JumpStart: IdeaExchange Blog

I just read a copy of the Global Detroit Study, which “revealed the important role that the foreign born play in transitioning our region’s struggling auto manufacturing economy into to the New Economy”. This wasn’t a surprising conclusion given the facts revealed in the study, by the NVCA, and in Richard Herman’s book “Immigrants Inc.”:

• Foreign born people comprise only 12.5% of the U.S. population but possess half of all new Ph.D.s in engineering.
• Foreign born people account for 45% of all new Ph.D.s in life sciences, physical sciences, and computer sciences; and 40% of all new masters degrees in computer sciences, physical sciences and engineering.
• In the workplace, 24% of all scientists and engineers with bachelor’s degrees are foreign born and 47% of all scientists and engineers with doctorate degrees are foreign born. One quarter of all practicing physicians in the U.S. are foreign born.
• Foreign born people are 1.8x more likely to start a business than those born in the U.S.
• Over 50% of tech companies in Silicon Valley have a foreign born founder (including Google, Yahoo, Intel, PayPal, Sun Microsystems, and YouTube).
• Foreign born inventors apply for around 35% of international patent applications filed within the U.S.
• Foreign born people founded 25% of all public venture backed companies in the U.S. between 1995 and 2005, and within the high tech arena, this ratio shot up to 40%.

This is not a new phenomenon; consider American history and the entrepreneurial legends of the past: DuPont, Pfizer, Dow Chemical, Procter & Gamble, and Diebold were all started by foreign born people. Even Andrew Carnegie was born in Scotland before emigrating to the U.S. with his parents and becoming one of the most influential entrepreneurs and industrialists of his time.   

10% of JumpStart Ventures portfolio companies have been started by foreign-born entrepreneurs, including: Echogen Power Systems, Embrace Pet Insurance, Electron Database, CardioInsight, and Great Lakes Pharmaceuticals. All of these companies have been making tremendous progress, as we have been reporting through JumpStart Connect and other vehicles. The team at CardioInsight is a great example of many of the statistics demonstrated above: Ping Jia and Charu Ramanathan, two co-founders, were here getting PhDs from China and India, respectively. In the course of their research, they identified a technology with commercial potential, and have been working on growing the company since. CardioInsight has not only raised JumpStart Ventures money, but also brought in a CEO to lead the company through the next stage of growth, one who has previously led exits in a similar space. Where is the CEO from? Canada.

We need more of these types of stories in Northeast Ohio, plain and simple. Whereas Northeast Ohio and particularly Cleveland grew into a leading city in the U.S. because of immigrants, the rate at which these people have come to the region has slowed dramatically in the last fifty years. Luckily, lots of people are worried about this and there are several initiatives around town to make Northeast Ohio more welcoming to immigrants. One that I find incredibly exciting is TiE Ohio, the Ohio Chapter of The International Entrepreneurs. A little over a week ago, the chapter featured a talk by Dr. Hiroyuki Fujita, the founder and CEO of 3 year old Quality Electrodynamics (QED), a company on Forbes’ 25 Most Promising Companies list with over 60 employees today. Dr. Fujita’s story is similar; he arrived at Case from Japan to get a PhD, incubated his company for two years while proving out his imaging technology, and since that time, has secured global customers such as Phillips and Siemens, leaders in the field of imaging and MRIs. This event was just an example of the activities TiE is leading in the region; in the fall, they will have the International Entrepreneur Awards, a business plan competition for entrepreneurs, more networking support, and most of all, mentoring opportunities. I want to see you at the next event.

Other ways you can get involved with this exciting Northeast Ohio community of foreign born entrepreneurs, or entrepreneurs-to-be? 

1. Engage with JumpStart’s Launch100 program to get help growing your early-stage business.
2. Sign up for Inside Inclusion and JumpStart Connect to hear the latest and greatest on everything related to entrepreneurship in Northeast Ohio.
3. Hire an intern. There are a number of foreign-born students at local universities whose education and experience will benefit your company. Let me know if you are interested.
4. Share your stories with us so we can share them.

