Episode 11 - The Mechanics of Innovation with Rachel Burton - EIR Live

Episode Transcript
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Rachel Burton (00:00):
I do recall a colleague, early on when I was

(00:04):
there who who kind of like, youknow, whispered somewhere at,
you know, at the at the watercooler, Hey, you're doing things
too fast. It's like, Well, isn'tthat how you're supposed to do
them? I mean, if you're you'reat a startup founder, you you

(00:28):
you don't really know any otherpace in some some respects of
like if you're trying to pushsomething to market or you're
trying to follow-up on salesleads. So that was the kind of
the initial observation andlearning and navigating, you
know, decision making processesin different industrial sectors.

Ilya Tabakh (00:50):
Welcome to EIR Live, where we dive into the
lives and lessons ofentrepreneurs and residents. I'm
Ilya Tabakh, together with mycohost Terrance Orr, ready to
bring you closer to theheartbeat of the innovation and
entrepreneurial spirit. Everyepisode, we explore the real
stories behind the ideas,successes, setbacks, and
everything in between. Foreveryone from aspiring EIRs to

(01:12):
seasoned pros, EIR Live is yourgateway to the depth of the
entrepreneurial journey andbringing innovative insights
into the broader world. Checkout the full details in the
episode description.
Subscribe to stay updated andjoin us as we uncover what it
takes to transform visions intoventures. Welcome aboard. Let's
grow together.

Terrance Orr (01:33):
Man, I really enjoyed this episode a ton.
Talking to talking to Rachel wasjust a breath of fresh air. I
learned a ton, by the way,around biofuels and bio the
biodiesel world. And justwatching you two geek out was
sort of like joy like a joyousmoment for me, you know, just to
learn a little bit more. And Ithink our audience is going to

(01:54):
learn a little bit more.
But when I think about the keytakeaways from this episode and
the things that stuck out to methe most, there's two words that
really stick out to me, it'srisk taker and charting your own
path and sort of the road lesstraveled. Just sort of the two
buckets I'm gonna put, you know,Rachel in in a risk taker in the
sense that, my goodness, talkabout somebody who's willing to

(02:15):
take the leap, you know, withvery little insight about what's
on the other side, but just a agut feeling, right, and the
conviction that that she coulddo it, right, and go into a new
space that was unconventional atthe time, you know, for for for
anybody to go into and to reallyjust chart her own path. So the
first thing that stuck out to meis, one, she took the leap of

(02:38):
faith to jump into this newspace from mechanics to biofuel
and learning everything alongthe way and became an expert in
it along the way and a go toperson in that space now that
and probably couldn't imagineseeing herself doing anything
else. She did that afterundergrad and went into a trade
at the undergrad.
Love that for for the story. Theother piece of it, just sort of

(02:59):
just being, you know, able tochart her own path and taking
the road less traveled. Youknow, these are two themes that
we see a lot in the EIR that wewe bring on the show. And
Rachel, like, 10x that in termsof, you know, showing the
audience, like, how younavigate, you know, uncharted
waters in a way that'sunconventional. But also a bit
of an educator, but I'm notgonna steal the the thunder

(03:21):
there because, I want you totalk more about that, and I'm
gonna pass it over to you.
What were your reactions to theepisode?

Yeah, I think it's interesting. So to your point a
little bit earlier, you know,the the it was nice to be able
to sort of connect on thebiofuel point. And I'm glad that
we had the opportunity to sortof peel that back a little bit
through the discussion becauseI've definitely been over the
years somewhat guilty offorgetting to fill in the fuel

(03:49):
comes traditionally, you know,it's called fossil fuel because
it comes from oil. And then whenyou have biofuel, it comes from
biological constituents, whetherit's soybean or maybe used oil.
And then there's all kinds ofconversion processes that you
have to do in order for it tostart to look like a drop in
replacement.

