The path to Austin’s economic future
About the Crow's Nest
"My grandfather Bob McCracken began writing the Crow's Nest in 1935. He was 25 years old.
"After a judge threw my grandfather in jail in 1945 for writing a Crow's Nest column criticizing the judge's conduct in a trial, my grandfather and the paper appealed all the way to the Supreme Court - and won. (Read More »)
We know how to make Austin a leader in clean energy and biotech. After all, we created the model.
The road to Ensenada requires a job.
In the spring of my senior year in college, I told my parents that I was going to graduate without a job, spend three months surfing in Ensenada, Mexico with my college roommates and write a novel.
My dad had to be revived with smelling salts.
My mom handled the situation with greater subtlety. She understood idealism and the lure of an exciting vision. After graduating from the University of Oklahoma, she had been a young journalist in New York City in the 1960’s.
But she had also grown up in Anadarko, Oklahoma. Her mother was Caddo County’s postmaster, and her father had fought in two wars by her 13th birthday. Her experiences growing up in small town Oklahoma had made her practical – particularly with finances.
My mom told me that my “plan” sounded great. Then she asked me calmly how I intended to pay for it. That prompted my first trip to Career Services.
The roadmap to the future
How can Austin lead in clean energy and biotech just as we have led in semiconductors and software for a generation?
There is an existing, proven model for how a city can make itself the home to researching and developing key technological breakthroughs for an industry while creating good jobs and broad-based opportunity in the process. That model was created in… Austin.
In fact, this model is so influential that in national economic development circles it has a name: “The Austin Model.”
Here is how the Austin Model went from a promising vision to a practical plan that produced results.
It started with George Koztmetsky, the late Dean of UT’s Business School. To become a leader in the technology sectors of the future, Dr. Kozmetsky said, a community needed to link (1) public and private initiatives with (2) technology commercialization strategies. Even more importantly, he wrote, to make this vision into reality, a community needs leadership.
Dr. Kozmetsky gave his vision a name: the Technopolis. Then he set out to make this vision a reality in Austin.
Dr. Kozmetsky established a technology partnership between the City of Austin, the University of Texas and the Greater Austin Chamber. He brought together these partners to create the Austin Technology Incubator, which commercializes university research into dynamic technology companies.
More significantly, it was his vision of the Technopolis that became the foundation in Austin’s bids for MCC and SEMATECH. A generation ago, Kozmetsky and a group of visionary Austin leaders implemented this vision to catapult a mid-sized university town into a major technology leader and a global center for semiconductor research, development and manufacturing. These leaders achieved this remarkable success during a five-year period between 1983 and 1988.
During that period, Austin twice competed for major national technology consortia – MCC and SEMATECH – and won both times. Austin’s victories were so improbable, and our city’s strategy so unconventional, that other cities hired consultants for years afterward to understand how we had done it.
How we can lead again
Now, the Austin region looks to how we can lead in clean energy and biotech/life sciences. We can draw lessons from the vision we created here in Austin.
It is a vision that starts with a partnership between the City of Austin, the University of Texas, the State of Texas and the Greater Austin Chamber to create the foundation for an innovation economy. It is a vision also built on the successes of Stanford’s and MIT’s technology commercialization programs.
Here are seven specific elements of Kozmetsky’s Austin Model that Austin used for MCC and SEMATECH – and that we can use again to lead in clean energy and biotech/life sciences:
- Create infrastructure for innovation – such as research and development labs and research parks. Successful models include SEMATECH, Stanford Research Park and the National Renewable Energy Lab (NREL). The Texas Clean Energy Park and the envisioned TxAN State Lab should be at the core of creating this vision.
- Commercialize university technology. This starts with expanding the technology commercialization partnership between the University of Texas and the City of Austin through the Austin Technology Incubator (ATI). ATI converts cutting edge U.T. research into innovative Austin-based companies. In his book Academic Entrepreneurship, Scott Shane writes that nationally, this has proved to be a particularly effective strategy for catalyzing new companies in biotech and life sciences. The new Bioscience Incubator jointly created by U.T. and the City of Austin already has five innovative companies. Austin and UT have also created dynamic clean energy companies at the incubator such as ActaCell, Atonometrics and Solar Array Ventures.
