Op Ed

Could Wisconsin Boom Like Seattle?

WARF leader, former Seattle resident, offers road map to get us there.

By - Jul 8th, 2017 10:07 am
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Seattle. Photo taken August 6th, 2014 by Jeramey Jannene.

Seattle. Photo taken August 6th, 2014 by Jeramey Jannene.

Erik Iverson sees Wisconsin poised for the same kind of boom that Seattle experienced in the late 1980s and early 1990s.

He is the new managing director of the WARF (Wisconsin Alumni Research Foundation), a position he took over about a year ago after five years running the Infectious Disease Research Institute In Seattle and 7 1/2 years heading the Bill and Melinda Gates Foundation in Seattle.

As he drove from Madison to Milwaukee on I-94 to speak to the Wisconsin Venture Capital Association (WVCA), he wondered why the grassy median had not given way to a rail line with trains whizzing back and forth between the two cities. That is the kind of convenience and infrastructure that Seattle added to accommodate a burgeoning work force.

The new headquarters of Amazon under construction on the edge of the South Lake Union in downtown Seattle (the current headquarters are a short streetcar ride away). Photo taken August 6th, 2014 by Jeramey Jannene.

The new headquarters of Amazon under construction on the edge of the South Lake Union in downtown Seattle (the current headquarters are a short streetcar ride away). Photo taken August 6th, 2014 by Jeramey Jannene.

The Seattle boom, propelled by the likes of Microsoft, Amazon and Facebook, saw explosive growth. It continued into 2017 with 68 major building projects under way.

Seeing the foundation for a similar technology-based expansion in Wisconsin, Iverson urged the Wisconsin startup leaders to stay ahead of the looming needs for millennial workers. Plan ahead, he said, for light rail and affordable housing.

Iverson opined Seattle had “lost its soul” as the boom drove prices for modest homes to $700,000 to $800,000, caused maddening traffic congestion, squeezed the arts community out of it traditional spaces and lessened the city’s diversity.

“It’s incumbent on us to keep our soul” as growth accelerates, he said. “Let’s get ahead of it.”

One seasoned business man said Iverson’s vision had swung him from negative to positive on the debate over rail infrastructure Wisconsin. Seattle’s light rail cars are jammed.

Iverson’s bullish optimism for Wisconsin, not just Madison, served as a tonic for the band of venture capitalists who have been working hard for several decades to rev up the startup ecosystem across the state. The startup dynamics have improved sharply here over the last 15 years. For instance, venture capital investments are double what they were five years ago. The state is now dotted with incubators, accelerators, mentors and entrepreneurship education programs.

The Seattle Monorail, with the more pedestrian and automobile friendly South Lake Union Streetcar. Photo by Jeramey Jannene.

The Seattle Monorail, with the more pedestrian and automobile friendly South Lake Union Streetcar. Photo by Jeramey Jannene.

But veteran venture investors in Wisconsin see the need for lots more capital to meet the demand brought by a growing base of entrepreneurs. Joe Hill, who is retiring in the fall as the head of the technology transfer office at the Medical College of Wisconsin, said his team has to raise money outside the state for long-term biotechnology deals like drug development.

And there is near unanimous agreement that there is an urgent need for expansion capital for young firms. They are in what’s called “the valley of death.” Unable to get bank loans or Venture A Round money, they often go back to their angel investors and ask them to double down.

Iverson made it clear that WARF is ready to lead the way out of that valley and in other dimensions of startup investing.

Among the concepts he floated at the WVCA meeting were:

  • WARF loan guarantees to stimulate banks to lend to startups that are taking off.
  • Non-dilutive grants to mature technology projects with the aim of spinning them into the commercial world.
  • Direct investments alongside venture funds that take the lead. He has created a new $10 million seed fund that can fly syndicated or solo on investments of $25.000 to $150,000. And a venture fund of $50 million for syndications.
  • Creation of a new position of Chief Venture Officer.

