Some of the most prominent figures in the Triangle and the state joined forces Monday morning for the announcement of a new type of entrepreneurial incubator.
The launch of the Blackstone Entrepreneurs Network, held in Bay 7 of American Tobacco Campus, drew around 300 attendees. The network, described as the first regional integrated initiative, is being funded by a grant from the Blackstone Charitable Foundation.
Steve Schwarzman, the co-founder, CEO and chairman of investment and advisory firm the Blackstone Group, predicted that the foundation’s investment would provide an enormous boost to the state’s economy.
“In creating an ecosystem to support aspiring entrepreneurs, the Blackstone Entrepreneurs Network [is] expected to double the number of startups coming out of this region, attract venture capital at all stages, create approximately 17,000 jobs, attract over $800 million in venture capital, generate revenues of close to $5 billion and [have] countless secondary impacts on the local economy,” he said.
“The potential is tremendous. The time is right, and the talent sitting in this room, [exemplified] by the heads of these universities and the Research Triangle, is really a remarkable group.”
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Schwarzman, whose son graduated from Duke Law School and whose brother attended UNC, caused some titters during his speech when he exaggerated the size of the grant by a factor of 1,000. He said the investment would be $3.6 billion.
The grant, which actually amounts to $3.6 million, will be used in part to hire 15 “master entrepreneurs” who will help form 30 startup teams a year for the next five years. Many of the startups will involve research being conducted at UNC Chapel Hill, Duke, North Carolina Central and North Carolina State, which are all partners in the program.
Gov. Beverly Perdue hailed the grant as an important investment in the North Carolina economy of tomorrow.
“With academic leaders like those seated at the front of this hall today and business leaders like Steve Schwarzman, we have the ambition to do whatever it is we need to do in North Carolina,” the governor said. “This investment today will ripple across our economy for years to come and create thousands of jobs and bring millions of dollars in new investments in technology to this great state.
“It’s that creativity, that innovation and entrepreneurship, that commitment that we as a people have to stay strong on,” Perdue added.
The Blackstone grant is a new example, she said, of the “generational commitment to education” that has powered and will continue to drive the state’s economic life.
Perdue and U.S. Sen. Kay Hagan were among multiple speakers at the event to compare the grant to the creation in 1959 of the Research Triangle Park. The park helped lure innovative businesses to a state where tobacco and textiles had long been dominant industries and softened the transition to an economy in which information, electronics and biotechnology are increasingly prominent.
“Investments in innovation and creativity are investments in our future economic vitality, and I greatly look forward to seeing these ideas grow and mature,” Hagan told the crowd.
“I’m looking forward to great success and the rest of the world knowing about our young entrepreneurs and their entrepreneurial spirit,” added the legislator, who serves on the Senate’s Small Business and Entrepreneurship committee.
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U.S. Rep. Brad Miller of Raleigh — a Democrat like Perdue and Hagan — told the audience that he believed Blackstone’s grant would aid local researchers in taking their work to a new level.
“We have lagged behind some other research centers in turning research ideas into commercial applications, into new businesses,” Miller said. “We've lagged behind Silicon Valley. We've lagged behind the Boston corridor. And a big reason for that is they’ve established support systems in those areas for scientists to try to figure out ... how to take those ideas from the laboratory to the marketplace.
“This grant from the Blackstone Charitable Foundation goes a long way to filling those gaps — goes a long way helping to turn ideas into businesses.”
Ginger Lew, a senior counselor on the National Economic Council and the head of the nation’s Small Business Administrator, took to the stage to praise the importance of new ventures like the ones Blackstone will nurture.
“Startups play a key role in job creation in the United States, since young companies generate the lion’s share of net new jobs,” she said. “We also know that startups hit above their weight on innovation and will continue to develop the breakthrough products and services that allow the United States to compete and win in the global economy — breakthroughs in industries such as information technology, biotechnology and clean energy.”
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Monday’s announcement was co-hosted by Holden Thorp, the chancellor of UNC Chapel Hill; Charlie Nelms, the chancellor of North Carolina Central University; Richard Brodhead, the president of Duke University; and Randy Woodson, the chancellor of North Carolina State University. The boss of three of those academic leaders — Tom Ross, the president of the University of North Carolina system — attended, although he didn’t even get a seat on the dais, let alone a moment behind the microphone.
