The Visionary Who Shaped Austin’s Technology Industry

Founder of Silicon Hills News

Michael Dell and George Kozmetsky, photo courtesy of the University of Texas

Michael Dell and George Kozmetsky, photo courtesy of the University of Texas

At 4:30 a.m., George Kozmetsky began his 18-hour days taking meetings in his office at the University of Texas at Austin.
Entrepreneurs like Michael Dell, who was just starting a PC company, or James Truchard, co-founder of National Instruments, might drop by for a breakfast of orange juice and cornflakes.
Kozmetsky kept a white board by his desk and he was known to sketch out problems and solutions for his visitors.
His door was open for everyone from students to heads of state, said Pike Powers, a lawyer, former state legislator, economic developer and close friend and collaborator of Kozmetsky.
“George was the godfather of high technology for the region,” said Laura Kilcrease, managing director of Triton Ventures and also a close friend and the founding director of the Austin Technology Incubator. “The godfathers are untouchable. They’ve got a track record of getting things done and getting them done right. George was old enough and wise enough and generous enough to think about what was best for the greater good of the community.”
Kozmetsky came to Austin in 1966 after he successfully co-founded Teledyne, a computer electronics company in Silicon Valley. He served for 16 years as the UT dean of business. He believed strongly in collaboration among government agencies, educational institutions and entrepreneurs. He launched the IC2 Institute in 1977 and the Austin Technology Incubator in 1989. President Clinton awarded Kozmetsky the National Medal of Technology in 1993. Kozmetsky worked tirelessly to promote Austin’s technology industry until his death in 2003 at the age of 85.
His son, Greg Kozmetsky would often prepare the coffee and juice for his dad’s early morning meetings.
“Dad had a philosophy that you don’t need sleep,” Greg said. “You just need to rest.”
Kozmetsky would take 20 minute to 30 minute rest breaks throughout the day.
“He would wake up at 3 a.m. and start thinking about things,” Greg said. “By 4 a.m. he was headed to the office.”
When he got older and he could no longer drive, his assistants, Pattie Roe and Ophelia Mallare, would drive him.
His wife, Ronya, also actively supported her husband. They even taught a class together at UT on marriage and entrepreneurship. She wrote a book “Making It Together: A Survival Manual for the Executive Family.” Ronya, who died in 2011 at the age of 90, was a licensed pilot and she ran the RGK Foundation.
Greg, also a pilot, would fly his dad around the country and world.
“I knew he was different,” Greg said. “I didn’t know how different he was.”
When Greg was a kid his dad would gather his children and the neighborhood kids together and sketch out ideas for them on a whiteboard in their house. He thought if he could explain his ideas so that kids could understand them then others would too, Greg said.
“He was first and foremost an academic,” Greg said.
ATI Founder George Kozmetsky, photo courtesy of the University of Texas

ATI Founder George Kozmetsky, photo courtesy of the University of Texas

Kozmetsky, born in Seattle to Russian immigrant parents, grew up poor and even worked at the fish docks as a kid. He understood the value of an education. He earned his bachelor’s degree from the University of Washington at the age of 20. He then served in the Army Medical Corp. in World War II. When he returned, he earned his MBA and doctorate degrees from Harvard University. And he went on to found Teledyne, a conglomerate of companies which made everything from airline parts to batteries and precision instruments.
This year, Kozmetsky’s brainchild, ATI, turns 25 years old. It is one of the oldest continuously running incubators in the country.
ATI has graduated 142 companies, which have created thousands of jobs and had an economic impact of more than $1 billion on Central Texas’ economy.
Yet many people who make up the bustling technology ecosystem in Austin today don’t know the critical and crucial role Kozmetsky played in its vision and development.
“George was such a compassionate, thoughtful and intellectual leader,” Powers said. “He didn’t want to be adulated and praised. He wanted to do things that made a difference. And he did.”
When ATI launched in 1989, Austin was in dire straits economically.
The city had one of the highest commercial real estate vacancy rates in the country as a result of the Savings and Loan crisis.
Austin had a skyline of so-called “see-through buildings,” because they were just shells built during the real estate boom that hadn’t been finished out, Kilcrease said.
Banks foreclosed on about 1,000 homes every month.
Austin needed ATI to jump-start its economy, Kilcrease said.
Kozmetsky recruited Kilcrease to run ATI. Kilcrease had been in town running a high tech company. She did a fair amount of community service.
“One day, out of the blue, George called me,” Kilcrease said.
His wife, Ronya, gave a taped session of a women’s management group in which Kilcrease had spoken, to her husband.
George Kozmetsky, photo courtesy of the University of Texas

