The current Edward V. Fritzky Chair in Leadership, Ken Denman (MBA 1986), talks about his passion for leading edge technology, adapting to business cultures abroad and computers that can detect emotions.
You’ve led at a string of successful tech companies. How have you navigated your course?
Well, I got my MBA from the Foster School in 1986, and I know I should probably have a more quantitative answer at the ready. But the truth of it is that I followed my passion. I wanted to be in on developing and launching technologies that would impact the way we work, live and play. I thought, “I need proximity to those kinds of businesses, that’s where the opportunity lies.” It’s built in to all the old adages: Why do people rob banks? That’s were money’s kept. Or, Go West young man! Essentially, all of these sayings are about aligning with opportunity.
Can you talk about some of the plans you have as Fritzky Chair?
Absolutely—I want to make the Foster School an even hotter bed of innovation than it already is. I organized a conference that focused on innovation and entrepreneurship. One of the sessions was called “Social 2018” and the presenter was Harvard Business Press author Nilofer Merchant—called “the female James Bond of innovation.” It’s a great example of my vision, which is to change the way we think about opportunity. We all know that the social era has changed the business landscape, and many of the old rules no longer apply. But the impacts are only starting to be realized. Corporate behemoths no longer have the advantage. Smaller, focused teams that are nimble and can conceive of an idea, make a plan and launch it from various points across the world, hold the edge.
The more exposure Foster students and faculty have to the different pieces of the innovation engine, the more prepared the upcoming generation of business leaders will be.
You seem pretty bullish on innovation—is there a downside of being on the cutting edge?
Recently, I’ve been thinking about how the things I’ve been involved in for the past 15-20 years have created jobs, but also contributed to the loss of existing jobs. How do we create enough work in the US? We’re going to be deeply challenged in this regard—the political talk about bringing jobs back isn’t likely to work. The economics aren’t pragmatic, and the kinds of skills needed will be very different.
The need to reorient our economy and educational aspirations is paramount. We need more knowledge workers, yes, but we have to push certain kinds of vocational training. One kind of job is going away, but there are new jobs enabled by that very technology. For example, maybe we need fewer machinists now, but what about the programmers and technicians who enable the machines? We don’t need to push everyone toward college, but the newer paths aren’t as clearly defined.
You’re currently CEO of Machine Perception Technologies. Can you talk about what the company is working on?
MPT is a software-based company working to merge emotion detection and machine learning to take personal technology to a new level. Emotion recognition is a logical progression toward the enhancement of applications like online education, e-commerce, gaming and market research. The ability of a device to discern your mood—are you confused, frustrated, angry?—will improve your experience by adapting to where you are.
Think about the billions of dollars spent on market research. Empirical evidence shows that people don’t tell the truth. Not because they’re trying to “lie,” but because of social biases, internal confusion, difficulty articulating feelings, etc. Think about the ability of cognitive recognition systems to account for this!
The power of this space is that the team we have for machine learning is a bunch of behavioral and cognitive scientists who are intent on getting machines to learn across a wide range of demographics. If you believe in this definition of artificial intelligence, you can say this is no longer science fiction. We’re working on how to extend the necessary processing power into the cloud so it can work on mobile devices.
What do you think is next for you?
The way I’ll get to the next thing is by following this line of inquiry I’ve had about the concept of adjacencies—analyzing “where good ideas come from,” not incidentally, the title of Steven Johnson’s great book on the history of innovation. Great innovations often come from previous innovations applied in non-obvious directions. I’ve been applying this notion to the mobile space and some of the other areas in which I’ve played to see if I can see what’s next. It’s a process.
Right now, this role (Fritzky Chair) is helping me focus, evaluate new ideas, and test my strategy. I’ve got a group of students flying down to my company to deliver the final readout of a field study focused on market entry strategy and competitive analysis. The students are absolutely amazing. I expect I’ll learn as much or more from them as they do from me.
The Edward V. Fritzky Chair in Leadership serves an academic year at Foster in an advisory role. This faculty position was specifically designed to put a distinguished business leader on campus to share their expertise with faculty and students.
How a UW technology becomes a startup and its developer an entrepreneur, with a little help from a lot of friends around the Foster School and beyond
It began with a problem. A glaring inefficiency of the modern hospital that is as pervasive as it is puzzling.
