Medical Device Tech Company, 908 Devices, Raises $100 Million Through IPO

By Bruce Harpham Friday, January 1, 2021

908 Devices, which makes biological and chemical testing equipment, is set to raise $100 million at its initial public offering (IPO). The company's customers include hazmat teams, researchers, and law enforcement agencies. Before becoming public, the Boston company had raised over $66 million from investors.

A scientist working in a laboratory.

908 Devices: Key Financial Numbers

Founded in 2012, 908 Devices has come a long way in the past decade.

  • Revenue Doubles. In the first three quarters of 2020, the company earned $21.1 million in revenue (up from $9.6 million in 2019).

  • Profit In Sight. The company has not achieved profitability yet, but it is getting closer. The startup reported $2.6 million net losses in the first nine months of 2020 (up from $12.9 million in the same period of 2019).

  • Research and Development (R&D) Spending Slows. Surprisingly, the device has reduced its R&D spending. In 2018, the company spent $9.5 million. In contrast, the company has only spent $5.9 million in the first nine months of 2020. The startup's slow spending on R&D may suggest a shifting focus to sales vs. developing new products.

  • More Cash. Some companies have struggled financially during the pandemic. Judging based on their sales and cash, 908 Devices doesn't have that challenge. At the end of 2019, the company had $17.9 million in cash. By September 2020, the startup grew its cash reserve to $19.7 million.

The Funders Behind 908 Devices

As a hardware company, 908 Devices has significantly higher expenses than a pure software company. Furthermore, the device company has to meet the expectations of labs, law enforcement, and other customers with high standards. In its first decade of operation, 908 Devices mainly relied on its early investors for growth.

908 Devices has raised $66 million in investment over six funding rounds. Significant investors in the company include Northpond Ventures, Tao Capital Partners, and the University of Tokyo Edge Capital. Based in Maryland, Northpond Ventures mainly invests in biotechnology companies such as DNAnexus (cloud computing for genomic medicine), IsoPlexis (protein analysis software), and the UK's Ori Biotech (manufacturing for life sciences). San Francisco-based Tao Capital Partners has a broader strategy with investments in healthcare, transportation, and food companies. Tao's successful exits include Enlightened (internet of things platform for commercial real estate) and Aquion Energy (sodium-ion batteries).

How COVID-19 Impacted 908 Devices

COVID-19 has posed some challenges to 908 Devices’ growth plans. In an SEC filing, the company notes that "laboratory shutdowns and reduced capital spend[ing] have negatively impacted our ZipChip Interface and consumables sales." Also, the company had taken some emergency measures to conserve cash, such as laying off staff early in the year. Fortunately, 908 Devices has been able to bring back its furloughed employees in July 2020.

The company's sales and marketing strategy have also suffered. The 908 Devices had relied on in-person sales activities and events like conferences in the past. Most of these events have been canceled in 2020, making it hard for the company to connect with new customers. The startup has a sales force of sixteen commissioned sales representatives.

The Revenue the Company Earns From Its Products

The Boston startup earns the majority of its revenue from a single product — the MX908 — which accounted for 87% of the company's revenue in the first nine months of 2020. In contrast, the ZipChip Interface contributed 6.5% of revenue in 2020. The remaining product revenue came from the Rebel product.

The MX908 is a handheld device that detects certain substances such as drugs (i.e., fentanyl, opioids, and amphetamines), hazardous materials, and explosives. The device is popular with law enforcement agencies because it can detect over two thousand fentanyl variants. There were over 31,000 overdose deaths related to synthetic opioids in the United States in 2018, according to the CDC.

The ZipChip Interface helps with testing chemical and biological samples. Unlike the MX908, the ZipChip is generally used in a lab setting to analyze molecules and proteins. It is used in conjunction with a mass spectrometer.

The Rebel device helps researchers speed up data gathering on bacteria and other lab projects. The device can analyze amino acids, vitamins, and other substances in less than ten minutes.

About the Author

Headshot for author Bruce Harpham

Bruce Harpham is an author and marketing consultant based in Canada. His first book "Project Managers At Work" shared real-world success lessons from NASA, Google, and other organizations. His articles have been published in, InfoWorld, Canadian Business, and other organizations. Visit for articles, interviews with tech leaders, and updates on future books.

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