Any other ways I didn’t mention here? Let us know!

Cathy Belk is the Chief Marketing Officer of JumpStart. She specializes in branding, marketing communications, and business management. She brings 16+ years of experience in a variety of marketing and business roles, but gets her energy from working daily with entrepreneurs and their growing companies.

Here’s a run-down of some cool things that the companies in the JumpStart Ventures portfolio accomplished this month:

• Synapse Biomedical, which has a diaphragm pacing device to aid breathing for people with ALS or spinal cord injuries, confirmed that it is on track to more than triple last year’s revenue.
• Embrace Pet Insurance has surpassed its budget four of the past four months and is among the top-two in the industry in customer satisfaction.
• MAR Systems, which has a water treatment technology, is working with pilot customers; with one of those customers, MAR has proven that its technology is greater than 1000 times more efficient at removing mercury from waste water than the incumbent technology.
• Myers Motors, an all-electric vehicle company, announced its two-seater design.  One blogger wrote “I do wonder whether Myers may have just eaten Aptera’s lunch with this update.”
• Stanton Advanced Ceramics, which offers a non-traditional ceramic composite material that makes refractories more energy efficient and longer lasting, brought on paying customers with a coating version of its FireSlayer technology.
• CardioInsight Technologies, which has an electrocardiographic imaging technology and whose CEO has very successfully commercialized numerous cardiac technologies (raised $200 million, did IPO, etc), reached agreement with five key centers in the US and Europe to conduct clinical studies.
• iGuiders, which offers guided Internet search, forged a key partnership with an industry player and this partnership is potentially worth $23 million over five years. 
• Knotice, year-to-date, has increased the number of customers in key industries (retail, hospitality, consumer products, cable and telco, and financial services) by 75%, while growing revenue 50% and net income over 400% versus the same period of time in 2008.

They make these types of accomplishments every month. We catalog these accomplishments internally, and I’m going to be blogging about these more frequently externally. I think you’ll be impressed by the catalog of accomplishments these entrepreneurs achieve every single month. I know I am.

Becca Braun is President of JumpStart Ventures. She founded and led a number of early-stage companies and organizations, as well as worked as a private equity investor and management consultant. She received her MBA from Harvard Business School and her BA in Linguistics from Harvard University. She is keenly interested in the intersection of wealth creation and broad-based regional economic growth.

In order to see what kind of robustness we (we = Northeast Ohio) have in the warrior entrepreneur front, I am trying to build a shortlist of the top innovation-oriented entrepreneurs in Northeast Ohio over the past 30 years. Here are my criteria for what constitutes a warrior entrepreneur. He or she needs to have:

• Innovated from scratch through either finding a technology or a new way of doing business. There are many great business people who have grown companies, but I’m talking about that rare breed that finds or develops an innovation at the earliest stages, and
• As CEO, grown this innovation into a company that employed a lot of people (say, 100+ people). Separately, I’m planning to compile a list of serial founders, which is different from this list — it’s people who found a technology and then move on to their next technology and then move on to another one after that. But this list is about people who found a company and grow it to create many jobs, and
• Achieved an exit (IPO, recap, or acquisition) that created significant wealth for investors, employees, and themselves. This does not mean that all investors and employees made a lot of money, since there are all kinds of factors that come into play here, but rather someone in addition to the entrepreneur founder has to have gotten rich enough to retire quite comfortably.

Here are some people who I think fit all three criteria and therefore are warrior entrepreneurs:

• Monte Ahuja (Tran star Industries)
• Ray Dalton (OneSource Services, National MD)
• Tom Embrescia (Independent Group)
• Michael Feuer (Office Max)
• Bruce Harris (Conferon)
• Jim Hummer (Whole Health)
• AJ Hyland (Hyland Software)
• Jack Kahl (Manco)
• Mike Kennedy (LDI)
• Peter B. Lewis (Progressive)
• Steve Lindseth (Complient)
• Sydell & Arnold Miller (Matrix Essentials)
• Mal Mixon (Invacare)
• Bill Sanford (Steris)
• Charlie Stack (Flashline)
• Gil Van Bokkelyn (Athersys), and
• Tom Weisz (TMW Systems).

