NeuroSky is one of 53 companies chosen by VentureBeat to launch at the DEMO Spring 2011 event taking place this week in Palm Desert, Calif. After our selection, the companies pay a fee to present. Our coverage of them remains objective.

NeuroSky has wowed kids with its brainwave monitoring technology that has been built into cool electronic toys. But today, the company is moving into the education market with the launch of its intelligent educational learning product, dubbed Brian Cubed.

Showing off the technology at the DEMO Spring 2011 conference, NeuroSky is launching the $99 brainwave-sensing headsets with the MindWave education bundle in the U.S. and Europe through a variety of partners. The Brain Cubed system comes with 10 learning games that use the brainwave feedback in some fashion.

NeuroSky makes sensors that can detect your brainwave activity, measuring the electroencephalography ((EEG) activity that shows whether you’re sleepy, alert, concentrating, or nervous. It then takes that feedback for use by an application, ranging from toys such as Mattel’s MindFlex game to the new learning product. The mind-blowing result is that you can control your brainwaves and thereby control a product, Jedi style.

In previous products, NeuroSky, based in San Jose, Calif., licensed its Bio-Sensor chips for use in other products. But the Brain Cubed product is the company’s first standalone consumer product. It  incorporates learning from research with 150 universities and government agencies, which provide expertise on what the brain signals mean. Brain Cubed turns computers into private tutors. It understands the student’s mindset and interacts in real time, helping the student concentrate when needed. It also helps people deal with high-stress situations, like being on stage giving a talk, said Stanley Yang, chief executive of NeuroSky.

With the NeuroSky MindWave education bundle, teachers, tutors and parents can objectively see what a child’s attention level is during math lessons, Yang said. In the coming weeks, NeuroSky will add a variety of apps on top of the education platform, from calculus to history lessons. The product will launch today in a 24-hour exclusive at and then it will be available on and e-commerce and retail stores. The ten applications included in the bundle focus on math, pattern recognition and memory. A few also focus on entertainment applications that encourage kids to pay attention or relax.

One application, SpeedMath, delivers timed arithmetic tests that emphasize early grade school addition, subtraction, division and multiplication. It shows correct and incorrect answers and reports the time spent answering each question. While the child is wearing the headset, it also reports the EEG brainwave data that measures attention. The attention level will be in a tight range if the student is challenged appropriately. The changes in brainwaves can signal frustration or boredom in near real-time. The system can actually show there are mental benefits to playing games.

Yang says education is just one of many applications.  The system also works in helping athletes find their zone via a product called BrainAthlete. With MyndPlay, the system can be used to change the outcome of a video or movie using only the viewer’s thoughts. Others include helping children with attention deficit disorder or adults with Alzheimer’s disease.

All that may sound like NeuroSky has it made, but it’s been a long journey for Yang and co-founder KooHyoung Lee. The company was founded in 2004 and it has 50 employees.  NeuroSky is on its second-generation chip and more improvements and cost reductions are on the way. NeuroSky has raised $18.6 million from W.R. Hambrecht and Tiacom Capital. Yang said the company is not raising money and is profitable.

But it’s not all about making money. Yang said a mother emailed the company a year ago about her 21-year-old son with cerebral palsy. She bought him a NeuroSky headset and was able to play games that helped him control his attention level. He could then answer yes or no to his mother’s questions by controlling his brainwaves — for the first time. Asked if he loved his mother, the son said yes, using NeuroSky. That’s a pretty compelling platform, and Yang says the company and its many partners are just getting started with applications for it.

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