BoRuiKang Files for IPO Amid $570M Fundraising Plan Despite Zero Revenue from Flagship Product and Unverified Long-Term Safety

Backed by Tsinghua University’s technical endorsement and holding the qualification for China’s first approved invasive brain-computer interface medical device, this deep-tech company has garnered fervent interest from the capital market, with its post-money valuation in the D+ financing round climbing to RMB 3.5–4 billion.

However, stripping away the glamorous facade of the “track” concept, a comparison between the draft prospectus and the company’s actual operational data reveals a fatal developmental paradox at Neuracle: despite holding significant technical qualifications, its core profit-generating products have generated zero revenue; despite commanding an ultra-high market valuation, the company has sustained substantial losses for years. The interplay of multiple operational shortcomings, governance risks, and industry uncertainties means that this capital-fueled frenzy in the sector cannot fundamentally conceal the company’s precarious financial footing.

I. Lack of Financial Self-Sustainability, ContinuedLossCompounded Fundraising Mismatch

Persistent large-scale losses represent Neuracle’s most critical operational weakness; the company has relied entirely on equity financing to sustain its operations, lacking any independent, sustainable capacity for self-generated cash flow.

According to the precise disclosures in the prospectus, the company’s operating revenues from 2023 to 2025 were RMB 75.2124 million, RMB 65.9747 million, and RMB 108 million, respectively, while its net profit attributable to shareholders of the parent company was -RMB 48.7575 million, -RMB 49.5338 million, and -RMB 230 million, respectively, resulting in a cumulative loss of RMB 328 million over the three-year period. The scale of losses surged dramatically in 2025, far exceeding the relatively stable loss levels of the preceding two years, thereby intensifying financial pressure significantly.

An analysis of the loss structure reveals that the company’s core business operations have remained relatively stable. The substantial book loss recorded in 2025 stemmed from non-operating factors, meaning the financial statement data does not accurately reflect the quality of the main business. In 2025, the company’s net profit excluding non-recurring items amounted to a loss of only RMB 47.3131 million, basically on par with the scale of core business losses in the previous two years, indicating no deterioration in the operational trend of the core business. The significant widening of the net profit attributable to shareholders of the parent company was primarily due to the accrual of RMB 183 million in share-based payment expenses for equity incentives granted to the actual controller and the core management team. As this expense represents a purely bookkeeping gain or loss with no actual cash outflow, it artificially inflated the annual loss figure and could easily mislead the market’s assessment of the company’s core operational capabilities.

Sustained high R&D investment is the structural core driver of the company’s long-term losses, with no viable path to loss reduction or profitability in the foreseeable future. As a frontier medical device technology enterprise, Neuracle has maintained consistently high R&D expenditures. From 2023 to 2025, its R&D expenses amounted to RMB 63.8845 million, RMB 57.9605 million, and RMB 65.1105 million, respectively, with the R&D expense ratio consistently exceeding 60%, reaching 87.86% in 2024—far above the domestic medical device industry average. The complete development cycle for innovative brain-computer interface (BCI) devices, from R&D and clinical trials to regulatory approval and commercialization, spans 5 to 10 years. Most of the company’s pipeline products remain in early-stage R&D and clinical phases, necessitating continued substantial capital investment. Consequently, the company lacks the fundamental conditions for near-term loss reduction or profitability.

The scale of capital raised in this IPO is severely disproportionate to the company’s revenue size, casting significant doubt on the necessity and rationality of the fundraising. In 2025, the company’s annual operating revenue was only RMB 108 million, while the proposed total amount to be raised reached RMB 2.5 billion, making the fundraising scale 23 times its annual revenue. Regarding the use of proceeds, 22% is allocated to supplement working capital. However, as of the end of 2025, the company’s monetary funds and structured deposits totaled RMB 670 million, with an asset-liability ratio of merely 14.14%. Given its ample cash flow and minimal debt repayment pressure, existing funds are fully sufficient to cover daily operations and short-term turnover. Consequently, the large-scale supplementation of working capital presents a clear risk of excessive financing.

