Scarlet Raises $50M Funding to Certify AI Medical Devices Without the 18-Month Wait

Scarlet, the London-based certification body for AI and software medical devices, has raised $50 million in Series B funding led by Headline, with participation from new investor Notion Capital and existing backers Atomico, Creandum, Kindred Capital, and Entrepreneurs First. Nancy Xiao McLaughlin, Partner at Headline, joins Scarlet’s board.

The round brings Scarlet’s total disclosed funding to approximately $73.5 million, following a £6 million seed in August 2022 and a $17.5 million Series A in June 2024. The company did not disclose its valuation.

The funding comes as Scarlet prepares to expand into the United States and Asia-Pacific, grow its roster of expert AI reviewers and engineers, and broaden its certification offerings. The company is the only Notified Body under EU MDR specialised exclusively in software and AI medical devices, holding designations from the EU, the UK’s MHRA, and the US FDA as a Third Party Review Organisation.

Scarlet Funding Overview By CREDX Media

Startup Name	Scarlet
Founders	James Dewar (CEO), Jamie Cox (CTO)
Founded	2021
HQ	London, UK
Round	Series B Funding
Amount Raised	$50M
Valuation	Not disclosed
Category	MedTech Certification, AI Medical Devices, Regulatory Infrastructure
Lead Investor	Headline
New Investor	Notion Capital
Returning Investors	Atomico, Creandum, Kindred Capital, Entrepreneurs First
Total Funding Raised	~$73.5M
Key Designations	EU MDR Notified Body, UK MHRA Approved Body, US FDA Third Party Review Organisation
Key Customers	Flo Health, DeepHealth, NHS England, Skin Analytics, Heidi Health, Tandem Health, Flok Health

💡 Use of Funds

• US and Asia-Pacific Expansion: Establishing certification operations in new regulatory jurisdictions.
• Expert Reviewer Growth: Hiring additional AI reviewers and engineers to increase certification capacity.
• Certification Offerings: Broadening services beyond current scope.

Startup Overview: Scarlet

What Scarlet Is Building in Simple Words

Scarlet has built an AI-native certification body designed specifically for the pace of software and AI development. Traditional certification bodies were built for hardware devices that change infrequently. Scarlet was built from the ground up for products that iterate continuously .

• AI-Native Certification Platform: Customers upload technical documentation in any format to Scarlet’s digital workspace. Qualified reviewers assess submissions against relevant regulations and issue certification decisions .
• Subscription Model: Customers pay ongoing subscriptions covering surveillance, annual audits, and product changes—enabling frequent releases without re-certification delays .
• Evidence Trail: Every finding is documented, allowing regulators to inspect the reasoning behind any certification decision at any time .
• Proven Speed: One customer, Flok Health, achieved EU MDR certification in 14 weeks—versus the 12–18 months typical for conventional assessments .
• Iteration Support: Flok Health’s CEO stated: “We want to release upgrades to our medical device twice a month. We can with Scarlet. No one else can deliver that” .

Why Scarlet Matters

1. AI Medical Devices Are Outpacing Certification Capacity A company can train an AI diagnostic model in weeks, then wait 12 to 18 months for an expert assessment. Minor updates add another 6 to 8 months of delay . This gap slows healthcare innovation and delays patient access to life-saving technology.
2. Traditional Notified Bodies Weren’t Built for Software Among roughly 52 Notified Bodies designated under EU MDR, Scarlet is the only one that specialises in software and AI—and was truly built to enable AI’s iterative development .
3. Regulatory Designations Create a Deep Moat Scarlet spent its first three years working with regulators to obtain designation before issuing any certificates. It now holds certifications in the EU, UK, and US—the most rigorous jurisdictions . This regulatory power is not easily replicated.
4. Customer Traction Spans Startups to Giants Scarlet certifies devices for Flo Health (500M+ downloads), DeepHealth, NHS England, Skin Analytics, Heidi Health, and Tandem Health .

Startup Story: From Babylon Frustration to a New Kind of Notified Body

Scarlet didn’t start in a regulatory office. It started inside a company that couldn’t get its AI products certified fast enough.