Iverson is clearly a man on a mission. Other indications that he will lead boldly across the state:

  • “I want to de-risk technologies for you.”
  • “I want (WARF) to go far.”
  • “Let’s keep this dialog (with investors) going and match up opportunities.”
  • Wisconsin has “a ways to go” on a risk-taking culture. “It’s something we have to embrace.”
  • “It is critical to have our policy makers on board.”
  • It’s an essential condition that there is “a collective sense of giving back time, talent and treasure.”

A common denominator in Iverson’s message is the need for collaboration, including relationships with the technology transfer offices at MCW, Marquette and the University of Wisconsin – Milwaukee. He is engaging technology movers and shakers at UW –- Madison, his main mission, but also across the state.

He promises to match their efforts by “moving at WARF speed.”

John Torinus is the chairman of Serigraph Inc. and a former Milwaukee Sentinel business editor who blogs regularly at johntorinus.com.

Categories: Business, Education, Op-Ed

29 thoughts on “Op Ed: Could Wisconsin Boom Like Seattle?”

  1. Jake formerly of the LP says:

    Gotta have a state government that wants to invest in education and a progressive way of life for the talent to want to locate/stay in Wisconsin. And you need that same government to recognize that the state’s biggest city (Milwaukee) and academic center (Madison) aren’t places to demonize as a way to get political advantage from playing off the resentments of low-educated rubes in the rest of the state.

    And since the state’s business climate is ruled by mediocre oligarchs like John Torinus would rather have high status than truly excel, Wisconsin will never be competitive with places like Seattle until we remove the current regressive wrecking crew that’s running things into the ground at the Capitol. And even then, it’ll take years to undo the damage that the 2010s Wisconsin GOP has done to our infrastructure, educational system, and national reputation.

  2. WashCoRepub says:

    Great column. I too share this optimism, especially since we now have leadership in state government that knows how to support and encourage business development, rather than seeing it as just something to tax. With tax hikes (personal and corporate) out of control in our neighbor Illinois and no end in sight, the opportunity is going to be there to poach businesses from that state as well.

  3. Joe R says:

    WashCoRepub touts “leadership in state government that knows how to support and encourage business development.” If that’s so, why is it that those wise and savvy GOP/WMC leaders never — ever — mention or acknowledge the greatest economic success story in this state in the last 35 years?

    That would be Epic Systems in Verona/Madison, which employs more than 9,000 people, not to mention hundreds more working for spin-off consulting businesses. Epic is the type of high-tech business that any state would covet. Our “leadership in state government” should shout Epic’s praises whenever they pursue economic development, but, alas, they don’t. You see, Epic founder Judith Faulkner donates to Democrats, and she told WMC to piss off. So to the GOP, for whom political power is paramount, Epic is a pariah. It doesn’t even exist.

  4. Jake formerly of the LP says:

    Precisely Joe. Add in New Glarus Brewing, whose owners are also outspoken Democrats.

    Of course Judy Faulkner and Deb Carey aren’t ever going to be members of the old boy’s club at WMC, the MMAC and other businessMAN organizations that call the shots for GOP-puppet politicians.

    Heck, Madison is far and away the state’s economic leader for the last decade, but God Forbid the regressive GOP follow the lead of us over-ejukayted hippies.

  5. Tom D says:

    Running trains up the I-94 median is a terrible idea for at least 4 reasons:

    • Highway lane shifts to the other roadway (eg for bridge work) are impossible if there is an active railroad in the median.

    • Medians aren’t just wasted space; they are buffers for out-of-control vehicles. Today, if a car skids off the road into the median, people are seldom injured; if there were a railroad in that median, fatalities would be likely.

    • Road salt and railroads don’t mix. Salt would find its way onto the nearby tracks and short out signals. (Salt water conducts electricity much better than fresh.) Salt would also prematurely rust out the steel rails.

    • Stations in a median are problematic. While it’s possible to put train stations in a highway median (e.g. the CTA Blue Line on Chicago’s I-90), those stations are quite unpleasant. On I-94, any such stations would be accessible only by car as there is nothing within walking distance of I-94 west of Waukesha. By contrast, the Madison train Walker opposed would have had stations inside downtown Watertown and Oconomowoc.