In this age of digitized everything, the status of virtually every patient in virtually every medical department in America is manually tracked by erasable marker on an overcrowded white board.
Such a simple, central organizational hub works great as a framing device for the bustling casts of ER, Grey’s Anatomy, and other fictional hospital dramas. But in the real ward, it makes for a shockingly outdated nerve center—error prone, incomplete, and far too taxing of staff time better spent on patient care.
Ben Andersen (TMMBA 2012) understood this completely when he took up the challenge of modernizing the tracking system in the department of surgery at Seattle’s Harborview Medical Center. Before enrolling in the Technology Management MBA Program at the Foster School of Business, Andersen was a perceptive young IT guy working on the informatics team at Harborview, a branch of the UW Medicine Health System.
Fast forward a few years and his one-off solution has become a nascent company called PatientStream with broad ambitions in the $2.5 trillion health care industry.
Andersen’s jump from developer to entrepreneur is a study in technology commercialization at the University of Washington—of an innovator who is educated, mentored, focus-grouped, funded, challenged and championed by a fabric of experts and entrepreneurial organizations around and affiliated with the UW at large and the Foster School in particular. Complementary nodes in an ever-expanding network.
When Harborview opened a second surgery site four years ago, coordinating patients and medical staff on twin white boards proved unwieldy, to say the least.
The job of finding a solution fell to Andersen. He first sought an off-the-shelf fix, but found it didn’t exist. So he offered to custom-build a solution. And his entrepreneurial manager, Peter Ghavami, gave him the green light.
Andersen immersed himself in activity around the white boards. “I wanted to capture their language, every mark they made,” he says.
His solution was deceptively simple: an electronic patient tracking and operations management system that drew and displayed information from existing hospital systems on a flat-screen television (or any networked computer). A digital white board.
It was useful. More importantly, it was usable.
“Normally when we roll out a new system, there are groans and moans and no one wants to learn it,” Andersen says. “When we implemented the digital whiteboard, after about five minutes of training they said, ‘That’s it? I can do that.’ Support calls were almost non-existent.”
The Electronic Whiteboard (EWB), as Andersen named the digital display system, worked from the start. Easy to use. Effective. Efficient. Patient waits fell markedly. Accuracy increased. Medical staff no longer had to cruise the white board all day to track their schedule. And administrators could view instant metrics on operations and performance.
Word spread quickly. Other departments began clamoring for the EWB, first at Harborview, then the UW Medical Center. Today, over 50 departments throughout the UW Medicine system are running on the EWB.
“When I began getting request after request from other departments, I realized that this is a need that’s not being met,” Andersen says. “Maybe this deserved to be in other hospitals as well.”
Andersen had founded a company before. It was the right-place-wrong-time story of a workflow management firm serving property management/landscaping companies—launched unsuccessfully at the start of a historic housing crash.
Delivering a kindred tech solution to the health care industry, he knew, would be exponentially harder.
But Andersen held a few advantages. He had an author’s knowledge of the software and a proven track record of implementations in real hospitals. And he was enrolled in the Foster School’s TMMBA Program where he added a full suite of management skills that would be essential for a software developer to make the jump to CEO.
Suresh Kotha’s technology entrepreneurship class, in particular, was pivotal to Andersen’s ambitions. The course helped discern whether the opportunity and technology were market-worthy, yielded a working business plan, and, most importantly, demystified the entrepreneurial process for Andersen, equipping him with the requisite confidence to start a business.
“I build my course around the premise that there is nothing special about entrepreneurs—they are not some superior beings,” says Kotha, the Foster School’s Olesen/Battelle Excellence Chair in Entrepreneurship. “They simply have the skill set and confidence to do it. And these can be developed.”
Andersen got one more essential from the TMMBA Program: a team. He assembled an entrepreneurial A-Team of classmates expert in each function that would be critical to developing the business: Marc Brown on sales and custom support, Jason Imani on marketing, Anoop Gupta on technology, and Glen Johnson on finance.
Andersen found the experience exhilarating from the opening investment round, a kind of entrepreneurial trade show where 36 start-up teams fast-pitch to more than 200 roving judges over four crazy hours. “The pitch we started with and the pitch we ended with were radically different,” Andersen says. “We learned to key in on the part of the story that made their eyes light up.”
