You Can't Google Insight: Up Close with Steve Burrill


Author: 
Theral Timpson

Talk to anyone about the history of biotech, and at some point you’ll end up talking about Steven Burrill: venture capitalist, merchant banker, consultant, speaker, mentor, and teacher. On Nov 4, Burrill received the Scrip Lifetime Achievement Award in London's Grosvenor House.

“There’s an incredible number of people and companies who really owe their existence and success to Steve,” says colleague Fred Dorey, special council at the law firm, Cooley Godward Kronish.

Steve’s colleagues from the early days of biotech are quick to acknowledge him as one of the major architects of the industry.

“I’m receiving these lifetime achievement awards now.”

I met Steve at his office for an interview just days before the trip to London.

“I don’t know if it’s because they think I’m going to die. But it is nice to be recognized.”

Steve gives speech after speech around the industry and many insiders are familiar with his optimistic outlook and special insight for life science. My hope in interviewing him was to see Steve Burrill, the person. What was behind his great success?

In the spring of 1966, a day after graduating from college back in Wisconsin, Steve began work at the accounting firm, Arthur Young in San Francisco. His father George was head of the largest CPA firm in Wisconsin and his grandfather was the first licensed CPA in the state.

“My dad was well known, and everywhere I went, I was George’s son. I wanted to move to a place where no one knew my dad--who he was or what he did--and start my own career. Whatever I accomplished in life was going to be because of me.”

Steve leans back in a small side chair backed by the windows of his 27th floor office at One Embarcadero Center, the backdrop of downtown San Francisco below him. He is always in a pink tie. Burrill, whose own name is synonymous with the history of biotech doesn’t wait for questions. He’s comfortable talking about his success and happy to tell his story. Steve notes that his fortune has been largely a matter of timing, that he “was a useful cog in that early machine.” But timing itself is not all that has brought Burrill to his lofty perch overlooking the financial district of San Francisco and an entire industry. Nor was it his father’s name. Success has come from a special ability to develop his own insight and foresight, a passion to solve some major world problems through biotech, and an inner drive that has been with him since he can remember.

Insight x Foresight = Burrill

Early on, Burrill found a niche with Arthur Young (later Ernst & Young), going on to become the youngest partner in the firm. New biotech companies were looking for accounting help that was independent of bankers and finance people. Steve brought that expertise and also what was to become his most valuable asset, his insight. Offering an innovative pricing program where his clients could pay less up front for services and more later as they grew, Steve quickly filled his rolodex with life science and hi tech names, becoming advisor and often friend.

“I got my firm to put the senior partners on companies that had the least ability to pay,” said Steve. “Most firms assigned their top people to the clients with the most zeros.”

And it paid off. Steve helped build the firm to a $2.5 billion business, the largest in the world at the time. Another innovation Steve made was to persuade his clients to get him involved earlier, arguing that accounting and finance decisions should influence the business strategy. Typically a company contacts an accounting firm to do an audit after the transaction has taken place. This is still today one of Steve’s major points when he gives a speech on successful entrepreneurship.

“Small companies are too focused on patents and IP that they don’t consider enough the barriers to operation. The financing should dictate the strategy,” he told an audience of students at Stanford. “Many companies with a good chance at succeeding fail because they have a drip, drip approach to funding.”

Steve talked about the unique culture that was Silicon Valley when he built up the business at Ernst and Young.

“There was little fear of failure. In Wisconsin, or the East Coast, if I’d started a business and it failed, that reputation would carry through with me. Out here, people looked at failure differently and still do. When we find someone who’s stepped out and taken a chance, it’s a good thing. Obviously they are willing to do things others wouldn’t. There’s a naive confidence that is so important. They haven’t yet learned to listen to others say it can’t be done.”

Steve began to feed the innovative culture with his ability to see the bigger picture.

“There’s lots of information out there. Especially now. It’s ubiquitous and free. But there’s little insight. You can’t google insight.”

Being involved with business after business giving financial advice, he was able to pick up the general trends and form an overall view.

“I knew that I knew more about the industry than those in the industry,” he said with his trademark raspy voice.

“Come over here.”

Steve walked me over to a wall above his desk covered in career memorabilia, including a framed cover of GQ featuring a hip-hop Steve Burrill.