The allocation of the remaining funds raised also carries realistic risks of resource misallocation and idle production capacity, making it difficult to close the commercialization loop. Of the total funds raised, 61.6% (amounting to RMB 1.54 billion) is directed toward brain-computer interface (BCI) research and development projects. Given the company’s limited revenue scale, weak commercial implementation, and long payback periods for its product pipeline, the output efficiency of such substantial R&D investment cannot be guaranteed, resulting in extremely high risks of sunk costs. Additionally, 16.4% (totaling RMB 410 million) is allocated to the industrialization of invasive products, with a planned annual production capacity of 500 units. However, this core product has generated zero revenue to date and lacks validation of genuine market demand. Blind capacity expansion will directly lead to idle production capacity, while the depreciation of newly added fixed assets will further exacerbate the company’s losses.

The company’s revenue structure is highly concentrated, its cash flow resilience is weak, and its overall risk resistance is insufficient. During the reporting period, 72%–83% of the company’s revenue was derived from non-invasive EEG acquisition systems, indicating a heavy reliance on a single business segment. Competition in this sector has become intensely fierce: imported brands dominate the high-end market of Grade A tertiary hospitals and core scientific research institutions, while domestic small and medium-sized manufacturers capture lower-tier markets through low-price strategies. The ongoing price wars continue to compress product gross margins. In terms of cash flow, the company’s operating cash flows were consistently negative in 2023 and 2024, turning positive only briefly in 2025, reflecting weak internal cash-generation capabilities. If the progress of fundraising through the IPO falls short of expectations, the company will face an immediate operational crisis characterized by tight capital chains and stalled research and development.

II. Difficulties in Implementing Core Technologies, Zero Revenue from Star Products

Neuracle’s post-money valuation of RMB 3.5–4 billion is primarily underpinned by its NEO-ONE SCI invasive brain-computer interface (BCI) product, which received regulatory approval in March 2026. As the world’s first approved Class III medical device for invasive BCI, this product serves as the company’s sole core pillar supporting its valuation.

However, verification against the public information in the prospectus reveals that this flagship product, which underpins the company’s high valuation, had not generated any operating revenue as of the date the prospectus was signed, indicating a complete disconnect between technological breakthroughs and commercial monetization. All of the company’s revenue derives from non-invasive devices characterized by low technical barriers and intense competition. The market’s rationale for assigning high growth prospects and a high valuation is entirely unsupported by actual commercial performance.

The commercialization of invasive products faces multiple hard barriers, and there are currently no realistic conditions for large-scale promotion. NEO-ONE SCI is a Class III implantable medical device, the highest regulatory category. Its implantation, intraoperative debugging, and postoperative rehabilitation require collaborative efforts from multidisciplinary teams comprising neurosurgery, rehabilitation medicine, and biomedical engineering. Currently, only a few top-tier tertiary hospitals in China, such as Huashan Hospital and Xuanwu Hospital, possess the mature operational capabilities required; municipal-level and primary healthcare institutions completely lack the capacity for implementation. Furthermore, the industry has not yet established standardized clinical protocols or physician training systems, which restricts clinical promotion and makes large-scale adoption unfeasible in the short term.

The absence of medical insurance coverage is the core bottleneck to product adoption, directly capping market growth potential. Currently, NEO-ONE SCI is only listed in the Shanghai Medical Consumables Online Procurement Catalog and has completed hospital access registration, but it is not included in any medical insurance reimbursement schemes, requiring patients to bear the full cost out-of-pocket. Given the device’s high price point and its target population—patients with paralysis due to cervical spinal cord injury, who already face substantial long-term rehabilitation expenses and have limited financial capacity—the full out-of-pocket payment model inherently restricts market penetration, preventing the generation of scalable and sustainable sales revenue.

The approved indications for the product are narrow, resulting in limited existing market space and questionable long-term growth logic. According to the product registration certificate and prospectus information, NEO-ONE SCI is only suitable for patients with stable quadriplegia due to spinal cord injuries at the C2–C6 cervical segments. It imposes strict restrictions on the injury segment, physical condition, and age, making the target population highly niche. New indications planned by the company, such as refractory epilepsy, stroke, and severe depression, are all in early stages of research and development and clinical trials. Clinical trials for innovative medical devices are challenging, time-consuming, and subject to stringent approval standards. The progress and outcomes of the pipeline remain uncertain, leaving the company's long-term growth potential effectively constrained.