In a word, traction. More than 50 installations across three medical centers, each one delivered on-demand. Andersen polished the narrative until it was irresistible. “Ben started with a very real problem, came up with an elegant and efficient solution, and demonstrated a tremendous capacity for making people understand what he was out to do,” says Connie Bourassa-Shaw, director of the Buerk Center. “He has a compelling story to tell.”
That story took Xylemed to the final four, where it won the $10,000 second prize. “The money was great,” Andersen says. “But much more valuable are the connections that we made.”
“That’s a wise assessment for an early entrepreneur to have,” says Aaron Coe (MBA 2003), one of those connections. “There’s great value in connecting with people who add knowledge, add perspective, and challenge assumptions.”
Coe, a Foster MBA grad who helped launch 2003 BPC champion Nanostring and had an even bigger success with a pharma company called Calistoga, coached Xylemed before the semifinal, then later secured them a spot at the Technology Alliance’s Innovation Showcase.
There were many others. The team’s semifinal judges included investor Greg Gottesman of Madrona Ventures and serial entrepreneur Terry Drayton of Rainier Software and HomeGrocer.com. Both opened their personal networks to Andersen. “I’ve been amazed at the caliber of people who approached me and offered their help,” he says.
It’s no surprise to Bourassa-Shaw. At the end of the day, the Buerk Center is in the connection business.
The UW Center for Commercialization (C4C) is in the licensing business. When Andersen’s digital white board first reached the inbox of Angela Loihl, associate director of technology licensing, she shopped it around to a variety of software and health care companies. It’s a common corporate strategy to cherry pick R&D out of university labs, and C4C has negotiated more than 100 licensing agreements of UW intellectual property since 2005.
Recently, Loihl says, an increasing number of faculty and staff are expressing interest in launching their own ventures around their innovations and discoveries. So the C4C has evolved into a hybrid transaction/partnership model—a kind of bus dev team for researchers and innovators.
After the digital white board found no initial takers, Andersen—by this time well into the TMMBA Program—began changing the conversation. What if he sold the software himself?
And while Loihl oversaw the negotiation to license Andersen’s software, she also served as advisor, advocate and fan. “It was obvious that Ben had been taught well at the Foster School,” she says. “He came to us prepared, asked the right questions, and knew exactly what he wanted to get out of every meeting—in the nicest possible way.”
The kind of entrepreneur you want to root for.
Today, Andersen is a recent Foster grad, a former employee of Harborview, and a full-time entrepreneur. He has rechristened his company PatientStream, a name that sounds less like a pharmaceutical and more like a software company that tracks hospital cases. He’s incorporated the business, finalizing license negotiations, developing a mobile app, seeking investors, and closing in on several key hires.
Even on his own—his TMMBA colleagues have returned to their lives and livelihoods—Andersen is still breathing the rich air of the UW’s entrepreneurial ecosystem.
Success in the Business Plan Competition earned PatientStream a spot in the Jones Milestones/Foster Accelerator, a resource that provides expert mentoring and advising, work space in the Buerk Center’s new Herbold Innovation Lab, and a chance to earn up to $25,000 in additional seed funding if Andersen can achieve several important milestones over the next few months.
He’s pitching for considerably more money from the newly instituted W Fund. The public-private partnership aims to invest nearly $20 million over the next four years in promising start-ups spinning out of the UW and other research institutions across the state.
For PatientStream, a business that needs to act fast and first, a small slice of that pie would be a veritable feast.
Time will tell whether his company’s promise is proven on the open market, in the notoriously difficult-to-crack health care industry. But Andersen has a viable technology, a running start, an ever-expanding network of powerful allies, and a robust entrepreneurial education, in and out of the classroom.
“Between the incredibly rare opportunity to develop a technology in a hospital IT department, the skills and confidence that the TMMBA Program gave me to start a company, and the networking that came out of the Business Plan Competition,” he says, “the past few years have been a perfect storm.”
Perhaps the most telling testament to Andersen’s growth was his preview presentation of PatientStream, by all reports outstanding, to the newly formed W Fund investment committee—an intimidating collection of the region’s premier entrepreneurs and investors.
