Attention Georgia Leaders: It’s Time for Gazelles
By April 29, Georgia’s elected leadership will have completed a budget that cuts hundreds of millions of dollars from the state’s budget. Hard choices have been made, and more decisions loom in these final days of the legislative session.
Historically, Georgia has worked hard to create a positive business environment. This has been a critical element of our success in luring top companies to the state. But it is becoming increasingly apparent to futurists, economists and others that the needs of existing business must be balanced with strategies for nurturing promising new enterprises.
According to the Kauffman Foundation, which specializes in promoting innovation in America, virtually all net new jobs in the U.S. since 1980 were created by firms that were five years old or less. Even more importantly, the fastest growing one percent of these young companies generate approximately 10 percent of new jobs in any given year. These companies – sometimes called gazelles – contribute an average of 88 jobs per year, and most end up with between 20 and 249 employees.
What can we do to establish a herd of gazelles in Georgia? We must continue to invest in innovation. It is the innovators who build new economies and improve the way we live, the way we do business, and the way our state is perceived. In Georgia, these are companies like Suniva, Internet Security Systems, CardioMEMS, MedShape Solutions, Damballa and Senstrinsic. Not all of these names are widely recognized yet, but they represent the future Microsofts and Genentechs.
Many of these “gazelle” companies and their leaders emerge from research universities. Apple, Hewlett-Packard, Google and many other companies that have reinvented American business emerged as a result of work by university researchers. Understanding this potential, Georgia has invested enormous time, energy and capital over the past 20 years to establish a group of six nationally-recognized research universities, all of which are members of the GRA. The results have been impressive: Investments in GRA have brought more than $2.6 billion in new federal and private funding to Georgia. In 2009 alone, GRA Eminent Scholars – high profile researchers recruited to the state by the GRA – generated over $200 million in non-state funding to pursue their discoveries. More than 5,500 jobs have been created through GRA and 175 new companies can trace their origins to university inventions fostered by GRA investments. Research and our own experience show that creating an environment attractive to entrepreneurs and researchers is the fastest way to grow quality jobs in Georgia, but aggressive cuts in higher education and research threaten our progress and our national reputation.
Our legislators have tough decisions to make in the days ahead. One critical decision is how to grow and nurture Georgia’s gazelles.
C. Michael Cassidy
President and CEO
Georgia Research Alliance
First published in Insider Advantage, April 22, 2010
Entry filed under: Commentary.