Brain+ closes 2022 with the first municipal sale
of its new dementia product and begins the monetization journey
- The sale covers the use of the ‘basic package’ of the CST-Therapist Companion in one training facility for one year, in the municipality of Herning, at an introductory price of 50.000 DKK.
- This sale happens already within 2 months of market introduction in what is normally a municipal sales cycle of 6-18 months. A number of customer dialogues are ongoing.
- The total market potential in Denmark is valued at 200 million DKK, in the range of ~250.000-10 million DKK per municipality. These estimates are based on the full future portfolio of Brain+ digital dementia products and services.
Another milestone has been met by Brain+ as it closes the year with the first sale of its new dementia product, the CST-Therapist Companion to the municipality of Herning for their Training & Activity East facility. The CST-Therapist Companion product became ready for market introduction in November 2022, several years ahead of plan. The Company then expressed the ambition to start closing sales as soon as possible to the municipal B2B customer segment, which typically has 6-18 months sales cycles, and has now within 2 months delivered the first result before year-end.
Closing the year with a sale to the first customer for our new product is much more than a single sale, it marks the shift from being a pre-revenue company to being a revenue-generating company. For me, this is a long-awaited start to monetizing all the work we have done until now. This is the first very small step in what I expect to be a tremendous growth journey, which takes advantage of the unique position within digital therapeutics for dementia that we have worked to build. I don’t expect it to be easy, but I have no doubt that we have all the right cards on our hand to make this happen.Kim Baden-Kristensen, CEO & Co-founder Brain+
Understanding the municipal sale and potential
The sale was of the ‘basic package’ of the CST-Therapist Companion, which includes therapist access for one training facility to the ‘basic’ version and license to use the CST-Therapist Companion, 1x update agreement, 1x online education via Teams, and a ‘basic’ Service Level Agreement. Customers have the option to choose higher-tier packages, including services. Herning is the 13th largest municipality in Denmark with ~90.000 citizens, and there is thus significant potential to expand the agreement to cover more facilities and therapists in the municipality beyond the first facility covered by the sale. When the next product, CST-Home Care, is introduced to the market, contracts can be expanded to include this product also, which will allow the municipality to offer CST much more extensively than they can do today. In short, the first sale opens the door to larger and longer-term agreements that create value for both people with dementia, the municipalities, and Brain+.
Ongoing dialogues with numerous municipalities
The introduction of the CST-Therapist Companion in November 2022 has been met with great interest by Danish municipalities, who are the primary target customers for this product. There are currently ongoing customer dialogues with numerous Danish municipalities. The initial sales outreach focuses on the 30+ municipalities that are already offering regular CST to their citizens and who can immediately benefit from the digital CST-Therapist Companion. Some municipalities are aiming to fast-track their buying process. Adoption of CST in Denmark is happening rapidly and there is a 6-month waiting time to train new CST therapists, meaning that the market will be steadily growing as new CST therapists are continuously educated. The product introduction has also been received with positive interest from strategic pharma partners active in the Alzheimer’s field.