“Take a look at this,” he pointed to a framed program of his own TV show called Prime Time Tech TV that aired on FNN or Financial Network News (this was before CNN).

The list sported the names of the gliteratti of the hi-tech world, including John Sculley, former CEO of Apple, and Tom Peters, best selling business author. The TV show wouldn’t last, but was instead replaced by an annual report Steve compiled on the state of the biotech industry, now known widely as the Burrill Report. This year marks the 25th anniversary of the book, 25 Years: Looking Back to See Ahead.

On New Years Day of 1994, Steve founded Burrill and Co. exclusively focused on life science.

“I came to the decision that the best way forward was to own, and not to do. Ernst and Young was a service company. We didn’t own anything.”

This began Steve’s ambition to raise a VC fund.

“With Burrill I wanted to build value. And it wasn’t all about the money. I had a strong pull to the promise of biotech and what it could do to solve many of the world’s major problems.”

Steve charged straight up to Wall Street and made his pitch. Wall Street listened and acknowledged his idea, but the investors wanted to see a track record. Burrill licked his wounds, then went to the CEO of Bayer, the German pharma company.

“I asked him, how do you do innovation?”

Bayer’s leader told Steve that if there was innovation in the world, he was on top of it. Steve countered back.

“If I was involved with a start-up and we had a novel product, you’d be the last I’d tell. You give me $25 million,” Steve proposed, “and I’ll give you a window on innovation.”

He got it. And a lot more. Steve took the same speech to IBM, Proctor & Gamble, Chiron, Novartis and others and built himself a $600 million fund.

Burrill has now initiated what he calls version 5.0 of his company, the global phase, and is on his fourth VC fund.

“We have a wallet. That makes a difference. We can play monopoly with real money.”

Burrill and Co. consists of three divisions which make it such a unique firm. First of all, they are a merchant bank that handles many of the major industry deals. Second they are a VC firm with just under $1 billion in management. The company manages funds for other countries, including Brazil, Malaysia, Russia, and China. The media division is divided between content production--the book and monthly and weekly reports on the business side of the industry--and conferences around the world focusing on various modern trends including Personalized Medicine and Digital Health.

I saw Steve recently at his last Personalized Medicine Conference about which I wrote a month ago. Steve’s conferences are different from others. He introduces the show with his own distillation of available info and combines it with an outlook for the future. Always an outlook. He can talk about a world we don’t yet live in with authority.

“I’ve built a business from looking ahead. It’s like the game of hockey. You don’t go to where the puck is, you go to where it’s going to be.”

Burrill sat at the head of the conference room and stayed involved from beginning to end. He is able to attract the top names in the industry to speak. (Francis Collins called and asked to be included in the last conference.) Then, perhaps most importantly, Steve follows up each talk with his own probing questions before turning the queries over to the audience. He uses the conferences to challenge himself and others to take the next step.

Steve is perhaps in a unique position in that he draws practical insight from each of the three divisions of Burrill and Co.

“We challenge companies to think big, to think globally, to come up with new business models.”

Anyone who has heard Steve talk is familiar with his optimism for biotech. He enumerates the various challenges facing us today including food and fuel shortage, availability of clean water, climate change, bio security, and healthcare. He tells audiences around the world that biotech has answers to all of these. Motivation obviously comes from being able to make a difference. Steve Burrill

Steve Burrill at his office in downtown San Francisco Provided by Burrill and Co.

Building a Company and a Legacy with a Passion for Biotech

“When I was 10-12 years old my dad would drop me off at church on Sunday. Then he’d go to the office. Later I asked him, dad, why didn’t you come to church. I knew he wasn’t anti-religious. He said to me, ‘Steve, I loved my work.’ I’m the same way.”

Before sitting with Steve, I came across a short publication on the coffee table put out by the Life Sciences Foundation. The small booklet included brief excerpts about some of the original figures in biotech and biotech VC. Steve is the chairman of the board for the foundation which also contains some of the who’s who in the industry, including John Lechleiter of Eli Lilly and Phillip Sharp of MIT.

“What we want to do with the Life Sciences Foundation is to tell the real story of what happened. History and information are different. History is putting the information in a context that makes it useful in the future. Young people today don’t know who Cetus Corporation was. When Cetus went public, they had the biggest IPO of any company to date. That’s a big deal.”