These are the “who” of entrepreneurship in Northeast Ohio and as we build our entrepreneurial culture, they are well worth celebrating. Indeed, I’d like to dedicate a wall (similar to what existed at the old EDI here in town) in our building to having their names and companies on it (I know, a website is the new “wall”, but I also like the concept of having a physical wall). This wall could use a few more people, though, so please tell me whom I have missed (I am sure there are many). By the way, there are about 15 additional people who I originally had on this list but a close look at the criteria didn’t quite put them on the list; they’re extraordinary entrepreneurs, but don’t quite fit the criteria for this specific list because either they did not start the company from scratch, they sold the company and created wealth before it reached 100 employees, they have not yet exited, or their success was not within the past 30 years. In any case, I am curious as to who else in Northeast Ohio should be on this “warrior entrepreneurs” wall. 

My goal is to have a wall of nearly 60 names within 10 years. Why? I don’t exactly know (this is a blog, not a whitepaper, ok people?) But, I suppose my calculation is this: with maybe 25 people on the list today (if you include a bunch of people I forgot), 50 equates to the addition of two to three warrior entrepreneurs per year that the pipeline is building. In Northeast Ohio over the past 10 years, an average of about four technology/innovative companies per year have reported exits, and maybe about half of those are significant wealth-creating exits. So, say two per year historically, which leads to 20 new on top of the 25 that are already there, if we remained in steady state with the past 10 years. Since the capital and innovation pipeline has shown itself to be building nicely over the past five years, then it makes sense that we should be able to increase the number of new warrior entrepreneurs with great exits over the next 10 years to, say, three per year, or 30 total. Twenty-five existing plus 30 new = 55, plus a little more stretch to reach round numbers = 60 (a very whitepaper-type calculation indeed…). 

What specific new additions will be made to this wall over the next ten years? Well, we (Northeast Ohio) have a crop of potential warrior entrepreneurs in people like:

• Rahul Aras (Juventas Therapeutics)
• Laura Bennett (Embrace Pet Insurance)
• Kevin Berner (Logos Energy)
• Mike Broderick (Turning Technologies)
• Don Brown (Arteriocyte)
• Bill Nemeth (Mirifex), and
• Mark Woodka (StaffKnex).

They bring their own unique signature styles to what they do at their technology companies – with some consumed by developing technologies that might change the world, others laser focused on the blocking-and-tackling of growing a small business, and others obsessed with fulfilling clear and compelling customer needs all day, every day. It is hard to tell who among these, and many more, will become the warrior entrepreneurs of 2019, but it is fun working with them as they grow their companies.

So, with a pipeline building and a goal in mind, imagine the list being 60 true warrior entrepreneurs strong (and hundreds more extraordinary entrepreneurs, to boot) by 2019. Imagine the wall full of familiar and new names, all having achieved actual, real successes in growing companies and changing the world. (When I’m particularly ambitious, I even dream that it has some more immigrants, women, Hispanics, African Americans and the like, but, well, that’s a whole different topic, ain’t it?). Regardless, the companies these warriors grow do and will employ many among us, including our children and grandchildren. The companies they grow will be our shared future. This warrior-wall-in-my-mind belongs to all of us.   

Next time:  I will write about a Phenomenal Founders wall that celebrates those people who founded a company that created wealth for employees and Northeast Ohioans, but for various reasons achieved great exits before they got to the 100 employee mark.  

Note: Thanks to my colleague Lynn-Ann Gries for her very lengthy and well thought out list of warrior entrepreneurs. She knows entrepreneurship in this town like the back of her hand!

Becca Braun is President of JumpStart Ventures. She founded and led a number of early-stage companies and organizations, as well as worked as a private equity investor and management consultant. She received her MBA from Harvard Business School and her BA in Linguistics from Harvard University. She is keenly interested in the intersection of wealth creation and broad-based regional economic growth.