There is insufficient data to validate the long-term safety and stability of the product, and clinical risks have not been fully elucidated. The prospectus discloses that the product’s clinical trials included only 32 subjects across multiple centers, with a cumulative safe implantation duration of nearly 5,000 days and an average implantation duration of less than 170 days per subject, indicating limited short-term follow-up data. From the perspective of industry technical characteristics, invasive implanted devices are prone to delayed complications after long-term implantation in the human body, such as electrode signal attenuation, tissue encapsulation by scarring, device aging, and chronic inflammation. These risks require long-term clinical observation for verification. The existing short-term trial data cannot substantiate the long-term safety and stability of the product, and its large-scale application poses potential medical risks.

III. Weak First-Mover Advantage, Industry Competitive Barriers Are Difficult to Sustain

Capital continues to pour into the brain-computer interface (BCI) sector, with a significant surge in market entrants intensifying competition to a fever pitch and shattering Neuracle’s previously exclusive leading position. Verification against publicly available competitor information reveals that the company’s advantage is merely a temporal head start in securing product approval; this has not yet translated into robust barriers in terms of technology, distribution channels, brand equity, or cost efficiency. Consequently, its industry leadership remains precarious as the window of opportunity in this sector continues to narrow. The market label of “the first BCI stock” is primarily conceptual in nature and lacks support from any substantive monopoly position.

Leading overseas companies possess profound technological accumulation, creating a significant generational technology gap for domestic enterprises. Neuralink, under Elon Musk, has long been deeply engaged in the brain-computer interface (BCI) field, demonstrating significant advantages in core dimensions such as electrode array density, automated implantation, wireless transmission, long-term in vivo stability, and foundational patent layout. Its device maturity, iteration speed, and duration of safe use all substantially lead those of domestic products. Levering global capital and clinical resources to continuously iterate their technologies, overseas companies have long constrained the expansion space for domestic enterprises in the high-end market.

The company’s product portfolio faces squeeze from two-sided competition, with revenue and gross margin under continuous pressure. In its core revenue-generating non-invasive business segment, imported brands dominate the high-end research and core market of Grade A tertiary hospitals, while domestic small and medium-sized manufacturers capture the lower-tier markets with low-price strategies; intense market competition continues to compress profit margins. In the invasive sector, where the company has made strategic investments, several domestic competitors have entered clinical trials and are expected to enter the market in a concentrated manner in the future, intensifying competition. As a result, the company’s existing first-mover advantage will gradually erode, posing ongoing challenges to its market share and profitability.

From an overall industry landscape perspective, Neuracle has not established irreplaceable core competitive barriers. The company merely retains a first-mover advantage in product approval, lacking proprietary core technologies, a mature nationwide clinical distribution network, scaled case data, and brand advantages. Amidst intensifying domestic competition, rapid catch-up by competitors, and the overwhelming superiority of overseas technologies, the company’s long-term leading position lacks substantive support. The high sector premiums and elevated growth expectations assigned by the capital market are severely disconnected from the company’s fundamental realities.

IV. Prominent Risks in the R&D System, with Proliferating Hidden Dangers in Intellectual Property and Supply Chain

Innovative medical devices inherently possess characteristics of long development cycles and high uncertainty. Neuracle’s multi-pipeline strategy further amplifies R&D risks. The company’s invasive products under development for refractory epilepsy, stroke, and lower-limb motor reconstruction are all in early-stage R&D or clinical phases. Innovative devices commonly face challenges such as difficulties in patient enrollment, prolonged trial durations, and stringent regulatory approvals. There is no guaranteed outcome for pipeline progress, trial results, or regulatory clearance, posing a risk that substantial R&D investments may become sunk costs without translating into revenue.

Industry standards and regulatory frameworks remain underdeveloped, exposing corporate R&D to trial-and-error compliance risks. Currently, there are no unified technical standards, data specifications, or clinical evaluation systems for the global brain-computer interface (BCI) industry, while domestic regulatory details in China continue to be refined. In the absence of fixed benchmarks for early-stage exploratory R&D, companies face a high likelihood of subsequent issues such as misalignment between R&D outcomes and new regulations, shifts in the acceptance of clinical data, and adjustments to approval criteria. Consequently, the margin for error in R&D is extremely narrow, and compliance uncertainty is pronounced.

Shortage of High-End Industry Talent and Pressure on Core R&D Team StabilityBrain-computer interface (BCI) is a highly advanced, multidisciplinary field characterized by intense competition for talent and the normalization of high-salary poaching. Although R&D personnel account for over 40% of the company’s workforce, serving as the core support for technological iteration, key positions in core algorithms, chip development, and clinical engineering face persistent risks of industry-wide turnover. The loss of core talent would directly impede pipeline development and technological upgrades, thereby compromising the stable operation of the R&D system.

