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like that—unless we go back to the future, which I don’t see happening. I don’t see anyone paying for an R&D engine that includes paying for 300 to 400 people. It ain’t happening. Are there billion dollar companies, or companies with that kind of potential? Absolutely. But you’re not going to see that size of R&D group built again. It’s just too expensive in today’s world. So much of it can be outsourced that couldn’t be outsourced before.
X: It sounds to me like there’s a lot of potential to create value, but maybe not so much in terms of jobs. Where will the job creation come from?
SG: These places will create jobs, but they’ll grow to the size of 40-50. If they do their own manufacturing—which I don’t know why anyone would do today because of the cost of bricks and mortar, and investors don’t like owning buildings—but maybe on the top end they’ll get to 100 people. Not to be cold, but the goal of the biotechnology industry is not just to make jobs. Jobs are a fallout from starting companies. The goal is to develop products that change people’s lives, and make a difference, and actually do make money. So, the way a particular region can generate jobs is to make sure the region generates lots of companies as opposed to one giant success story.
X: I hear what you’re saying, but for a young person that’s starting out or someone with a really good education and some experience—a lot of them are unemployed locally. Where can they realistically turn? Does the region need more cases of a company like Covance coming in and buying up part of Rosetta? Can Big Pharma or contractors to fill out that ecosystem?
SG: Sure. Or people should consider getting involved in some sort of area that’s peripheral to the biotech industry. Maybe you’ve got a science background, and maybe you’ve never thought about it, but if there aren’t any jobs, maybe you go to law school. You could go to work for an IP firm. Or you get some further training and go to work for some investment group, or in PR. Or, you say, if your love is really in catching on at a science-based organization and doing science, maybe you work for less than you thought you’d work for to get your foot in the door.
I’ve counseled students and other people that if this is your passion—don’t necessarily do it for free, but you might offer to do it for free for a little while until someone catches on that you’re talented. Then when the next job opening comes open at that place, maybe you’ll get the job.
X: You said before that you’re having fun. That’s surprising given all the turmoil we hear about in the venture industry and portfolio companies. What’s fun?
SG: I still like being at least peripherally associated with good science. And building things. I like to build companies and see people’s ideas reduced to practice and tested in people. I still get a big kick out of that. I’m no stranger to working hard, so the fact that we’re in a difficult investment climate, I’m no stranger to that either. It’s part of life. I don’t let it eat me up. If it did, I wouldn’t be terribly effective at what I’m doing. It takes a certain amount of conviction to roll up your sleeves and get the job done.