With several staff members located at Burrill and Co’s office, the foundation has recently put up a website with an archive of oral histories and documents significant to the history of biotech. It’s a history which gives Steve pride and which he wants told. As someone who helped Cetus, one of the first biotech companies, get started in 1971 and who helped write the original business plan of Genentech back in 1976, he has ridden the high times and the lows. A highlight? I ask. He replies that there were so many, that when Roche purchased Genentech it was a truly great moment. At the time Genentech was valued with a higher net worth than Pfizer. “Who would have believed that this small biotech start up would grow so fast and overtake one of the largest pharma companies in the world?” Steve’s passion is contagious.

“My biggest surprise is how far we’ve gone. It’s well beyond what we envisioned. Long ago I realized that this wasn’t about being a day trader. We were interested in making a big difference in the world.”

Steve’s boss at E & Y asked him once why he was “messing around with this” (life science companies.) The young accountant shot back, that this is going to be the future. “I thought I’d be fired, but it’s how I felt.” Does Steve feel that he can influence the direction of the industry?

“Yes,” he says without hesitation. “At Burrill and Co. we always challenge the industry to go further, to do more.” The science has moved faster and further than anticipated, he says, but the business hasn’t. “We never anticipated knowing the causal factors of disease. That we would be predicting and preempting disease.”

Recently Burrill was asked to give a speech in L.A.

“I was at the airport and the driver showed up. It turned out to be a conference attendee who’d asked to drive me. He had heard me speak some fifteen years ago and whatever I’d said changed his life. So he wanted a few minutes with me so he could express his gratitude. Moments like that I remember.”

An Energizer Bunny Inside

Burrill goes in to work at 3:30 - 4 a.m. each day, sometimes working until 7 or 8 pm. “I’m a morning person. I come in early when I won’t be disturbed and get six or so hours of work in by the time most people are getting to work. ” (He even got the Starbucks across the street to open at 3:30 so he could stop by for his coffee.) With a staff of 40, Steve manages Burrill and Co. and travels the world. “I thought as I got older, I’d travel less. But it’s not true. I travel more. Except now it’s not to Monterey or Sacramento but to China and South America.” Steve recently returned from a 24 hour trip to Azerbaijan.

What keeps Steve Burrill going, I ask.

He thinks at some level he’s still trying to prove to his dad he can succeed.

“At school,” he says, “I was never good enough. A few years ago I was asked to give a speech back home in Wisconsin. My father--he was pretty old by then-- was present in the audience. I announced that I wanted to take a personal moment and then asked my dad to come up to be recognized by the audience. I said from now on, he’ll be known as Steve’s dad.”

After that did Steve come back, sit down at his desk, and say now I can relax--I’ve done it?

No. The word retirement is not in his vocabulary, he says. What does he do to relax? He doesn’t. He owns a house back in his home state of Wisconsin and has collected nine boats. Steve admits when he spends time in Wisconsin, which he says is as connected through internet and blackberry as anywhere, he does feel his blood pressure go down. But he’s working all the time.

“Here it’s Mercedes and business suits, there I go around in t-shirts driving pick-up trucks.”

The ever enthusiastic Burrill offered up some of his failures as well. For example, when he raised his first fund of $600 million, he put the investors on the board and gave them a say. It turned out to be a mistake which he did not repeat the next go round.

“They were trying to study up and make suggestions, when all I really needed was a yes or no. I was doing all the work.”

Work is life for Steve Burrill. When you email him, you can expect a quick response though you don’t know if he’s in his office, at an airport, or staying in Wisconsin. This last week it was off to London to accept the Scrip prize.

“I like the chase, the action, the thrill of how much I can get done in a day. I have an energizer bunny inside. Some folks like to be on the mountain and look out at the view. I prefer the climbing. I’ve never reached the top.”

Steve says there’s still a lot to do, many problems in the world to solve, that his firm could be more successful, that he’s thinking about book no. 26 and 27.

“He’s one of these characters you see in a cartoon that has all this dust swirling around him. He’s full of motion, full of energy, full of excitement.” says a friend, Ralph Snyderman, Chancellor Emeritus at Duke University and co-founder with Steve of the company Proventys.

What is it you want, I ask when Steve’s secretary knocks to announce his next appointment.

“Whatever it is, I still haven’t got it.”

A video made when Steve received the BayBio Pantheon Lifetime Achievement Award



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