  6. Jason Troll says:

    Joe R, when will Judith Faulkner start paying state and federal income taxes. You know her fair share. It must be nice to be a Billionaire and be protected by Democrats.

  7. Jack says:

    What? You think you’re going to land something as big as Boeing in Wisconsin. Someone should tell John Iverson just WHY there aren’t trains buzzing between Madison and Milwaukee and he’ll soon begin to realize why Wisconsin will never, ever have the economic clout of a state like Washington. If Scott Walker and his pack of Republican dunces who have ruled the entire state government for most of six or seven years haven’t much of anything to show for it, where does Iverson see greatness on a scale with Washington on the horizon? Especially with Scott and his underachievers who have damaged Wisconsin’s economic infrastructure for many years to come. So Epic employs about 9,000 people? Well Boeing employs nearly 150,000 people, the size of some entire cities here. Come on, folks.

  8. tom says:

    Lying Scott Walker is still trying to reach his first term promise of 250,000 new jobs. He’s three years behind and still has a long way to go. Wisconsin lost manufacturing jobs under Walker last year. The ideologues in state government will steal from education, force families into the streets, squelch any talk of high speed rail or infrastructure to feed its base. Walker and Fitzgerald do not really care about the future of Wisconsin. They care only in the plight of their donors and their own political futures.

  9. Joe R says:

    Jason T – Instead of addressing my point (the great and powerful business-creating GOP shamans in Madison ignore the biggest business success in Wisconsin because the company has librul politics), you take a pot shot at Judith Faulkner. I’ve seen you do better than that. And the bit about progressive income taxation was snark, right? I’m not sure Diane Hendricks gets the joke.

  10. tom says:

    P.S.
    If you want something done in Wisconsin show Scott Walker the money. Its all pay for play now.

  11. JasonTroll says:

    Tom Barrett got his trolley watch out Amazon and Microsoft. Tom Barrett announces delivery of Amazon packages to residence along trolley line. Amazon contracted employees will be paid in Barrett bucks currency used along trolley route.

  12. Jake formerly of the LP says:

    tom- Well stated. There is no economic strategy from WisGOP that goes beyond “eff you, pay me!”

    If you pay them, they pay you back (voucher schools, WEDC, Vos with the Road Builders). If not, then they don’t, and if you do things they don’t like, they try to defund you and politically injure you (public schools, UW, unionized workers, high-speed rail).

  13. JasonTroll says:

    Jake you must be confused with Governor Jim Doyle and his sweet heart deal with the Indian casinos for dark money or Tom Barrett with his pay off of Rick Barret for the new Coulture building.

  14. Jake formerly of the LP says:

    Jason- You got nothing, do ya? And Doyle’s Wisconsin in 2010 was adding jobs at a rate twice as fast as we did in 2016, and we had fully paid-for high speed rail on the way, instead of pleading with Trump for a $341 million bailout to fix our highways.

    Stop being a Lonesome Loser with a dead-end life, and OWN THE WISGOP FAILURE. Get some pride, little guy.

  15. Vincent Hanna says:

    Troll are you that blindly partisan? You really only see one party making sweetheart deals or benefiting from dark money? I mean an entire book called Dark Money was written about the topic and it covers both parties.

  16. JasonTroll says:

    When do we actual start to tax wealth ? The left cries of wealth being placed in to few hands but does nothing about. Take what is rightfully yours. Lock them up and drive them across the world.

  17. Mr Scruff says:

    Trains are not the future.

    Autonomous vehicles that use roads is the future. They will be able to ride virtually bumper to bumper at high speeds.

  18. Vincent Hanna says:

    That comment is pretty indecipherable Troll. Most liberals do want to raise taxes on the rich. Many conservatives do too (just not those who hold elected office).

    Autonomous vehicles are not the future because of their prohibitive cost.

  19. Tom D says:

    Mr Scruff, if autonomous cars travel “bumper-to-bumper at high speeds”, what happens if one has a blowout??

    Autonomous cars will reduce automobile ownership and increase the use of transit (including trains). Ironically, autonomous cars will actually reduce automobile travel and increase transit use.