George Kozmetsky, photo courtesy of the University of Texas

“He said my name is George Kozmetsky and I have an idea and I’d like to talk to you about it,” Kilcrease said. “Initially George asked me would I volunteer, which I did for quite some time.”
In 1980, only 12 incubators existed, according to the National Incubator Board. By the time ATI launched that number grew to 40. Today, there are more than 1,300.
Without an incubator like ATI, Kilcrease thought she might not be living in Austin for long. Austin’s economy depended on the government and the university. It needed to diversify.
Austin’s technology makeover began when the city landed the Microelectronics and Computer Technology Corporation (MCC) in 1983, followed by SEMATECH in 1998. Both ventures involved government, university and business collaboration, which set the tone for ATI. It received support from the chamber and business leaders, Powers said.
Its goal was to nurture high tech startups with high growth potential, Powers said.
“We needed to build our own future and create our own well-being,” Kilcrease said.
“It wasn’t a job. It was a mission.”
After launching ATI, Kozmetsky then launched the Capital Network, the first angel network in Austin, which ran from 1989 until 2004 and was the forerunner of the Central Texas Angel Network.
In addition, Kozmetsky created the Austin Software Council, which is now known as the Austin Technology Council. The networking organization allowed tech entrepreneurs to collaborate with each other.
“People would look at ATI like it was the one thing – in fact it wasn’t – it was the start of a much bigger, dynamic goal and plan of what we wanted to put together,” Kilcrease said.
The cornerstone institutions that support technology entrepreneurship in Central Texas today are all the products of Kozmetsky’s vision, said Isaac Barchas, director of ATI.
The impact of ATI stretched way beyond Texas, said David Gibson, associate director and senior research scientist of the IC2 Institute. He worked with Kozmetsky for 20 years.
He travelled with Kozmetsky to Russia, China, Taiwan, Korea, Brazil and other places.
“We trained the first incubator director for Shanghai in the early 1990s and the first director of an incubator in Moscow,” Gibson said.
Kozmetsky helped to found the Cross Border Institute for Regional Development at the University of Texas at Brownsville to encourage collaboration between the U.S. and Mexican entrepreneurs.
“George, even in his 80s, was a visionary,” Gibson said. “He saw things way out there.”
He understood the importance of collaboration and how communities work together to become stronger.
“Austin did collaboration better than most cities and still does and that’s why it’s been so successful,” Gibson said.
He had the vision for the Austin “technopolis” in 1986 and he set that vision in place, Gibson said.
But when ATI launched, people were skeptical.
“I remember very vividly they looked at me with my accent and they thought incubators involved chicken and eggs,” said Kilcrease, who is originally from England. It was tough at first to convey the concept, she said.
Austin had an incubator before ATI that went out of business after three years and burned through $8 million or $9 million and had no surviving businesses, she said.
ATI launched with a budget of $125,000 for the first and second year and by the end of the third year, ATI had turned a profit, Kilcrease said.
Kilcrease and Kozmetsky promised that ATI would create 200 jobs in three years from new companies.
And within 10 years, these new technology companies would occupy all of the vacant square footage in Austin.
They exceeded those goals.
“A big audacious goal we had was not just to incubate companies,” Kilcrease said. “It was to diversify the economy and create an ecosystem that could work on its own and ATI was going to be the catalyst to make that happen…. You fast forward and you look at Austin now that dream was fulfilled in about 12 years.”
By end of the 1990s, Austin became one of the major tech centers in the country.
“At the time, it was very pioneering ground work,” Kilcrease said. “George was always very much a future thinker.’’
He had a brilliant mind and a 50-year vision plan for Austin, Kilcrease said.
His vision is still being realized today, said Barchas, director of ATI.
”The Austin we are living in, we are living in because of George Kozmetsky. He sacrificed to do it,” Barchas said. “He showed us that if we are smart and dedicated, and if we are willing to bring others into the process and give them credit, we can change the world, and we can change Austin. It wasn’t George bullying his vision through other people. He was able to form enduring alliances that meant his visions would last beyond him.”
And they did.

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