Planning for the Blackstone Entrepreneurs Network began about a year ago. The network will be based at UNC Chapel Hill. Its first order of business is to recruit an executive director. She or he will then hire the 15 master entrepreneurs, who in turn will begin forming startup teams.
Along with the four Triangle universities, the other main local partner in the new venture is the Council for Entrepreneurial Development.
The Blackstone Charitable Foundation was founded in 2007. Initially, its work involved traditional corporate philanthropy such as grants to educational programs for disadvantaged children.
That changed after the economic collapse, according to Christine Anderson, a senior vice president at Blackstone. In 2009, Schwarzman and other executives decided “we really need to do something to contribute to the rebuilding of the country,” Anderson said.
One advantage of the pivot is that it plays to Blackstone’s expertise in advising past and present startups, said Amy Stursberg, the executive director of the Blackstone Charitable Foundation.
“We could look at this project and really add value as a firm,” Stursberg said.
Blackstone has already launched a program to teach college students about entrepreneurship. At least one other regional initiative such as the network that was announced Monday is being planned.
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The chancellor of NCCU believes that the entrepreneurial venture will provide a platform for biotechnology and biomedical researchers at his university to bring their work into the world.
Nelms noted that about 300,000 square feet of scientific facilities have been built on his campus in the past 13 years, among them the Biomanufacturing Research Institute and Technology Enterprise.
“Just taking BRITE alone, we’ve filed around four provisional patents within the last 12 months,” Nelms said after the event ended.
Central is searching for a new dean for its business school, whom the chancellor hopes to have in place by September. “What we’re hoping to do then is to make entrepreneurship one of the tenets for the business school,” Nelms said.
During his introduction of Hagan, Duke’s president said that there has been a surge of entrepreneurial activity among students and faculty at area universities.
“People at nowadays don’t want to go to work for someone else,” he said. “They’d far rather create enterprise and have someone come to work for them.
“But people need help to be successful entrepreneurs. We talk about self-made men and women, but every self-made man and woman needed a little help along the way,” Brodhead continued. “And I think that what’s so brilliant about the Blackstone Charitable Foundation’s concept is it’s supplying the mentors of the people with the experience to give you the help ... to go on and be effective. And it will enable our schools to be successful together in a way that none of us would have been alone.”
NCCU already works with other area universities to conduct research and pursue other programs, Nelms noted in an interview. This partnership is different in that brings representatives of all four schools together for one initiative, the chancellor stated.
“It’s a wonderful opportunity, not only for the university, but for the Research Triangle Park generally,” he said.
Michaux, one of Durham’s state representatives — and also a Democrat — concurred.
“It think it’s a very strong initiative, particularly as it’s going to be bounced from campus to campus,” he said.
Startups are vital to America, Michaux commented, recalling that his father started a local real estate and insurance business in Durham nearly 70 years ago. “It’s put us into the mainstream of a lot of things,” the representative said.
What’s more, Michaux added, businesses like Blackstone don’t begin fully fledged. As Thorp noted, the firm that now invests in a variety of operations that would if combined form the world’s seventh largest corporation by revenue started with just $400,000.
“Unless you have the small startup, you don’t have the large startup,” Michaux said, calling small businesses the “life blood” of the economy.
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Norris Tolson, the president and CEO of the North Carolina Biotechnology Center, agreed that the Blackstone network represents a great opportunity to boost business in the Tar Heel State.
“Out of this, you’ll get some fabulous new growth in North Carolina,” Tolson predicted.
The Biotechnology Center was created in 1984 to help build the state’s biotech industry. Today, Tolson said, there are about 58,000 biotechnology jobs in the Old North State. Those workers have helped to create around 200,000 jobs that indirectly funded by biotech.
With the help of the Blackstone Entrepreneurs Network, Tolson hopes to add up to 75,000 direct biotechnology jobs. That could push the state’s direct and indirect biotech job force to perhaps half a million people.
“It’s going to take us to new heights of potential in this state,” the center’s leader said.
The center already works with universities in the state, and its leader definitely plans to get involved with the Blackstone network.
“We’re anxious to have them come out and see what we do at the center and link arms,” Tolson said.