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Life sciences, for example, and in some cases advanced materials, tend to be more capital intensive, tend to have to be a bigger deal. So how do we get big deals financed?
BHASKAR: A good thing that happened was BioFire Idaho Technologies had a huge exit. Once we have more of those kind of exits, we’ll have more attention to Utah—very much similar to what we have in IT, the big exits are the ones that brought VCs to start looking more at Utah.
GREEN: The training at the university level here is more slanted toward devices, and device deals are just not popular today. There’s very few LPs that are investing in funds. There’s very little device money available today. The exits are smaller, the multiples are lower.
But everything goes in cycles, so perhaps the device space will have more activity as we go forward. But right now, there’s only a handful of funds that have capital available for devices. And it’s a barbell: The device funds are like $200 million funds, while the life science funds, like diagnostics and biotech and pharmaceuticals, they’re multi-billion-dollar funds looking to deploy $50 or $70 million. Where the device guys want to put in $5 million or $10 at the most.
What do you think our image as a state is to your competitors, to your customers? What do you perceive as being your barriers?
JOHNSON: We’ve recruited several high-tech executives from the Bay Area and other places around the country. There is this stigma that Utah’s a backwater. We’re overcoming that.
The bigger deal is the critical mass of the tech community and business here. If somebody comes into Utah to work at a company, if that doesn’t work out, do they have a legitimate tech career in Utah? Until maybe the last few years, the answer to that has been no. But now it’s turning towards yes.
BHASKAR: Silicon Slopes is a good thing that comes to mind, where they made an effort to publicize the Utah companies on the map—so that if you lose your job in one company, there’s another company that you could step into.
But then look at it this way: If you’re in Silicon Valley, there are a large number of huge companies, so if you lose a job, you can go to the next one. If you were given a choice of Silicon Valley versus Utah, what would you do? The number of companies, the number of startups is just 10 times Utah. So statistically, you’re going to go to Silicon Valley.
RICHARDS: I think that this issue’s bifurcated, too. If investors and people want to come to Utah, if there’s money to be made, they’re going to come here and make money. But the issue of somebody taking a job in Ogden and sticking it out, that’s a separate issue.
The investors coming here and the cache that we carry in the national press is great, and it attracts a lot of people. We’re hot right now. But there are still issues of attracting somebody to live in Ogden or Provo if they’re coming from Silicon Valley. And there probably will be for a while.
SLOVIK: I moved here four and a half years ago. I moved here from San Francisco, and when I’d say, “I’m moving to Utah,” they’d look at me like, why? But I was just there last week. And now when I’d meet people at VCs or whatever, they’d say, “Oh, I hear there’s a budding technology center growing in Utah.”
They still think of us as the 9-year-old brother kind of tagging along. But it’s better than it was before, where it was, “Why on earth would you even think of that?”
JOHNSON: Do we do anything to get that message out, as opposed to just let it happen?
SKONNARD: We do deals.
LEHMAN: There was an article in The Economist about Utah and its economic development and the profits we’ve made—it’s stellar.
Internationally, there’s no cultural stigmatism attached to Utah. I mean, Utah is just a state that most people don’t know where it is on a map. Domestically, it’s a little bit different. We still get those silly jokes. But what I have found is any time I bring someone here, I have no issue getting them over any sort of preconception they might have about Utah. Your point of whether or not they would have other job opportunities is a bigger issue now than getting people over the cultural issues.
SLOVIK: My kids are four. And my wife was on Greatschools.org. She looked at the schools in the Bay Area, and they’re all getting nines and tens. And she looked at the schools here, and they’re getting threes and fours. And she said, “There’s no way I’m going to let my kids go to school here. So what is our plan to leave?”