It sounds like Big Brother - a device that reads and interprets a person's face to detect fatigue, inattention, even emotion.

But Seeing Machines, a Canberra-based start-up company, hopes its technology will one day save lives: it is developing a system that can be installed in trucks to warn drivers when they are not paying enough attention or are about to nod off behind the wheel.

The company was set up in mid-2000 to commercialise research that had been carried out at the Australian National University, partly funded by Volvo, the Swedish automotive group, which wanted to test the safety of its new designs and features.

"Very many traffic accidents, up to 56 per cent, are caused by distraction, lack of concentration or tiredness on the part of the driver. Increased knowledge of what the driver looks at while driving can help us to design safer vehicles," says Trent Victor, project manager at Volvo Technological Development.

Having developed a product to meet the design needs of Volvo and others - Toyota, Nissan and Daimler-Chrysler are also customers - Seeing Machines is now adapting its technology to make a product for the mass market.

It is in the process of raising A$5m from private investors to help fund the A$10m it estimates it will need to develop a product for the truck industry over the next three years. To this end, it secured a A$3.43m grant from the Australian government in January and it also has revenues from faceLAB, the commercial product, its first, launched last April. As well as the auto sector, it has found a market among scientists and psychologists studying the human face.

The company is hoping, says Glenn Dickins, chief operating officer, that at least one of the new private investors will be an auto components maker with which the company can work to help customise the new truck product and eventually market it.

Simon Cant, a partner at Tinshed, a Sydney-based business angel investment group that is considering backing the company, says raising the funding will be a challenge given the difficult market conditions. But he says, Seeing Machines' advantages include both its potentially huge market - there are 5m trucks on the world's roads- and its relationship with Volvo.

"That relationship with Volvo is a critical source of validation of the technology," says Mr Cant.

When negotiating with the university over the company's formation, Alex Zelinsky, chief executive, says a priority was to gain full control of the intellectual property behind its technology, rather than just a licensing arrangement. The company took the Stamford University model, says Dr Zelinsky, giving ANU and Volvo minority stakes in return for the science they contributed.

"This is increasingly important for investors, to be seen to own your intellectual property," says Dr Zelinsky who before founding Seeing Machines was head of ANU's department of systems engineering and remains a visiting professor. Remarkably, given the many high tech companies that have come out of universities in other countries, Seeing Machines was ANU's first IT spin-off. The university has a subsidiary, Anutech, that commercialises and licenses out its research but previously had not directly created an IT company. Now, however, several other high tech ANU spin-offs are in the pipeline.

Dr Zelinsky says part of the satisfaction of forming Seeing Machines and developing and commercialising the research within Australia is that the company, in its own small way, is helping to reverse the brain drain.

He says that at least four of the dozen scientists it employs, out of a total staff of 16, would otherwise have almost certainly emigrated. In addition, the company, which believes it is at least 18 months ahead of its nearest competitor, has been able to attract scientists from overseas to its team, including from Oxford University. "Australia has been doing too good a job of providing foreign economies with good graduates and good ideas," he says.