“To go in front of these guys as a young IT guy and hold your own is pretty impressive,” says fund investor Dave Marver, the former CEO of Cardiac Science. “Ben wasn’t intimidated in the least.”
CIE proves the gateway to a winning business plan
Amber Ratcliffe (MBA 2003)—Seattle entrepreneur—arrived at the Foster School’s Center for Innovation and Entrepreneurship (CIE) with the high energy and laser focus of a creative student about to start something big, and by all accounts she had come to the right place.
CIE’s core mission is to inspire, inform and empower entrepreneurship for undergraduates and graduate students across the University of Washington through course work in finance, strategy and marketing as well as with internships and mentoring.
“She was engaged the whole way and she was a rock star the whole way,” said Connie Bourassa-Shaw, CIE’s director. “She was one of those students you knew would make things happen.”
The first thing Ratcliffe and fellow MBA student Aaron Coe made happen was to take first place in one of the Foster School’s premier and most rigorous events–CIE’s Business Plan Competition. The plan they submitted was to create a company called NanoString Technologies based on molecule tracking technology developed by Dr. Krassen Dimitrov.
The next thing Ratcliffe made happen was to secure $8 million to build a marketable prototype of that technology, which essentially barcodes an individual molecule in a biological sample so it can be tracked, characterized and counted.
Now, with $30 million in Series C venture capital financing added in June 2009 to $11 million in earlier total investments, it’s clear that Ratcliffe had, in fact, started something big.
Idea turns business + action plan
Ratcliffe recently shared her role in building NanoString at the CIE seminar series “From Invention to Start-up.”
In her lecture, she detailed NanoString’s evolution from a scientific idea, developed at Seattle’s seminal Institute for Systems Biology, into a complex business and how that success challenged her to grow into new responsibilities as well as to let go of many key company decisions.
The idea, she said, came to life in the lab. Ratcliffe, then a research scientist at the institute, realized that she simply didn’t know enough business for NanoString to survive in the turbulent waters of start-ups. So, she enrolled in the Foster MBA program looking for answers to one simple question: “What’s every single thing I’m going to need to know to run a small business?”
CIE was the key program she found at Foster for not only helping her build that fundamental business understanding, but also supercharge her ability to write an effect business plan, get that plan exposed to critical eyes and expand her network of go-to people.
Winning CIE’s Business Plan Competition was her first big break – the money NanoString won became the seed money for Ratcliffe to begin building the business. In fact, CIE has awarded $812,000 to student companies in the past 12 years as well as involved more than 300 judges, mentors, sponsors and supporters each year from the alumni and business community.
“I feel really fortunate because we had a lot of exposure during the Business Plan Competition,” she said. “So, I felt like I had people that I could call and ask questions. CIE is a very good resource for those kinds of things.”
Founder turns team member
In addition to the Business Plan Competition, the broad business education Ratcliffe sought at Foster paid off. From her role as a founder seeking friends and investors, she went on to file patents, spend time in the lab, write protocols that robots could follow, brand the company, market it and even write press releases.
As the company grew, she and her team had to bring in more people with more experience in each of these areas, including a CEO who had the A-level contacts to put them in front of A-level investors.
“As a founder,” she told a lecture hall nearly full of UW students, faculty and staff who were either interested in starting a company or simply curious about the process, “it can be really difficult to step back and let somebody else own those areas and to give up some decision-making ability.”
That is a necessary evolution of the company and the founder’s career because, Ratcliffe said, the company’s success comes before the founder’s own personal goals.
“Hiring those people really helped accelerate the rapid pace of decision making you have to have in order to get a product developed and out the door before you run out of money,” she said.
Exemplifying one of CIE’s key attributes – alumni coming back on campus, sharing their experience and dolling out healthy doses of advice – Ratcliffe ended her lecture with these thoughts:
“I’ve been working on this nine years and we have not all become millionaires and we might not ever have that happen,” she said. “My take away is that you should be really clear about what the opportunities are. … You really need to look at the market, the application of your technology, the freedom to operate.”
“Most importantly, I think you need to do it because you are passionate about the technology, you are passionate about your idea.”
– Faculty perspectives, alumni happenings, student experiences, Seattle and Pacific Northwest community connections, and a taste of life around the Foster School.