    With autonomous cars, Uber and Lyft will become much cheaper than owning a car because their vehicles won’t sit idle (parked) 95% of the time and because they will be able to use smaller, cheaper vehicles for most trips. If it is for only one person, you get a small one-seater; for two couples are traveling together, you’d get a sedan; to bring stuff home from IKEA, you’d request a small truck; if you are spending a weekend off-road at a cabin, you order 4WD.

    Not having a car allows homes to be bigger (no garages) and easier to maintain (no driveways to shovel), and eliminates time spent personally maintaining it (no trips to the car wash, inspection station, or Jiffy Lube).

    The Uber/Lyft app will also give you a choice between a private ride or a slightly slower—but substantially cheaper—shared ride (like carpooling where you don’t know your travel companions). Another option on the app will be to save even more money by accepting a two-seat ride (a short car trip to a station, then a bus or train to downtown). (Lyft is already experimenting with bus service in Chicago and San Francisco.)

    The future is rails not roads because railroads are MUCH cheaper than roads to build and maintain. Wisconsin is literally spending billions of dollars to rebuild 40 miles of I-94. The parallel Union Pacific railroad rebuilt 75 miles for a total $15 million (in 2010), and steel rails last longer than asphalt. Railroad cars last for decades compared to 10-15 years for highway vehicles (autonomous control won’t increase vehicle life at all). Highways (even with electric autonomous vehicles) still pollute (road salt) and overload sewer systems (stormwater runoff).

  20. Paddy M says:

    “As he drove from Madison to Milwaukee on I-94 to speak to the Wisconsin Venture Capital Association (WVCA), he wondered why the grassy median had not given way to a rail line with trains whizzing back and forth between the two cities. That is the kind of convenience and infrastructure that Seattle added to accommodate a burgeoning work force.”

    ya know – we did have $800 million to invest in WI to do just that. So sad Scott Walker was running for election. 100 WI companies would have benefited from this project. Sadly this is Walker’s modus operandi – attack anything and anyone to get elected.

    Vote Walker out and we can move forward. Enough of the nitrate filled sandwiches.

  21. Max says:

    Well John, first of all Seattle is a city in King County, the center of a sprawling dynamic economy and enviable environment in regard to education, living standards, opportunities for all. Wisconsin, aka, the PotHole State, is a state captured by the Koch Brothers and Tea Party types, where opportunities are stifled, corruption in state government is rampant, where natural resources such as water are there to be sold to and ravaged by the highest bidder, and in the vise grip of extremist governor who cares more about his political career than Wisconsinites, who saw to it the state was obscenely gerrymandered, and flaunts laws and common decency at a whim. On the other hand, Washington State has had Democratic governors since 1985, two female Democratic Senators, and a House delegation of six Democratics and four Republicans, who actually beat back the Tea Party, unlike Wisconsin where the Tea Party types are over-represented in the House delegation, but especially in State government, wherein nostaglia for the 15th Century abounds, the Enlightment is seen as the enemy, and the type of dynamic 21st Century to which you apparently subscribe is locked out. Change government is Wisconsin, restore voting rights to all, end the hideous gerrymandering, and Wisconsin may have a chance of succeeding.

  22. Curt Ed says:

    Most comments are accurate as to why Wisconsin will not be like Washington state and Milwaukee/Madison will not develop like Seattle. An additional reason is that now that Republicans have control of the state, they do not want Milwaukee or Madison to erode their power by being successful. Additionally, the current decision makers have no vision. They do not want to share power or money with people they may not know, and particularly with people who do not look like them. Their leader turned down $810 million dollars to protect the purity of that corridor, following the thinking that it would transport the wrong people for criminal purposes. And by the way, we have plenty of our own wealthy who don’t pay taxes, scrounge off of those who do, and buy elected officials when they end them.

