Startup accelerator MassChallenge will soon open a new hub for emerging digital health firms in the Landmark Center, a former Sears distribution complex on the edge of the Fenway neighborhood.
Unlike the broader MassChallenge program, this one will be open only to startups in the digital health field — which local business leaders see as a natural outgrowth of the state’s strengths in both life sciences and technology.
The new center, opening this spring a short walk away from the Longwood Medical Area, will accommodate as many as 30 to 40 startups at one time, offering them free space, and mentoring and networking opportunities.
The idea was born out of discussions at the Massachusetts Competitive Partnership about ways to help make the state an epicenter for digital health technology firms.
“Longwood is known as one of the richest centers for health care in the country,” said Scott Bailey, managing director of MassChallenge’s flagship operation in Boston. “We need people to be able to walk from the hospitals and go to MassChallenge to engage with the [startups].”
Bailey said MassChallenge will initially rely on a $250,000 state grant, administered through the Massachusetts Technology Collaborative, to subsidize the operation. He expects to seek private sector sponsors to keep it going.
MassChallenge, a nonprofit, will lease 8,000 square feet at a reduced rate from building owner Samuels & Associates in a startup-oriented floor that Samuels calls Hatch Fenway.
The Partnership, a group of CEOs who lead some of the state’s biggest companies, identified the need to prioritize a digital health cluster more than a year ago. The new accelerator is just one of several ways the Partnership and its allies aim to encourage that sector’s growth, capitalizing on existing data research, cybersecurity, and health care sectors.
“Those seemed to be strengths that we had here in Massachusetts that could be combined to take a leadership role in what we think is going to be a revolution in the way that health care is going to be provided, not only here but throughout the world,” Partnership president Dan O’Connell said.
The Partnership approached Bailey at MassChallenge for help in developing the concept. John Barros, Mayor Martin J. Walsh’s economic development chief, then helped connect MassChallenge with Samuels & Associates.
Vertex Pharmaceuticals chief executive Jeff Leiden leads the Partnership’s effort to grow the digital health cluster, and his company will be one of the new accelerator’s first sponsors.
“The digital health care innovation hub will help showcase Boston’s deep talent pool of entrepreneurship and move us one step closer to our goal of making Massachusetts the best place in the world to start and grow digital health care companies,” Leiden said in a prepared statement.
Suffolk Construction chief executive John Fish, another Partnership member, said his company will donate the interior construction work for free. Fish said he’s optimistic that the accelerator can help encourage talented entrepreneurs in the digital health field to stay in Boston or move here from other parts of the country.
“I think we’ll be able to attract the next generation of health care leaders,” Fish said. “To me, this is going to send a clear signal of the business community’s commitment to the future of health care.”
MassChallenge is close to hiring a full-time person to run the new accelerator, and a ribbon-cutting ceremony is expected within the next two months, Bailey said.
He said he also hopes to reach beyond Boston to make connections for digital health IT startups across the state.
Peter Sougarides, a principal at Samuels, said the firm offers flexible lease rates and lengths to the startups in the 100,000-square-foot Hatch Fenway space. The building was recently used by Blue Cross Blue Shield of Massachusetts as its headquarters, until the health insurer relocated last year.
“When I talk to a lot of these young entrepreneurs, I get so energized,” Sougarides said. “Real estate is a real pain for them [but] we can do a little to help their real estate needs so they can focus on what their main business is.”