UB Insider #4 – Entrepreneurship & Economic Diversity in Utah
About this episode:
At the 10th annual Utah Economic Summit Friday, Utah Business’ Lisa Christensen spoke with Pierre Lassonde, founder and chair of Franco-Nevada Corporation and founder of the Lassonde Entrepreneur Institute at the University of Utah, about the state of entrepreneurship and what it means for the state.
Christensen also spoke with Governor Gary Herbert about what draws people to the state, the economic diversity there, why the economy is so strong and what his goals are for the future of Utah. You can subscribe to UB Insider and download this episode on Stitcher or iTunes.
Lisa Christensen: Hello and welcome to UB Insider. I am Lisa Christensen, online editor at Utah Business magazine and today we covered the 10th annual Utah Economic Summit. The keynote speaker for the summit was Pierre Lassonde, founder and chair of the Franco Nevada Corporation and founder of the Lassonde Entrepreneur Institute at the University of Utah. We were able to talk to him for a few minutes after his speech about the institute and the state of entrepreneurship in Utah and at the U. You will have to forgive the recording quality, there were a lot of enthusiastic attendees at the summit.
Pierre Lassonde: The power of the entrepreneurship program at the University of Utah has demonstrated that out of the research going on at the University, we can develop, and out of the human imagination that all of our students have, that we can develop an ecosystem of entrepreneur that will end up creating and that has already created tens of thousands of jobs here in the valley, therefore making Utah one of the prime states where people want to live because you’ve got a great environment. You’ve got jobs, and well-paying jobs because they are in the high technology industry.
Lisa Christensen: Lassonde got his MBA at the U while his late wife, Claudette MacKay-Lassonde studied nuclear engineering. And when they discussed how they wanted to give back to their alma mater, they decided they wanted to help support the parts of their educational experience they found vital in their careers, and tried to create things that they wish they had when they were going to school.
Pierre Lassonde: I owe where I am today to the University of Utah. I earned my MBA here. And what I’ve learned here has served me my whole life. So, it was a matter, for me, you know, how do we give back? And our student experience here was so tremendous, that we wanted, my wife and I, to recreate that experience for the students of today and then give them something more. Give them something that we would have wanted if we’d been there in terms of entrepreneurship. And that’s why we now have created the Lassonde Studios, where, you know, this is going to be an unbelievable facility, unique in the United States. There’s no other university that will have anything like it. It’s because of the support of the president of the university.
We’ve been able to cut across and create something that is unique where 400 students from all faculties are welcome and will be able to live, breathe and work and create their own companies and help others create their companies. They will be able to work in the cafes there, run a food stand, run the building so that when they come out they don’t just have a theoretical knowledge of what to do. They have a practical knowledge. They can start their own coffee shop. They can start their own business. They will have had the finance course, they will have had all the courses required. But beyond that, they will have lived it.
Lisa Christensen: Beyond helping create a place where students can get that hands on experience, Lassonde says he thinks fostering that sense of entrepreneurship is vital as an economic driver for the state and country.
Pierre Lassonde: If you look at the jobs of the future, it’s all out of entrepreneurship. It’s all out of the new economy. You know, a lot of kids today enter university and they will tell you, the job that I want doesn’t exist today. So I will have to create my job. And that is what we’re doing at the Lassonde Institute. We are creating the jobs of the future. Because the old economy, slowly, if you look at manufacturing, it’s dwindling. If you look at even servicing, the whole service industry is morphing into high technology – Uber, B2B – you know, you go on, it will displace the old economy. So that new economy, we’re there to create it. And we’re there to create the jobs that will go along with it.
Lisa Christensen: While not everyone dreams of starting their own business, Lassonde says helping those who do will help create more and better jobs for those who aren’t so inclined.
Pierre Lassonde: Not everybody will be an entrepreneur. But if you have an entrepreneur who can create a company with 10,000 jobs, that is what you want. You want a whole bunch of unicorns, you know, like billion dollar, ten billion dollar companies that will create 5, 10,000 jobs in the valley and those jobs will be well paid jobs in a great environment. That’s what you want.
Lisa Christensen: In the early days of the Lassonde Institute, no one, Lassonde included, had any idea of how successful it would become, or how successful the students coming out of it would be. And the future is bright.
Pierre Lassonde: Everybody thinks that when you have achieved a certain amount of success, that you knew exactly where you were going to go in the beginning. That is not the case. At Franco Nevada, my company, did I know that we were going to build a 10 billion dollar company? Not a chance. We started with 2 million dollars. Ok. Our dream was like, if we could be a hundred million, we will have achieved really something. Ok. It’s the same thing here.
We started very very small with the idea to have an impact on the students, to get them real practical experience, get them some real training so that when they come out they have a skill that maybe no other students have. And then over the years we’ve learned that there’s such incredible intellectual properties at university, well how can we better the commercialization of it. So, it came by little by little by little. Today, of course, it’s a huge success. I’m so proud of it. I’m so proud of our students I’m so proud of what they’ve created. And I can see the future now. It’s just going to get better and better.
