Pomegra
Scarlet, a London notified body for software and AI medical devices, raised $50M in a Series B led by Headline to expand its certification work in 2026.
Key Takeaways
- Scarlet raised a $50M Series B on October 12, 2026, led by Headline; valuation was not disclosed.
- Notion Capital joined as a new investor; Kindred, Creandum, Atomico and Entrepreneurs First returned.
- Total disclosed funding now stands near $73.5M after a £6M seed (2022) and $17.5M Series A (2024).
Lead
Scarlet, the London-based certification body for software and AI medical devices, announced a $50M Series B on October 12, 2026. Headline led the round. Notion Capital joined as a new backer, and existing investors Kindred Capital, Creandum, Atomico and Entrepreneurs First took part again.
The company did not disclose a valuation. It says the money will go toward hiring technical and clinical reviewers, broadening its certification services, and building a presence in the US and Asia-Pacific.
What Does Scarlet Actually Do?
Scarlet issues the regulatory certificates that software and AI medical devices need before they can be sold. It is an EU notified body (NB 3022) under the Medical Device Regulation, a UK Approved Body (AB 8536) designated by the MHRA, and an FDA-recognised third-party review organisation.
Customers upload technical documentation to a software platform, and qualified human reviewers make the regulatory judgements. Scarlet bundles initial assessment, product changes, post-market surveillance and annual audits into one continuing relationship. It issued its first EU MDR certificate in June 2024.
Founders James Dewar and Jamie Cox started the company in 2021 after building medical AI at Babylon Health. Scarlet is the only specialist among roughly 52 EU notified bodies that works exclusively on software and AI. Named customers include Flo Health, Skin Analytics, Heidi, Tandem Health, DeepHealth, Flok Health and NHS England.
Why Does a Notified Body Need Venture Money?
Because capacity is the bottleneck, and reviewers are expensive. Notified bodies are capital-light in theory, since they charge fees for assessments. In practice each certificate requires people who understand both clinical risk and machine learning, and those people are scarce.
The Series B roughly triples the capital Scarlet had raised by mid-2024, when the $17.5M Series A closed. That is a sizeable step up for a company that has been issuing certificates for only about two years. The round implies investors see the constraint as throughput rather than demand, and that the company's early timelines held up with paying customers.
Scarlet's own claim, repeated in its announcement, is that customers have cut a year or more from certification timelines for new AI-enabled devices. It also says product-update cycles have shortened from months to weeks. Those figures come from the company and have not been independently audited.
How Does This Change Medical AI Regulation?
It turns certification from a one-off project into a recurring service. AI products change frequently, and each significant model update can trigger a fresh regulatory review. A notified body that handles updates in weeks rather than months matters more to a startup shipping monthly than a faster first approval does.
The structural tension remains. A notified body is paid by the companies it certifies, and a venture-backed one has growth targets. Regulators in the EU and UK manage that conflict through designation and oversight, and Scarlet's expansion will be measured against those audits as much as against its speed claims. Headline partner Xiao McLaughlin framed the thesis as helping "regulation work with and for, not against, innovation."
What Comes Next for Scarlet?
Expansion into the US and Asia-Pacific is the stated priority, and it carries different rules. In the US, Scarlet's FDA-recognised status lets it conduct third-party reviews for certain device types, which falls short of replacing the agency's own pathways. In Asia-Pacific, each market runs its own approval regime, and EU or UK certificates do not transfer automatically.
Growth in the AI medical device market is the tailwind. One forecast puts the sector at $12.46B in 2025, up from $10.08B in 2024, with some projections reaching $124.6B by 2033. Such long-range figures vary widely between forecasters and deserve caution. The nearer test is whether Scarlet can add reviewers without lengthening its queue.
Outlook
Scarlet enters its next phase with about $73.5M in disclosed funding, three regulatory designations and a customer list that includes a national health service. The open questions are hiring pace, the ability to replicate its timelines outside Europe, and whether regulators remain comfortable with a fast-growing commercial certifier. The valuation stays private, so the round's price signal is limited to the size of the cheque.
