Some people just don't know when to say whoa.
Roger Newton and Jennifer Baird are two of them, indefatigable entrepreneurs who built successful companies, then cashed out - Newton with a big share of the $1.3 billion sale of Esperion Therapeutics to Pfizer, Baird with the co-founding and subsequent sale of medical device maker
Accuri Cytometers. (The transaction price was not disclosed.)
Each could have retreated to a private island and never worked again. Or, at the very least, picked up stakes and moved to the coasts. Instead, both are re-investors in Michigan, creating new companies and jobs, voting for the state's future economy with their time, dollars, and know-how.
Newton is once again the head of
Esperion, having bought back his company from Pfizer for $22.8 million in 2008. Last September, Baird became CEO of her latest venture,
Accio Energy, a pioneering wind-energy company.
Newton notes they're not alone in choosing to remain in Michigan. Since he founded the first Esperion in 1998, local entrepreneurship has changed dramatically, especially in the life sciences sector. "Pfizer's closing was very difficult, but the people who stayed here are true entrepreneurs," he says. "They've started companies in biotech, pharma research, and more."
Academic and corporate collaboration has improved. New government and nonprofit agencies are creating a strong support network for entrepreneurs - groups such as Ann Arbor SPARK, Michigan Economic Development Corporation, Southwest Michigan First, MichBio and the Michigan Venture
Capital Association, he says. Newton's a fan of Michael Finney, former CEO of Ann Arbor Spark and newly appointed head of the MEDC, and of Governor Rick Snyder - although he disagrees with Snyder's education budget proposals.
"The governor believes in entrepreneurship. Avalon Investment was the only Michigan-based VC money that came into the first Esperion," Newton says. Avalon Investments Inc. is an Ann Arbor venture capital fund developed by Snyder before he entered the public sector.
"I wouldn't have stayed in Michigan if I didn't think there's a bright future here," Newton claims. "That's why I worked so hard with business leaders to insure the availability of the state-of-the-art facility now called the
Michigan Life Science Innovation Center (in Plymouth Township.) It's 95% full with 19 companies there."
But Michigan lacks a high profile and positive image outside of the state, he observes. "When I restarted Esperion in 2008, Pfizer obviously didn't see what I saw - the talent and technology that are here," Newton says.
Newton says he'd love to go on a sabbatical at Esperion, working at the bench for six months. Unfortunately, as CEO and chief science officer, he rarely, if ever, puts in time in the lab. Earlier in his scientific career, he co-discovered
Lipitor, the world's most-prescribed cholesterol-lowering drug.
Esperion II is taking a compound discovered by Esperion I to treat patients with high LDL cholesterol and normal or elevated triglycerides. Eventually it may be used to treat pre-diabetic and diabetic patients. The new drug may regulate imbalances in fat, lipid, carbohydrate and glucose metabolism.
Entrepreneurs should not limit themselves by looking for funding only in Michigan, Newton cautions.
"Look to New York City, Boston, North Carolina, Seattle, San Francisco, both coasts. I'm not saying don't look in the Midwest for venture capital. There's plenty here. If you have capital, you have the opportunity to see the potential of your technology," he says.
Newton's advice for entrepreneurs:
- Don't be afraid to consolidate - the key is getting your technology commercialized. If there's complementary technology, don't be afraid to merge.
- Be wary of venture capitalists not giving a fair percentage of equity. The people in the trenches create the value.
For all the people who've had success in Ann Arbor and Michigan, he has a challenge: don't be afraid to reinvest. Look at another opportunity in the state. Build on your success.
Here, there, then back againThat's the approach Jennifer Baird is taking. She knew she wanted to be a CEO in high school. She confirmed that ambition during a college internship with Ann Arbor venture capitalist Mary Campbell, who now chairs the board of Accio Energy.
Baird is working once more with some of the same investors who funded Accuri. "There was a good outcome for angel investors in Accuri. They're now investing in Accio. We have a personal relationship and they're also interested in the space," she says.
Accio is fundraising from angel investors, whose stakes range from $25,000 to $250,000. More than $1 million has been raised in the current round. The company previously secured $2 million in investments and contracts since its founding in 2007.
Are potential investors spooked by the complex technology of Accio's turbine-free renewable wind energy generation? "People understand what you're going to do with energy but not how you do it, even people who are pretty technical. In Accio's case, we are inventing new wind technology that doesn't exist. Accuri improved on existing technology," she says.
Baird, a Michigan native, returned to the state after 12 years in Chicago for both personal and professional reasons, following work in financial services and management consulting. "I have roots in the state: parents, children in school, my husband is a teacher and a coach,” she explains. “It's a nice environment with a low cost of living. You can get anywhere in Ann Arbor in 15 minutes."
She found that Michigan's entrepreneurial environment had blossomed in her absence. "New generations of executives are learning the process, which is very one-on-one. The entrepreneurial environment is much like a garden," she says. "Not everybody likes the uncertainty and the fog. I like it - I'm very comfortable with the risk and uncertainty."
Would-be entrepreneurs should test themselves by working for small companies that have taken some steps down the road to success. Really new start-ups aren't good for people right out of school, she cautions. People don't come out of school ready to be in business.
Her advice: Work with people who have high integrity, who are building a quality organization. You'll be able to test your skills. They're looking for people to step up and take responsibility. As part of an organization, you'll be able to build credibility and get experience raising money, hiring people and
running a business.
"In a small company, you really get to know the people. You see them daily. There's raw creativity. Things are very clear in small companies," she says.
For those who have already succeeded and have the payout to prove it, she says, "Take the money from the payout and reinvest it in the community."
Baird heard one question over and over after the Accuri sales announcement: "Are you going to quit?"
"Why would I quit? I always like doing a new thing. Without new problems to solve, I get bored easily. I would estimate my lifespan at a company at around five years. It takes that much time to build a lot of value," she says.
"Michigan's talent bench has been growing. At Accuri, I recruited a number of executives and I think they're still here. We have got (talented) people in this state. I don't see any reason to go anywhere else to build a company."
Constance Crump is Concentrate's senior writer. She's also an Ann Arbor-based writer whose
work has
appeared in Crain's
Detroit Business, The Ann Arbor News, The Detroit Free Press, and Billboard Magazine. Her previous article was Networking 2.0 in Ann ArborAll photos by Doug Coombe