James Dewar and Jamie Cox met at Babylon Health, where they built AI medical devices and experienced firsthand the bottlenecks of legacy certification. Dewar was a Senior Data Scientist; Cox was a Software Engineer who originally studied medicine before switching to code.

As they waited months, then years, for their tech to be reviewed, they recognised a fundamental mismatch: certification bodies were designed for hardware devices with infrequent changes, not software that updates continuously. They decided to build something better.

In 2021, they founded Scarlet in London. The company spent its first three years working with regulators to obtain designation before issuing any certificates—a deliberate, patient strategy that created a regulatory moat competitors cannot easily replicate.

By October 2026, Scarlet had grown into Europe’s only AI-specialised Notified Body, with customers spanning consumer health apps, hospital systems, and AI scribes. The $50 million Series B now funds its expansion into the US and Asia-Pacific .

James Dewar framed the mission: “For every day that safe and effective medical technology is not available, someone’s life takes a different course. Scarlet exists to solve this problem” .

Our Take on Scarlet

Scarlet is solving the least glamorous problem in healthcare AI—certification—and that’s precisely why it matters.

Every AI medical device must pass through a regulatory gate. When that gate is slow, innovation stalls and patients wait. Scarlet’s insight is that the gate itself can be rebuilt—not to lower standards, but to match the speed and iteration cycles of modern software .

The $50 million Series B is justified on multiple fronts: a rare regulatory moat (designations in EU, UK, and US), proven customer outcomes (14-week certification for Flok Health), and a business model (subscription surveillance) that aligns with how software companies actually operate . Headline’s leadership and Notion Capital’s participation signal conviction in Scarlet’s position as critical infrastructure for medtech .

The real risk isn’t technical—Scarlet has issued certificates and signed named customers. The risk is scaling human review capacity as the company expands across jurisdictions. Software can structure evidence, but certification still depends on qualified reviewers . Adding reviewers and engineers is central to the expansion plan.

For now, Scarlet has capital, regulatory power, and a clear thesis: certification built for the AI age, not the hardware age.

Founder Background: The Babylon Engineers Who Built a New Regulatory Path

James Dewar (CEO) was a Senior Data Scientist at Babylon Health, working extensively on software medical devices. He also spent time at Smarkets .

Jamie Cox (CTO) originally studied medicine before becoming a software engineer. He worked at Babylon Health as a Software Engineer .

Their experience building AI medical devices—and waiting for certification—shaped Scarlet’s founding thesis. They didn’t start with a regulatory theory; they started with a lived frustration that the system couldn’t keep up with the technology they were building .

The AI Certification Race Nobody Expected

Scarlet operates in a market with 52 Notified Bodies designated under EU MDR—but only one specialised in AI and software .

Traditional Notified Bodies including TÜV SÜD, BSI, and DEKRA have decades of experience certifying hardware devices but were not built for iterative software development .

Scarlet’s differentiation is threefold: AI-native platform that structures evidence automatically, subscription model that supports continuous releases, and regulatory designations across EU, UK, and US. No other body combines all three .

The competitive moat, if it materialises, is regulatory power plus customer workflow entrenchment. Every device certified on Scarlet makes the platform more valuable for future submissions, particularly as the company expands into new jurisdictions .

Founder Intelligence: What Founders Can Learn from Scarlet

• Lived frustration is a valid foundation: Dewar and Cox built Scarlet because they experienced the problem firsthand at Babylon Health. Their credibility came from having been customers, not theorists.
• Regulatory power is a moat worth building: Scarlet spent three years obtaining designations before issuing certificates. That patient investment created a barrier competitors cannot quickly cross.
• Align your pricing with your customers’ reality: Subscription surveillance matches how software companies operate—continuous releases, not one-time approvals. The model creates recurring revenue and customer lock-in.
• Speed is the product: Flok Health’s 14-week certification is the proof point. In regulated industries, speed without cutting corners is the ultimate value proposition.

