By Tom Still
– Is Wisconsin producing enough startup companies? No, especially when all
startups are counted… whether those young companies are bakeries, burger
joints, beauty salons or biotechnology firms.
often matters more than the sheer number of startups is the survivability and
“scale up” stages for young companies, a time when emerging firms produce increasing
numbers of jobs that pay solid salaries.
has some prominent examples. Companies such as Epic, Promega, Astronautics,
Direct Supply, Logistics Health, Renaissance Learning, Trek and many more were
all Wisconsin startups not so long ago. As they grew, they collectively
produced thousands of jobs created through innovation born close to home.
Read this commentary in the Wisconsin State Journal here.
instructive example is Madison-based Exact Sciences, which developed the first
noninvasive screening test for colorectal cancer. The company recently
announced its work on a lung cancer detection test, as well as plans to locate
its headquarters in downtown Madison.
company has a grand total of two employees when Kevin Conroy and Maneesh Arora,
former executives with Madison’s Third Wave Technologies, moved a near-death
molecular diagnostics company from Boston to Madison. Why Wisconsin? Conroy and
Arora were convinced the talent pool, work ethic, research base and industry
ties in the Madison area were under-valued.
Exact Sciences owns a federally approved product that will save lives while
creating economic value for the company, its employees and the region. Already,
more than 8,000 physicians in 50 states have ordered Exact’s “Cologuard” test. There
are now more than 500 employees at Exact Sciences in two main locations and the
firm plans to grow to 900 workers within a year or less.
only are those employees well-paid versus the Wisconsin average – recently
reported at about $44,000 per year for 2014 – they are happily staying put.
Exact’s employee “engagement rate” rate has been 92 percent or better for five
years, which compares to a national rate of 33 percent.
company’s growth was aided first by a state loan and most recently by tax
credits through the Wisconsin Economic Development Corp., which required that
Exact invest $26.4 million on its own over time while creating 758 jobs by late
2020. The direct and indirect payback on the loan and credits is already
tangible, as Exact has paid about $6 million in state payroll taxes alone since
why helping startups “scale up” is vital to Wisconsin. The potential payback
leads to increased vibrancy, not only for the company itself, but the larger
business landscape and the sense of opportunity it creates for young, talented
perception about Wisconsin among young people is that the state lacks engaging
and well-paying places to work. Exact Sciences is countering that perception
and the “brain drain” by hiring half of its employees from the UW-Madison and
many more from other state colleges and universities.
combination of the company’s 30,000-square-foot production facility on
Madison’s South Side and the prospect of a downtown location means Exact’s
workplaces themselves will become a draw – not only for its workers, but others
who may want to locate nearby.
company is also using its status as a rising biotech star to attract money to
Madison. About 50 investors and analysts from outside Wisconsin will attend a
company “Investor Day” June 25; part of the exercise will include examining
other opportunities and resources in the area.
companies that quickly grow from startup status often tap into global
marketplaces. An example of Exact’s international reach will take place Tuesday
when the Swiss ambassador to the United States, Martin Dahinden, shares a stage
with Conroy during a Wisconsin Innovation Network luncheon in Madison.
minority of startup companies survive and many that do are often more n the
“mom-and-pop” category than a fleet-footed gazelle such as Exact. The more
Wisconsin can plant startup seeds in fertile ground, however, the more likely
it is that young companies will take root and flower in our own backyard.