Mary Lou Jepsen - who is a former engineering executive at Facebook, Oculus, Google[x] and Intel - founded Openwater in 2016 in the hope of making telepathy possible on the go with the use of a hat.
She said: "I figured out how to put basically the functionality of an M.R.I. machine - a multimillion-dollar M.R.I. machine - into a wearable in the form of a ski hat.
"If I threw [you] into an M.R.I. machine right now ... I can tell you what words you're about to say, what images are in your head. I can tell you what music you're thinking of. That's today, and I'm talking about just shrinking that down."
The beanie would work by measuring the flow of oxygen in a person's body, which is shown through infrared light, making the device cheaper than a traditional MRI scanner.
She shared: "Our bodies are translucent to that light. The light can get into your head ... Right now our output is basically moving our jaws and our tongues or typing [with] our fingers. We're ... limited to this very low output rate from our brains, and what if we could up that through telepathy? "Elon Musk is talking about silicon nanoparticles pulsing through our veins to make us sort of semi-cyborg computers ...I've been working and trying to think and invent a way to do this for a number of years and finally happened upon it and left Facebook to do it."
Writing on their website, they added: "What if you could see what was going on in your brain or body with the detail of a high resolution camera or MRI machine in a simple wearable?
"Openwater is creating a device that can enable us to see inside our brains or bodies in great detail. With this comes the promise of new abilities to diagnose and treat disease and well beyond - communicating with thought alone."