Nebraska's slow burn healthtech success challenges the urgency of Philly's growth

Technical.ly

6 days ago

This collaboratively reported story is part of the partnership between Technical.ly and Silicon Prairie News, which focuses reporting on the Omaha and Nebraska innovation ecosystem. Find more at technical.ly/omaha.
Nebraska's emerging healthtech scene mirrors Philly's early days — and could teach its more mature counterpart a thing or two.
Both regions are growing their life sciences sectors through strategic collaboration, strong talent pipelines and research-backed innovation. While vastly different in scale and reputation, each has lessons to offer the other — and both may need each other as federal research funding declines.
'If I went to [a Nebraska startup] and was like, 'Here's $10 million,' most of them wouldn't actually take it because they wouldn't know what to do with $10 million,' said Ben Williamson, principal and general counsel at the statewide investment organization Invest Nebraska.
'If you're in Silicon Valley, the culture is to raise as much money as you can and then light it on fire in service of growing as fast as you can, and that's just generally not how Nebraska entrepreneurs build companies.'
Ben Williamson, principal and general counsel at Invest Nebraska
Nebraska's burgeoning healthtech sector mirrors many of the foundational elements that have made Philly a national life sciences powerhouse: robust tech transfer infrastructure, support from top research universities and a commitment to commercialization through startups.
Philly's scene is well-established and has seen past booms and multimillion-dollar raises, but now it can learn from Nebraska on the different types of partnerships that lead to consistent gains. The slow burn, rather than chasing rapid growth, is what's working, according to Williamson.
'If you're in Silicon Valley,' Williamson said, 'the culture is to raise as much money as you can and then light it on fire in service of growing as fast as you can, and that's just generally not how Nebraska entrepreneurs build companies.'
On the other hand, some of the same qualities that inspire collaboration may be a barrier to the ecosystem's growth. The 'Nebraska nice' reputation comes with a healthy dose of humility and risk aversion that can limit aspirations (and innovation). The state's ecosystem could look to more mature hubs, like Philly, to spur a bolder mindset in order to level up.
The two regions can lean on each other to determine how to weather the current decline in federal funds supporting research and universities.
'Nebraska's startup ecosystem reflects the best of its culture: collaborative, down-to-earth and eager to help,' said Erica Wassinger, cofounder and general partner of the Nebraska-based VC group Proven Ventures. 'We often say it's a community of 'barn-raisers and casserole-makers' — people who will gladly make connections, introductions and lend support.'
A foundation built on academic partnerships
The collaborative nature goes a long way in the early stages of building a startup and ecosystem, but more than collaboration is needed in Nebraska to build a world-class reputation on par with Philly's.
Nebraska has strong players that support healthtech and similar businesses, according to Williamson. That infrastructure is built on:
Collaboration between UNMC and the wider University of Nebraska system
Networking opportunities facilitated by university tech transfer offices like UNeMed and UNeTech
Active partnerships between hospital systems, researchers and founders
'Nebraska's startup ecosystem reflects the best of its culture: collaborative, down-to-earth and eager to help.'
Erica Wassinger, cofounder and general partner of Proven Ventures
With institutions like the University of Nebraska Medical Center (UNMC), Creighton University and the Catalyst innovation hub, Nebraska is steadily cultivating the partnerships, lab space and funding necessary to turn academic discoveries into venture-backed companies.
This is extremely beneficial for researchers, inventors and aspiring entrepreneurs who are already affiliated with a local university. University hospital systems benefit from being among the first to access the latest innovations to improve patient outcomes and experience.
In Philly, the impact of these partnerships has been global, making the city one of the top 15 places in the world to found a company. The region's universities led much of the charge in vaccine development, which gave Philly the spotlight as a life sciences hub it still has today.
University of Pennsylvania researcher Katalin Karikó co-developed the technology behind the COVID vaccine, with the university holding key patents that were later licensed to vaccine developers. Today, the university has invested $18 million to 'democratize RNA technology' in a new 'BioFoundry.'
Plus, the 'eds and meds' city's life sciences market employs tens of thousands of residents, bringing new companies into the region and boosting economic growth.
Like Nebraska, many of these wins can be attributed to collaboration. Coalitions like the Keystone LifeSci Collaborative, tech transfer efforts and attractive programs for growing startups all draw stakeholders to land in the city. Having notable institutions like the Wistar Institute and being recognized by the federal government as a hub for precision medicine helps, too.
The academic backbone of startup growth
In both Philly and Nebraska, many healthtech innovations can be tied directly to the academic institutions. One of the biggest challenges in healthtech right now is the cuts to federal grants that fund university research — the kind that often leads to startup spinouts.
Additional community initiatives in the Omaha metropolitan area, such as the completion of the new 170,000-square-foot Catalyst innovation hub and ongoing events like UNMC's Idea Pub: Morning Edition, which fosters collaboration between entrepreneurs and university researchers, provide avenues for further medical breakthroughs and connections that have the potential to create companies.
Nebraska has a strong presence in the adjacent healthcare staffing industry as seen with established players like Triage, Medical Solutions and Fusion Medical Staffing, as well as with new players like Superb Shifts operating in the state, Wassinger of Proven Ventures added.
Startups offer Nebraska researchers and inventors new avenues to bring ideas to market, said UNeMed President and CEO Michael Dixon. However, larger companies generally want more proof of concept and marketability before they're prepared to license early-stage technologies, he said.
In regard to healthtech, it's less obvious than agtech or logistics tech for how Nebraska can uniquely stand out from other states and ecosystems, Williamson said. That's especially true as other regions tout more unified support from key stakeholders: local government, universities, investors, entrepreneurs and industry leaders, similar to what helped Philadelphia thrive from the get-go.
At UNeMed, the tech transfer office assists emerging companies by connecting them with available grants and funding resources offered through the state, such as the Business Innovation Act, UNeMed's Dixon said. But he has voiced concerns over recent uncertainties and considered cuts surrounding these funds.
Next, ecosystems need the real estate to grow
While projects like UNMC's Center for Research Excellence Building are on the way, Omaha and greater Nebraska still face gaps, particularly in comparison to innovation ecosystems like Philly, Dixon said. Specifically, he said there is a need to expand wet lab infrastructure.
As Philly knows, however, that comes with a substantial investment of money and time. Schools like Drexel University jumped on the lab space shortage, building out a half-million-square-foot building with research and lab space. Other examples include redeveloping the empty, 120,000-square-foot Hahnemann University Hospital campus and adding 200,000 square feet of lab space to the Curtis building in Center City.
It's a work in progress, though. Spark Therapeutics has been working on a $575 million lab space in the city since 2021, which is still not completed.
Nebraska is running into hurdles from local governments and an aversion to risk among corporations and industry leaders to take this next leap.
Broader recognition has the potential to attract more investment, from inside and outside of Nebraska, to create more healthtech-specific accelerators and financial incentives to propel the ecosystem to the next level.
Nebraska can look to Philly's successful track record of public-private collaborations as a roadmap.
Beyond real estate development and stakeholder engagement, Nebraska also faces a challenge: helping medical professionals understand the entrepreneurial path.
There's a need for due diligence before deciding to pursue the entrepreneurial path, and medical professionals need to be convinced to see themselves as problem solvers rather than the 'hype' around being a founder, Wassinger said
'Saying 'startup' to someone specifically in the healthcare space — everything about them has been programmed to not risk,' said Wassinger. 'That's almost the antithesis of their entire psyche.'