management nearing RMB 700 million. Adhering to the philosophy of “thinking like entrepreneurs,” Huaying Investment primarily engages in venture capital services. Its management team boasts extensive industry and venture investment experience in smart hardware, AI technology, internet products, and healthcare. Committed to serving innovative enterprises in the broader Internet of Things (IoT) sector, Huaying Investment had completed investments in nearly 30 early-stage and growth-stage projects across its two funds by the second quarter of 2020.

Huami Technology, founded in 2013, is a cloud-based health service provider with globally leading smart wearable technology. Huami Technology is also the first Chinese smart hardware innovation company to list on the U.S. capital market, going public on the New York Stock Exchange (NYSE) in February 2018 (stock ticker: HMI). Guided by its mission, “Technology Connects Health,” Huami Technology implements a “Chip-Device-Cloud” strategy, laying out initiatives in chips, smart wearable devices, and health cloud services to build a global health ecosystem and become the most trusted partner for users. Leveraging powerful artificial intelligence algorithms and big data analytics capabilities, Huami Technology provides users with 24/7 health monitoring services and creates smarter, more convenient lifestyles by integrating smart wearable technology into the global Internet of Things.

Anhui Guoyuan Fund Management Co., Ltd. has a registered capital of RMB 100 million and serves as a key fund management platform under Guoyuan Capital, a subsidiary of Anhui Guoyuan Financial Holding Group. It is entrusted with the management of the Anhui Guoyuan Seed Investment Fund. The Anhui Guoyuan Seed Investment Fund, with a registered capital of RMB 1 billion, adopts an investment model of “base + fund,” focusing on nurturing and supporting high-tech enterprises in their seed and start-up stages. Leveraging the guiding role of state-owned capital, the fund provides comprehensive support for the standardized operations of small and micro sci-tech innovative enterprises through professional and market-oriented operations, thereby fostering the innovative growth of enterprises within Anhui Province and facilitating their advancement to higher-level capital markets.