  23. JPKMKE says:

    Could Wisconsin Boom Like Seattle? No, Wisconsin is a State. Why is Milwaukee not like Seattle? Milwaukee doesn’t have the volume of jobs, university graduates, and technical graduates that Seattle has. But Milwaukee could absolutely have a boom of its own kind. I disagree that we have not boomed on the scale of Seattle because of a lack of progressiveness. Seattle’s progressiveness did not bring Microsoft or the other software companies or Boeing to Seattle (when Boeing was headquartered there). Employers choose locations for 1) Cost; 2) Workforce. Everything else is subordinate to these two decision criteria or included within them. Transportation for distribution or supply is cost. Transportation of employees is Workforce. We need the workforce before employers would consider a trolley or a rail line as a factor in their decision.

  24. Vincent Hanna says:

    And what does that vital workforce want? Isn’t that relevant here? The workforce, particularly younger workers, want mass transit. They consider that when they choose where they live. Seattle has better mass transit than Milwaukee.

  25. Jason Troll says:

    Vince, ever here of Uber?

  26. Vincent Hanna says:

    You really have your finger on the pulse of those under 40 JT! Every single one wants to and can afford to take Uber everywhere! You can get back to telling those darn kids to get off your lawn now.

  27. walt stawicki says:

    Dear Jack Says: regarding your boeing figure. Is that include the east coast facilities too? It must! heres Wa contribution. I will spare the tax credits given but never clawed back, when they promised to stay. When the already had bags packed and at the depot to be taken out of state.

    Boeing’s Washington state workforce declined more than 2 percent last year, from 81,939 in 2013 to 80,199.(( https://www.bizjournals.com/seattle/news/2015/03/06/washington-state-loses-6-800-boeing-employees-in.html ))
    more recently its 70,000 STATEwide.

    And Max, who says the schools are so fine. We are running on empty to empty on that one last I read. Oh yes, a last minute “budget” that kept us out of the FINES ZONE! and last year a superintendant of schools who said he could just quit and we could close them if we were not willing to get stable funding. Yes, wonderful schools here. Not the public ones.

    I sure want to know where those green grassy rails are. The Everett to South commuter run is regularly out of commission, as regularly as the rain can wash some dirt over the tracks and it shuts for days as they investigate the mud patch. The in city rail is neat, but it takes longer to get to the airport now that the train succeeded in killing the EXPRESS bus, so passengers get to mix with south end shoppers. And neither the tunnel to the north , running under the ship cannal nor the one under Beacon hill has no lane provisions for a third lane as one might like for express through trains to farther places. Just started and already headed for traffic jams.

    Please learn our lessons.

    Now the CITY of Seattle wants an INCOME TAX of its very own. Problem with the constitution, but for a future like ours, I am sure the state will roll over.

  28. walt stawicki says:

    Dear Jack Says: reqarding your boeing figure. Is that include the east coast facilities too? It must! heres Wa contribution. I will spare the tax credits given but never clawed back, when they promised to stay. When the already had bags packed and at the depot to be taken out of state.

    Boeing’s Washington state workforce declined more than 2 percent last year, from 81,939 in 2013 to 80,199.(( https://www.bizjournals.com/seattle/news/2015/03/06/washington-state-loses-6-800-boeing-employees-in.html ))
    more recently its 70,000 STATEwide.

    And Max, who says the schools are so fine. We are running on empty to empty on that one last I read. Oh yes, a last minute “budget” that kept us out of the FINES ZONE! and last year a superintendant of schools who said he could just quit and we could close them if we were not willing to get stable funding. Yes, wonderful schools here. Not the public ones.

    I sure want to know where those green grassy rails are. The Everett to South commuter run is regularly out of commission, as regularly as the rain can wash some dirt over the tracks and it shuts for days as they investigate the mud patch. The in city rail is neat, but it takes longer to get to the airport now that the train succeeded in killing the EXPRESS bus, so passengers get to mix with south end shoppers. And neither the tunnel to the north , running under the ship cannal nor the one under Beacon hill has no lane provisions for a third lane as one might like for express through trains to farther places. Just started and already headed for traffic jams.

    Please learn our lessons.

  29. walt stawicki says:

    Here is you half million plus$$$ Seattle market today. Be careful what you wish for!

    http://www.king5.com/money/markets/real-estate/boarded-up-overgrown-seattle-house-on-market-for-nearly-half-a-million-dollars/450974790

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