Tom Fogarty Out At Three Arch

Dr. Thomas Fogarty has been fired from Three Arch Partners, a Portola Valley, Calif.-based venture capital firm he co-founded in 1993. The move came last month, after the two parties had spent nearly a year trying to work out their differences.

?It’s like giving birth to a child, but then having to leave it behind, which is hurtful? Fogarty said, during a phone interview from his Menlo Park office. ?But I’ve been kicked out of better places than [Three Arch], and I wouldn’t say that I with them well.?

Fogarty is a legend within the medical device industry, dating back to when he created the Fogarty Catheter while still a University of Cincinnati medical student in the late 1950s. The device currently is used in over 300,000 surgical procedures each year, and is familiar to almost any physician involved in interventional medicine. After receiving his MD in 1960, Fogarty continued working on his catheter — which ultimately inspired spin-off application like balloon angioplasties and less-invasive biopsy procedures – and other devices like Fogarty surgical clips and clamps. He also worked as a surgeon.

By 1980, Fogarty institutionalized his inventive efforts by launching a medical device incubator named Fogarty Engineering. Thirteen years and several successful startups later, Fogarty teamed with Mark Wan and Wilfred Jaeger to launch Three Arch Partners, a venture capital firm focused on early-stage medical device companies.

Wan and Jaeger each had significant venture capital experience – Wan had been a GP with Brentwood Associates, while Jaeger had been a GP with Schroder Ventures – but it was Fogarty’s cache that really helped Three Arch raise its inaugural fund. The firm eventually grew to six investment partners, and raised a $450 million fund late last year. Among its limited partners are the Pennsylvania State Employees’ Retirement System, Ford Foundation, Columbia University, the University of Chicago and SBC Communications.

In the midst of that fund-raising process, however, a rift began to form between Fogarty and his fellow partners. At issue seemed to be the amount of time Fogarty devoted to the firm, given his continued oversight of Fogarty Engineering, a personal winery in Woodside and teaching duties at the Stanford Medical School.

?I really did try working out the issues [with Three Arch], but I guess that I committed some crime that couldn’t be taken back,? Fogarty says. Mark Wan confirmed that Fogarty had left the firm, but declined to comment further.

For now, Fogarty plans to redouble his efforts with Fogarty Engineering, which he says has several good ideas that were put on the back-burner while he tried to fix his Three Arch relationship. He also plans to make select investments on his own, and maintain most of his current board seats. As for financial ties to Three Arch, Fogarty says that he needs to review his limited and general partnership agreements, but does not expect to participate in any capital calls for the most recent fund..