Jeff Amerine

Techpreneurship, with Jeff Amerine

(Jeff Amerine is an IA advisor and officer with the University of Arkansas Technology Licensing Office. Each Thursday, his Techpreneurship blog will appear in INOV8. Drop him a line in comments.)

How many of you have ever heard of George Rathmann?  I have to admit prior to just recently, I hadn’t.  Well, it turns out George Rathmann is often referred to as the “Bill Gates” of biotech…

Back in 1980, George was one of founders and first CEO of Applied Molecular Genetics, now known as Amgen.

Amgen is now the largest independent biotech firm with a $56 billion market cap, $15 billion in annual revenue, and 17,000 employees.  Check out its profile at www.amgen.com.

In 1980, George and a few other intrepid techpreneurs and research scientists jumped out of their corporate jobs and academic positions to create a new kind of company…Well, George really did more than create a new kind of company, he created a brand new industry — biotech.

At that time there was no such thing as biotech.  1980 was also a time very similar to 2009.  High unemployment, weak economy, significant international strife — these were all attributes of 1980. Per the conventional wisdom, not exactly the best time to leave gainful employment to start a new company, much less create an industry.

Much like most hard-headed techpreneurs, George Rathmann did it anyway.  Somehow Rathmann, sometimes called “Golden Throat” for his ability to sell investors on the Amgen story, was able to gather sufficient venture capital to get Amgen rolling.  In 1983, they went public with a successful $42 million IPO.

Early investors included legendary characters like Pitch Johnson from The Asset Management Company, one of the first VCs in Silicon Valley.

Pitch is another story for another time…

What is probably the most amusing part of Amgen’s early capitalization efforts was the part beer played in the process. I know what your thinking.  Beer, cold pizza, and Mountain Dew play a part in every startup, right?  Well, for Amgen, it was a bit different.

You see, one of the major early strategic partners was none other than the Kirin Brewing Company from Japan.  At this point, you’re probably saying, what the heck would a Japanese brewing company need from a biotech firm?

It turns out, Amgen’s work in microbiology and fermentation to cook up the “bugs” they needed to create great medicine also had great uses in improving the fermentation processes Kirin needed to make great beer!  Current Amgen CEO Kevin Sharer has been quoted as saying “we could see our last dollar prior to closing the deal with Kirin.”

So what’s a techpreneur of 2009 to learn from George Rathmann?  Here are my thoughts.

Some of the best companies and industries come out of the worst of times……

And you never know when beer might save the day!

For more on Rathmann, check out this link from Newsweek….http://www.businessweek.com/magazine/content/05_38/b3951047.htm

Let me know what you think, and please share  your stories about how beer saved the day for your venture…

Arkansas as a hotbed for innovation?  It could happen. Jeff Amerine thinks it could happen.

The most recent issue of Arkansas Business included a special supplement called Arkansas Innovation that highlights several reports from state organizations and firms that are helping foster an environment for growth in the “innovation industry.”

Amerine, IA advisor, University of Arkansas Technology Licensing Officer and INOV8 contributor, lent his expertise to an article on the state of innovation in Arkansas and how it seems poised to emerge on the national radar.

Amerine is not a former Marine, by the way, as noted in the print version. And we may have shortchanged him. He is among a select few who are both Navy and Air Force, having been commissioned into the Air Force after his graduation from the Naval Academy.

Jeff served as an ICBM Missile Launch Officer (Minuteman III and Peacekeeper) for four-plus years, was selected for special ops – Air Force Combat Control (but was injured in training), and finished his military career as an Air Force R&D program manager for defense communications systems.

That last assignment set his commercial/industrial career into motion, leading to Westinghouse and ultimately to Silicon Valley. He has held senior leadership positions in seven startup ventures and three Fortune 500 companies.

Jeff knows what he’s talking about. As most INOV8 regulars know, he is author of the soon-to-be renowned (it’s still too new to be fully renowned) Techpreneurship series that appears in INOV8 each Thursday. He got pulled away unexpectedly last week, but he’s back.

Look for a new installment this week. In the meantime, Jeff’s last post about Y Combinator and whether its model could work in Arkansas has elicited some great commentary.

Fascinating Forbes.com commentary on market economics, the tenets of Ayn Rand, and how the real-value contributors — entrepreneurs, innovators, inventors — don’t receive their just compensation.

Should we leave the free-market system alone to auto-correct what author Sramana Mitra believes to be its flaws? Are they flaws?

Let us know what you think in comments.

Jeff Amerine

Techpreneurship, with Jeff Amerine

(Jeff Amerine is an IA advisor and officer with the University of Arkansas Technology Licensing Office. Each Thursday, his Techpreneurship blog will appear in INOV8. Drop him a line in comments.)

So what’s a Y Combinator??  Sounds like some esoteric genetic process mere mortals couldn’t possibly understand, doesn’t it?

Well, it turns out that Y Combinator is a seed-stage funding source based in Silicon Valley.  The company was founded by Paul Graham, a successful serial software entrepreneur (or I should say ”hacker,” as he would rather be called).

Y Combinator approaches investment in a very different way.  They typically don’t invest more than $20K in a given deal, and they only look for a very small percentage ownership in exchange for their investment.

The Y Combinator force multiplier is that they couple-seed investment with something of much greater value – proven expertise.  In a sense, they really are an incubator, startup boot camp, or strategy gauntlet for the best and brightest software developers.

Paul Graham says that they are more interested in the strength of the startup’s technical talent and ideas than the depth of their business plan.

Check out their website and a recent Youtube video from Startup School 2009.  The video has some interesting soundbytes from the founder of Twitter, the developers of Facebook game Farmville and many others.

Unconventional?  Absolutely.  Proven?  Without a doubt.  Could it work in Arkansas?

I’d be interested in your thoughts.  Fire away!