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in as vacancies open up. The young companies stay for about two and half years before they move on and raise their seed round funding. The latest group of five successful applicants was admitted in June.
The twelve companies in residence are now settled in the 19,000-square feet of space the Fogarty Institute occupies in what was once the cafeteria and kitchen of El Camino Hospital’s old medical center, which has been replaced by a new building. Residents receive office space, volunteer mentors recruited from a rich pool of Bay area expertise, and about $50,000 to $100,000 in startup capital, says Fyfe.
The institute’s annual budget is now about $2 million, and the operation is almost entirely funded by donations, says Fyfe. Support comes from private philanthropists and corporations, including Edwards Lifesciences. As a non-profit, the Fogarty Institute receives a stake of about 5 to 10 percent in the companies it supports.
“We make sure that the founding company retains a lot of the value,” Fogarty says.
The current crop of startups includes four companies that are hoping to improve technologies used in childbirth. Dr. Coelho, the Hollister family doctor, founded MedicalCue to help physicians react right away when newborns develop breathing difficulties that could quickly lead to death or disabling damage. His computerized device, NeoCue, monitors the infant’s vital signs and issues prompts when emergency treatment is needed.
Fyfe says part of the reason why the institute accepted such a large percentage of companies concentrating on childbirth was that many venture capital firms weren’t interested in funding the work. The financial returns wouldn’t be as great as those for other health solutions, she says, though the impact for women and babies could be great.
One of the new resident companies, First Pulse, is trying to replace problematical methods of fetal monitoring during labor with a light-based device that tracks the fetus’s heart rate and other factors. And a startup called Materna Medical is developing a device to prevent tearing of tissues in the mother’s pelvis during labor, a common occurrence during vaginal births. Materna’s founders, Mark Juravic and Michael Stewart, started work on the project as participants in the Stanford Biodesign Program.
Fogarty says inventions like these are less likely to come from top-down thinking by specialists removed from real-life experiences.