Lisa Christensen: We also got a chance to talk with Governor Gary Herbert about the increasing attention Utah is getting nationally and internationally. While most of the recognition has been for the state’s economy, the scenery and recreation are nothing to take for granted either.
Governor Gary Herbert: Fodor’s Travel, an international publication named the state of Utah, the entire state of Utah as the number one travel destination in the world for 2016. What it means is that they can’t just focus on one thing. There are so many good things in Utah whether it’s the skiing, outdoor recreation, our national parks, our 43 state parks, all of the things that go into making this a great place to come and visit, they’re saying we can’t just isolate on one, it’s got to be the entire state of Utah that you need to go visit. That’s never happened before. It just shows that we’ve got a wonderful state, great vistas and venues, wonderful people, and that’s a publication saying go to the entire state of Utah. That’s the one thing to do in 2016. We have great vistas and venues throughout the state. We have great outdoor recreation. It could be just fishing, it could be boating, kayaking, our snow skiing, everybody knows about our skiing, it’s the greatest snow on earth. But it’s golf, it’s everything in between. We just have a great place to come and recreate and come to visit. It’s beautiful and guess what? The people are just as beautiful.
Lisa Christensen: Governor Herbert’s remarks at the summit were largely about his goals for the future of the state and maintaining the economic strength that Utah has proven itself to have.
Governor Gary Herbert: It’s allowing us to build upon what we’ve done in the past to get us to be on top. These are the principles that will help us stay on top: Expanding business opportunities, continuing to partner in even more innovative ways. Innovation is the key of our summit today. So we want people to be able to think outside the box and innovate. How they associate with government, what can we do, mostly, to kind of get it out of the way sometimes and letting them do their own thing. But all those things of working together and collaboration, cooperation and innovation that makes Utah such an extremely successful business state.
Grown support means that we’re going to continue to grow our businesses inside and support their efforts. Again, we want to be the center spot for entrepreneurial spirits, the epicenter for small business growth and creation. And before you’re a big business, you’re usually a small business. We’re trying to grow and support our businesses here. We’re engaging in the industry. We want people to engage more and more in relationships so we understand what we’re supposed to be doing and make sure that we build on the strategies that have made us successful in the past. Expand the experience talks about our tourism aspect. It’s not just business, but where we’re having people learn about Utah is tourism and travel. And so that’s an area sector that is really growing rapidly.
We’ve gone from a 5.2 billion dollar industry in the last five years to now where we’re at about 8 billion dollars. And we produce about 1.1 billion dollars in taxes, state and local. So it helps keeps the taxes for the Utahans down by expanding our tourism and travel business. And advanced partnerships mean that we need to, in fact, work together. We’ve talked about having unprecedented partnerships that can give us unlimited possibilities of success. And we see that happening, so we’re going to build upon that going forward. So, we’ve got us on top, and now we want to stay on top.
Lisa Christensen: He also pointed out that one of the reasons Utah’s economy is so strong and has weathered economic ups and downs so well is because it doesn’t rely on any one industry. The state is third in the nation for economic diversity.
Governor Gary Herbert: A lot of states have struggled because they were so uniquely one sector and nothing more. Look at energy, North Dakota, great performing economy while the energy was producing, but now with the drop in oil prices they are about a billion dollars upside down on their budget. Oklahoma, about a billion dollars, Alaska 1.7 billion, Texas is struggling. The fact that they’re so reliant on one sector of the economy. We, on the other hand, have diversified. So we are now the third most diversified economy in America. So we don’t have all of our economic eggs in one basket, so if one sector is down, other sectors are up. Thus despite the drop in our mining and our energy and natural resource development, we still have 3.5% unemployment and a job growth creation rate of 3.3%. It’s double the national average! So that diversification is helpful to keep the level economic growth and expansion and bodes well for the future.
Lisa Christensen: And because that strong economic framework has been built, he said, all that’s left to do is help businesses grow within it.
Governor Gary Herbert: All of our sectors in Utah are growing again, but right now energy is down a bit from what it’s been due to the drop in oil prices, but every other sector is growing quite dramatically. So we believe in the free market, so we want to make sure we have a fertile environment, a fertile field where the entrepreneur can drop their business seeds in the soil and grow. So whatever they are, we want them to have a great success of growing here and developing and expanding economically. It’s not a matter of picking one sector over another sector. We have about seven great sectors growing now. But we want anybody and everybody, if you want to come to a very business friendly state and drop your entrepreneurial seeds in the most fertile soil in America today, it’s Utah.
Lisa Christensen: You can find more coverage of the Economic Summit at our website, UtahBusiness.com and be sure to check out our Facebook, Twitter and Instagram pages for all the latest in Utah’s business news. By the way, you can now download our podcast on iTunes and Stitcher. Thanks for listening and we’ll be back next week.