- Create research and development consortia. By bringing together the nation’s public and private sectors leaders in a SEMATECH-scale initiative, we can take on clean energy’s and medicine’s toughest challenges. This is what Austin and the Environmental Defense Fund are currently doing through the Pecan Street Project. (I will write about the Pecan Street Project in my next Crow’s Nest.) Bringing a medical school to Austin is likely a critical prerequisite for pursuing such a strategy eventually in biotech/life sciences.
- Recruit new companies and retain existing companies. Dr. Kozmetsky wrote that this was a key element to building a technology cluster. Paul Krugman recently won a Nobel Price in Economics for his research demonstrating how regions have established economic success through recruiting and retaining companies and providing targeted incentives– particularly for manufacturing companies. Scott Shane writes that a local manufacturing base is a critical element in creating a successful technology cluster. During an economic recruitment trip to Silicon Valley in July, I personally observed how important Austin’s recruitment of Samsung’s new 300 mm fab has been to attracting additional semiconductor companies and talent to Austin.
- Build a local market. Economist Jon Hockenyos observes that creating a local market is increasingly important to building a successful economic sector. This is particularly true in clean energy, where cities, states and public utilities can promote job creation through purchases of solar, wind and energy storage. Governor Bill Richardson has catapulted New Mexico into a national solar energy leader by aggressively implementing such a strategy.
- Empower people to achieve opportunity through job training - just as Austin did in the SEMATECH era with the Austin Project and that Temple, TX is doing now in biotech. Such initiatives are critical to ensuring that the entire community shares in the opportunities we work together to create and that we have a workforce with the training to work in these emerging sectors.
- Practice unity and “intense cooperation.” Unity was a key factor in Austin winning MCC and SEMATECH against far more established rivals. The city’s business, university and political leadership pulled together in a display of “intense cooperation” (as a University of Texas analysis later described it). A researcher hired by Philadelphia to study Austin’s high tech success concluded that Austin was able to “offer MCC what none of the more established tech capitals could match. To wit: a whole community—economic, intellectual, and political—that would shape itself to support MCC and its industry.”
It was one of Austin’s finest hours. By working together, we achieved things as a community that made us a model for the country - and created opportunity locally for a generation.
By rekindling Austin’s legendary cooperation and community-wide sense of mission, we can lead again in the innovation sectors of the future.
A personal note
I got married this past weekend.
For those of you who don’t already know her, my bride’s name is Sarah Groos McCracken. We married in San Antonio, where Sarah grew up. My son Ford was my ring man. He wore his first suit, and he even picked out his own clip-on tie.
Sarah is the Programs Manager at the LBJ Library. I met her last year when my friend Catherine Robb asked me to come to a meeting at the library.
As Sarah and I got to know each other, we found out we had a lot in common. Her grandfather was the head pastor of the Corpus Christi church I grew up in, and her mother graduated from the same high school I did (they lived next door to Farrah Fawcett on Floyd Street). Her father graduated from the same college I did. Sarah and I both studied in Spain during college, we both lived in Washington, DC after college (she worked at the Corcoran Art Gallery), and we both are avid readers.
Sarah doesn’t really like politics, so I’ve had to promise her that I will never ask her to give a speech. We both like hiking and the outdoors. She indulges my guitar practicing, and she shows great grace as she regularly beats me at Boggle.
Most of all, Sarah has strengthened me in my own faith. I love her deeply and completely.
As you read this, Sarah and I are on our honeymoon in Zihuatanejo, on the Pacific coast of Mexico. The area has a reputation for great waves.
In the years after college, I did write a novel, just as I had envisioned. I wrote it one hour at a time, early each morning. It took me three years to finish it. It was the hardest thing I’ve ever done.
Now, I will get the chance to surf in Mexico. And no offense to my college roommates, but I am glad that I waited to make the trip with Sarah.
Download a printable version of this week’s Crow’s Nest (pdf file).
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