Article perview reprinted from IN VIVO - July 2009
A decade ago, during the device industry's first financing crisis, medical device incubators played a crucial role in keeping small start-ups viable. But incubators themselves soon ran into problems, most notably in finding a sustainable financing model for themselves. California-based Intersect Partners has been one of the most successful incubators but it, too, needed to find a new model to make incubation viable. Read more...
Intersect Partners: Does the Incubator Model Still Work?
Article perview reprinted from IN VIVO - July 2009
George Wallace and Andy Cragg collaborated for years successfully. But finding the right model for their collaboration was something else.
** George Wallace and Andy Cragg found early on that their collaboration on ideas for new technologies and companies could be fruitful, with Cragg supplying the technology ideas and the clinical bona fides and Wallace the business expertise.
** The two met when Cragg, an interventional radiologist by training, helped vet the laser technology of a Midwest cardiovascular start-up Wallace had joined.
** That company failed, but Wallace and Cragg would go on to work together on several successful companies, including neurovascular company Micro Therapeutics and spine innovator TranS1.
** Those early collaborations were informal efforts, with each holding down full-time jobs elsewhere. When Wallace and Cragg decided to launch their own incubator, Intersect Partners, they found themselves having to re-invent the model.
If the current financing woes of many medical device start-ups are unsettling, it may very well be because, notwithstanding the once-in-a-century economic crisis that triggered it, the current depressing fund-raising climate isn't so much unprecedented, but rather just the opposite. Compared with today's chilly reception from private investors, many if not most medical device start-ups found fund-raising just as difficult a decade ago. The story's well known: following an aggressive period of venture backing in the late 1980s and early 1990s, a large group of medical device start-ups went public in the mid 1990s, hoping to offer a robust exit for their investors who somehow missed the point that the companies weren't ready to be public companies—with the implicit promise of predictable revenues and earnings that public status entails.
- By David Cassak
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