At TEDIndia in 2009, Jane Chen, cofounder and CEO of Embrace Innovations, asked the audience to close their eyes and imagine what might fit in their hands — an apple, a wallet, something small. Next came an image of a premature baby, not much larger than the hands holding it. According to the World Health Organization, 15 million babies are born premature each year. Embrace notes that more than one million die within the first month. For those who survive, some will suffer severe long-term health problems — diabetes, heart disease, low IQ. Chen said, “many of these problems could be prevented if these babies were just kept warm.” To date, Embrace Innovations has helped 150,000 babies across 10 countries with its simple, cost-effective infant warmers and an interesting business model — it’s both a nonprofit and a for-profit social enterprise.

Embrace’s first infant warmer – it looks like a tiny sleeping bag – started as a class project at Stanford University in 2007. The course, Design for Extreme Affordability, challenges teams of MBAs and engineers to develop affordable technologies for people living on less than a dollar a day. That year, Stanford asked students to design an intervention for neonatal hypothermia. It needed to cost one percent of what a traditional incubator cost (in the U.S., that’s about $20,000). Chen, along with Linus Liang, Naganand Murty, and Rahul Panicker, designed the Embrace Infant Warmer to help premature and underweight babies in the developing world. Together they founded Embrace and registered as a 501(c)(3) non-profit in 2008. Then they moved to India.

The company targets emerging markets. Many women are either too far from the hospital or lack resources to get there in the hours after birth. The company designed its first infant warmer, Embrace Care, to work without electricity for use in homes or hospitals. The Nest is similar, but designed for use in hospitals and ambulances and requires intermittent use of electricity.

In 2008, Embrace registered as a 501(c)(3) organization, but by 2012 it decided to spin out a new company — a for-profit social enterprise focused on design, manufacturing, and commercial sales named Embrace Innovations. The nonprofit arm of the company focuses on partnerships with NGOs and government entities in emerging markets like India, where the company has headquarters, as well as those in San Francisco. The nonprofit also distributes infant warmers at no cost to clinics and hospitals with limited access to modern medical equipment such as incubators in countries like India and China. Embrace receives funding through contributions and from royalties — paid to the nonprofit from its for-profit side, Embrace Innovations.

Today, Embrace Innovations leads research and development of new products, like Embrace Angel, an upcoming “ecosystem” that combines sensors and analytics to monitor vitals. Perhaps Embrace’s best innovation was its decision to partner with BigCos like GE. The partnership pairs Embrace’s technology and GE Healthcare’s distribution and manufacturing power as well as expertise and global reach. “Together, we can achieve Embrace’s mission to give every child an equal chance for a healthy life,” Chen said.

Embrace Innovations also started a new company, Little Lotus, with the help of 676 Kickstarter backers who pledged $130,398. Its products include a swaddle, sleeping bag, blanket, and scarf to help regulate temperature. For every item purchased, Little Lotus puts $25 toward the purchase of an Embrace warmer which costs $200.  

“We tried to understand at the root of the problem without being biased by what already exists. And then we thought of the most simple solution we could to address this problem,” Chen said.

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Jane Chen will join NewCo CEO John Battelle, as well as the CEOs of Earnest and Nuna Health, on March 15 at NewCo’s SXSW panel — Stories of Purpose-Driven Companies.

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