RSD wrote:I think there are a handful of reasons that make a pretty solid rationale for locating or re-locating to a biotech hub.
1. Access to venture capital. VC money is concentrated, so companies go to where the money is. Real estate costs and even cost of living/salary costs don't make up that much of a biotech's budget.
2. Access to talent. Biotech hubs tend to have lots of academic research centers and big pharma, which means access to both entry level and experienced talent. If I take a job at the only biotech in Omaha and it fails, I have to relocate again. If my startup in Boston fails there is a significant job market for me.
3. Culture. This ties in with competition for talent. In places where there are no alternative workplaces and relatively few candidates (compared to a Boston or SF), the culture can get stale. I think a bit of turnover and competition makes for a more innovative, driven to succeed culture as opposed to the punch the clock/I've gotten comfortable here and there is no place else in town culture. I think local networking opportunities with other biotech and pharma companies, employees, and academics also helps.
I can see the access to VC money. The cost of office real estate in Dallas is about $18 to 23 dollar per sq. foot and San Francisco is about $70. The same with Boston (Cambridge) at $70. Even salary differences of about 2.5X the cost of living. A modest house in Dallas might cost $300,000 and in the Bay Area it is easily $600,000 to 1M. That money will cost VCs and investors in these companies versus if it stayed in Dallas. For a start-up or mid size company, that's a lot of money. And this was Texas money that funded the basic research for these companies and it creates jobs elsewhere (non TX taxpayers)!
Access to talent. Please, Texas has 12 medical schools and has the largest number of life graduates. Plus, how hard is it to get a senior management guy with industry experience (Boston, Bay Area, or Chicago) to move to Texas to manage a biotech here. Less taxes, lower unemployment, and cheaper homes. Public schools about the same. Many CA residents are flocking to Texas because of the taxes in CA and housing costs plus the taxes on retirement accounts. Look at the local trends in migration from CA to TX.
I agree with the local networking angle. I have more success networking outside of Texas than locally. The culture thing is a personal preference and where you were raised. There are ambitious professionals here that are driven to success here but in the life sciences they don't have the right environment to do that (just academia).
However, it doesn't explain why these local advocacy groups and certain employees of state agencies meant to promote the interest of the state could care less (or even promote) about the migration of these companies to other states? Yet, they patronize the job seekers and life science graduates with a sugar coated message.
FYI: I have been asked to give a short presentation about this topic to some influential entrepreneurs in the Dallas business community.
What would you tell them to promote biotech in this state, especially N. Texas?