Investor Intelligence: Why This Round Gets Premium Capital

Headline led the round. Nancy Xiao McLaughlin, Partner at Headline, framed the thesis: “Scarlet helps regulation work with and for, not against, innovation. James and Jamie experienced the legacy certification process firsthand and decided to become the AI-native market enabler” .

Notion Capital joined as a new investor. In a blog post explaining their conviction, they highlighted three theses: Scarlet is an AI-native service that delights customers; it moves certifications from human scale to AI scale; and its certification expertise is in AI—precisely what is driving healthcare innovation .

Atomico, Creandum, and Kindred Capital returned after backing earlier rounds, signalling continued conviction in Scarlet’s trajectory .

The Road Ahead for Scarlet

Expansion Targets

With $50 million in capital, Scarlet will:

• Establish certification operations in the United States and Asia-Pacific
• Hire additional expert AI reviewers and engineers
• Broaden certification offerings beyond current scope
• Scale review capacity while maintaining rigor

Competitive Response

Expect:

• Traditional Notified Bodies to deepen AI capabilities
• New AI-native certification bodies to emerge in other jurisdictions
• Large medtech companies to seek preferred partnerships
• Scarlet’s moat: regulatory designations + AI-native platform + subscription model

Conclusion

Scarlet’s $50 million Series B validates the thesis that certification itself can be rebuilt for the AI age. The company’s unique position as Europe’s only AI-specialised Notified Body, its proven speed (14-week certification for Flok Health), and its regulatory designations across EU, UK, and US position it as critical infrastructure for medtech innovation.

Market tailwinds favour Scarlet: AI medical devices outpacing certification capacity, traditional bodies built for hardware not software, and growing demand for faster patient access to life-saving technology. The company’s subscription model and regulatory moat create durable advantages as it expands into new jurisdictions.

For deep analysis of medtech funding, regulatory innovation, and companies reshaping healthcare infrastructure, explore CREDX Media for comprehensive coverage of startup funding trends, valuation intelligence, and founder playbooks.

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Frequently Asked Questions

1. What is Scarlet’s total funding and latest round size?
Scarlet has raised approximately $73.5 million total. Its $50 million Series B was led by Headline in October 2026, following a £6 million seed in 2022 and a $17.5 million Series A in 2024 .

2. How much did Scarlet raise in its Series B round and who led the investment?
Scarlet raised $50 million in Series B funding led by Headline, with participation from Notion Capital, Atomico, Creandum, Kindred Capital, and Entrepreneurs First .

3. What is the valuation of Scarlet?
Scarlet did not disclose its post-money valuation. The company has raised approximately $73.5 million in total disclosed funding .

4. Who are the major investors in Scarlet?
Major investors include Headline (Series B lead), Notion Capital, Atomico, Creandum, Kindred Capital, and Entrepreneurs First .

5. Who are Scarlet’s founders?
Scarlet was founded in 2021 by James Dewar (CEO) and Jamie Cox (CTO), both former Babylon Health engineers who built AI medical devices and experienced certification delays firsthand .

6. What is Scarlet’s business model?
Scarlet operates a subscription model covering ongoing surveillance, annual audits, and product changes—enabling customers to release frequent updates without re-certification delays .

7. What regulatory designations does Scarlet hold?
Scarlet is designated as an EU Notified Body under MDR, a UK Approved Body under MHRA, and a US FDA Third Party Review Organisation .

8. How does Scarlet differ from traditional Notified Bodies?
Among roughly 52 EU MDR Notified Bodies, Scarlet is the only one specialising exclusively in software and AI, with a platform built for iterative development rather than hardware certification .

9. What customers use Scarlet’s certification services?
Scarlet’s customers include Flo Health, DeepHealth, NHS England, Skin Analytics, Heidi Health, Tandem Health, and Flok Health .

10. What are Scarlet’s plans for the $50 million Series B capital?
Scarlet will expand into the United States and Asia-Pacific, grow its roster of expert AI reviewers and engineers, and broaden its certification offerings .

11. Who is the CEO of Scarlet?
James Dewar serves as CEO and co-founder of Scarlet. He was previously a Senior Data Scientist at Babylon Health, working on software medical devices .