The boundaries of industry patents are blurred, with significant overlap and intersection, leading to objectively existing intellectual property risks. Leading overseas companies such as Neuralink and Blackrock Neurotech have completed intensive deployment of foundational patents, establishing robust technical barriers. Domestic enterprises are largely in the phase of follow-up development and breakthroughs. During product iteration and commercialization, Neuracle faces potential risks including patent infringement, ownership disputes, and the invalidation of core patents. Any such disputes would directly impact product registration, market access, and normal business operations.

Core components are heavily reliant on imports, resulting in inherent vulnerabilities in supply chain stability. Key devices required for the company’s invasive products—such as high-density microelectrode arrays, ultra-low-noise neural signal chips, and high-precision wireless transmission modules—have extremely low rates of domestic substitution and are primarily sourced from overseas suppliers. Fluctuations in geopolitical dynamics, international trade policies, and delivery lead times from foreign manufacturers can easily trigger issues such as price hikes, delays, and supply disruptions, directly constraining the company’s capacity ramp-up, product iteration, and large-scale commercial deployment.

V. Dispersed equity structure and weak governance, insufficient internal control stability

Neuracle’s equity structure is fragmented, with a relatively low shareholding ratio held by the actual controllers, resulting in inherent weaknesses in corporate governance and strategic decision-making. According to the prospectus, the two joint actual controllers collectively held 33.56% of the shares prior to the issuance, which will be diluted to approximately 17% after the IPO, leaving no entity with absolute controlling interest. In the hard-tech sector, characterized by rapid technological iteration and short windows of market opportunity, low equity concentration can easily lead to strategic instability and delayed decision-making, making it difficult for the company to keep pace with the industry’s high-speed competitive rhythm.

The company has undergone multiple rounds of financing, with a high concentration of institutional shareholders. Post-listing, the pressure for share reduction is clear and persistent. Since its establishment, the company has completed eight rounds of financing, introducing more than ten top-tier PE/VC firms including Sequoia China, Baidu Venture Capital, Sinowood Capital, and Fortune Capital. External institutional shareholders hold dispersed stakes, prioritize financial returns, and have a strong intention to exit. This IPO serves as the primary exit channel for earlier private equity investors. After the lock-up period expires, concentrated share reductions by these institutions will exert long-term downward pressure on the company’s stock price, leaving secondary market investors to directly bear the exit risks.

A fragmented equity structure triggers internal governance friction, reducing the company’s initiative in market competition. The brain-computer interface (BCI) industry is characterized by rapid market changes and swift technological iterations, demanding extremely high decision-making efficiency from enterprises. With no controlling shareholder holding an absolute majority, institutional shareholders have significantly divergent interests. There is an inherent conflict between short-term capital return expectations and the company’s long-term R&D strategy, which can easily lead to delays in implementing major strategic decisions, posing the risk of missing critical windows for industry development.

Concentrated customer structure and extended collection cycles further amplify operational volatility risks. The company’s core customers are university research institutions and public Grade A tertiary hospitals, whose procurement rhythms are strictly constrained by fiscal budgets, research cycles, and annual appropriations, resulting in significant seasonal fluctuations in revenue. During the reporting period, the ratio of accounts receivable to revenue remained persistently high at 22%–37%, indicating low capital recovery efficiency. Structural weaknesses characterized by customer concentration and delayed payments, compounded by a fragmented governance system, have further weakened the enterprise’s risk resilience, sustaining ongoing pressure on internal control management.

From the perspective of the STAR Market’s sector characteristics, unprofitable companies with high R&D intensity covered by the fifth listing standard generally exhibit significant stock price volatility and low tolerance for valuation errors. Neuracle, compounded by multiple shortcomings—including persistent losses, lack of commercialization, intensifying competition, fragmented corporate governance, and elevated valuation—demonstrates weak certainty for secondary market investment and a high risk coefficient, resulting in an overall unfavorable risk-return profile. (Produced by Zhitai)

       Original Title: Imbalance Between RMB 4 Billion Fundraising Scale and Revenue Volume; Neuracle’s Product Safety Remains Unverified