Industry organizations provide resources that help answer the many questions that arise.
Some expected and some not. Countless articles analyze the thousands of start-ups that have come before to distill down the key factors of success: is it the idea, the team, the plan, execution of the plan, a founder’s tenacity and grit, or something else?
While industry organizations don’t hold the keys to success, they provide a start-up with an instantaneous network of resources: advisors, potential partners and collaborators, investors, as well as programming and business solutions (i.e., group purchasing discounts). The lone and lonely start-up becomes part of a much larger and stronger collective voice.
Industry organizations, also referred to as trade associations, can be one of the best resources for a startup. Most associations are 501(c)(6) designated non-profits – meaning they are membership-based associations that engage in lobbying activity. In other words, trade associations are typically a collective of industry stakeholders, who represent ‘the voice’ of the industry – from advocating for (or against) legislation to negotiating business savings. That’s how Biocom California works as well. With their mission of “accelerating life sciences,” they work to represent and promote the California life science industry and support their members’ advancement and growth through what they call their “5 Pillars”:
This post will focus on the three that tend to provide the most immediate and direct value to start-up members: Capital, Savings, and Advocacy. For networking, read Where to Find Life Science Events in Orange County.
According to Biocom California’s 2020 California Life Science Economic Impact Report, the state of California employs 1.4 million people in total jobs attributable to the life science industry, received $4.59B in research funding from the National Institutes of Health (NIH) in FY2019 and boasts 15,341 life science establishments—a number which is growing every day.
Industry organizations regularly collect data on economic development, grant funding, and other areas relevant to the industry community. More than simply a series of numbers, this information can be incredibly useful to startups, helping them to make critical decisions such as where to locate: Where are the ‘growth markets’? Which region has a critical mass of biotech companies (and therefore talent and other resources)? What kind of investments are being made, by whom, where? Large (and growing) amounts of research funding indicates a vibrant innovation community … and also the likely presence of state-of-the-art equipment in their core facilities.
One of the most important benefits a trade association offers a start-up is access to capital. At a high level, a trade association is interested in increasing the influx of capital into the region to stoke the state’s innovation engine and fuel California’s economic growth. Most directly relevant to start-ups, this means connecting them with investors and potential collaborations partners.
Just as start-ups are looking for introductions to investors and partners, investors and partners are always looking for start-ups at the forefront of innovation in which to invest or with which to partner. Trade associations with a rich member network that spans from the earliest of start-ups to the largest of global pharmaceutical companies provide a robust community offering benefits across their member spectrum.
Biocom California offers a diversity of programming at the local, state, national and international levels to increase capital investment in the region. An important component of this is connecting members to a wide variety of investment opportunities. Biocom’s Capital Development (CapDev) group leverages technology to identify new sources of capital for member companies and ensure that California remains a top region for investors of all sizes, global pharmaceutical companies, and others – to complement that $4.59 billion of NIH funding that enters the state!
In the past three years, Biocom’s CapDev programs facilitated over 800 ‘one-on-one’ meetings and directly connected close to 400 companies. Biocom does this primarily through structured programming like “Partner Days” and “Venture Days”, where they facilitate tailored 1:1 meetings with a specific partner or VC (or other investor) looking for a specific type of opportunity; as well as the annual Global Partnering Conference held every February, which features the key decisions makers at marquis-named global companies and facilitates hundreds of 1:1 meetings with start-ups.
Acting as a convener or aggregator, membership to a trade association with robust programming can save a start-up valuable time and money – being able to leverage your membership dues to gain tailored, high visibility to quality investors and partners versus spending thousands of dollars on a variety of partnering conferences around the globe.
Find out more about the Biocom Benefits by downloading the overview.
Another valuable way that industry organizations support not just startups, but all of its members, is with savings opportunities through group purchasing programs. These programs give small companies the buying power of their larger corporate counterparts. Large companies frequently benefit from volume-based discounts when they purchase from suppliers. Since startups only buy small amounts in comparison, they end up paying much higher rates. Purchasing programs aggregate the total volume that an industry organization’s members buy and use that figure to negotiate better prices with large suppliers.
These suppliers are not only lab supply vendors, but also insurance (product liability, D&O, health benefits) and services in areas like human resources, financial/accounting, facilities, operations, information technology, communications, and travel. Many, if not most startups save enough money in a year from these group purchasing contracts that they pay for in membership dues, making this one of the biggest direct benefits offered by membership to an industry organization
Biocom California has over 30 such contracts with several quality vendors. With a separate purchasing group arm, Biocom California is also able to seek out and negotiate purchasing contracts for its members. They also allow startups to proactively request help sourcing, vetting and negotiating a group discount with a particular type of supplier—within reason, of course.
Often the least appreciated by start-ups, advocacy is a key component of most industry organizations. Many of these organizations can trace their roots back to a group of companies in an industry that banded together to have their voices heard at “City Hall” or in Sacramento or DC.
Biocom California is no different. When it first started in San Diego in 1995, a group of biotech start-ups banded together to ensure that the perspective of the biotech and life sciences industries were not only recognized, but recognized as being important to the economic growth of the region. Twenty-five years on, Biocom California now has major offices in San Diego, Los Angeles, South San Francisco, as well as in Sacramento and Washington, D.C.
Through their advocacy work, Biocom and industry organizations like them, work to amplify the voices of their members at all levels – local, state and federal. They educate policymakers on the industry’s needs, engage them as partners to advance policies that support research and innovation, while also working to defeat proposals that would be detrimental.
What many members do not realize, is that industry organizations can also help assist with specific needs of members, what Biocom California refers to as “concierge service” – such as helping companies navigate through permitting or even getting a pothole fixed. If you run into any issues, calling your industry organization is a good place to start.
For a start-up, an industry organization can serve as your outsourced public policy and government relations team – keeping you apprised of pending or newly changed legislations. Biocom hosts legislative roundtables with elected officials at all levels and has several committees comprised of members, from federal committees like the IP committee to regional committees centered around local issues such as land use and taxation. In addition, they have a full-time staffer dedicated to regulatory policy.
Trade associations work to further the interests of their industry—startups included—and biotech industry organizations are no different.
Learn more about Biocom California at www.biocom.org