(04:09):
And we didn't fully get to allthat, but it was nice sort of
going back and forth and beingable to sort of jump into some
of the details there. And Ithink it's, you know, I think
it's important and I'm glad thatyou kind of forced us a little
bit to, you know, kind of coversome of the gaps that, you know,
we were we were both so so intothat we didn't necessarily

(04:33):
establish some of thefundamentals and basics. That
was great. And it was it'salways good to sort of connect
with somebody after ten orfifteen years of, you know, both
of us have essentially moved onfrom biofuels directly,
although, you know, still someconnection there. So that was
great.
I think the other part, youknow, the teacher part, I think

(04:54):
throughout Rachel's journey,she's been an individual
contributor, a teacher, thenback to an individual
contributor. And then again,sort of a mentor, a resource for
folks as they build theircompanies. And I think actually
jumping back and forth,especially once you do the kind
of teacher research thing asecond and a third time, gives

(05:18):
you some really interesting andgood perspectives that you can
sort of lean upon and say, Hey,when I did this last time, this
is really useful, but maybe Ican try it again in a different
way. And I think, you know, I'vesort of enjoyed both that
perspective, but also kind ofthe eagerness, you know, kind of
the desire to keep doing it,right? Thinking about what can

(05:40):
you do with the application of aventure studio?
How can you support theecosystem? That kind of thing.
So I thought that was great. Andanother thing is, you know, I'm
always convinced that theworld's a tiny little village.
And I think the discussion withRachel and really thinking about
how Kansas City, Atlanta, RTP,kind of North Carolina are all
connected to each other.

(06:02):
We found at least three or fourcentral nodes to press on. And
it's going to be fun when werelease the episode to sort of
highlight the collaboration andall the really great
interconnectivity in the RTP andkind of North Carolina

(06:22):
ecosystem. And then, you know,sort of connect the dots even
beyond. And so it was great tobe able to sort of identify
that. And of course, you know,there's always everybody's one
hop or two hops away from eachother.
And I think we we sort ofdoubled down and proved it
again. So excited that everybodygot a chance to kind of dive
into that conversation and thatwe were able to bring Rachel in

(06:44):
to sort of dig in and connectwith us.

Absolutely, man. I'm pumped for our audience to
hear more about this episode.It's going to be very
enlightening for people.

All right. One of the things that's really
exciting for me about the EIRnetwork and generally kind of
the innovation ecosystem ingeneral is how kind of small
connected and ultimately at theend of the day, how you see kind
of folks over different chaptersof their professional career. So
what's cool is Rachel and Ifirst ran into each other when

(07:13):
we were both in kind of biofuelsland. And I think she'll get
into that a little bit morelater in the discussion. But she
was doing some really awesomestuff in the Carolinas and I was
kind of in the middle of thecountry in Lawrence, but I, you
know, was kind of following whatwas happening.
And what's cool is, you know,later this is, that was probably

(07:34):
twelve, fifteen years ago. Andboth of us have, you know, kind
of taken multiple steps in ourkind of career journey path,
whatever you want to call itsince then. So it's really cool
to sort of see how folks kind ofmake a career, make a path and
how sometimes nobody, you know,when looking back, it's sort of
unexpected in some ways. And soI'm really excited to have

(07:56):
Rachel Burton with us today foranother episode of EIR Live.
Maybe to get just started andjump into the discussion,
Rachel, maybe we'll kind ofstart from the beginning.
What was kind of your firstencounter professionally? Like
how'd you get started? And thenwe can kind of go from there and
jump in.

First off, thank you for having me on the
program. I'm super excited asengaged in the entrepreneur in
residence community and talkingwith both of you from of like
how I got involved inentrepreneurship. I would say I
truly accidentally fell into it,as many people do. I studied

(08:41):
agriculture. I had studied automechanics.
And ironically the two of thoseboth the automotive technology,
the agriculture, as well as someinterest in food and food waste.
All the all of those kind ofcombined together ironically

(09:04):
kind of ended up in starting abiofuels company that is based
in Central North Carolina. Thatwas almost twenty years ago.
That was Piedmont biofuels, andI think we started in 2025. I
mean, 2005.

Yeah. Well, it's easy. It's easy to add the
decades now. Yeah, because Idefinitely leave that on and
off. How did you meet thefounders and things like that?
Was it? Because a lot of thosestories, people kind of know
each other, have worked eachother a little bit. It's always
an interesting kind of story.How did you get into starting?
You know, did you have cofounders?

(09:42):
Did you start it yourself? Usmore about that a little bit.

Sure. So Piedmont Biofuels kind of was incubated
literally in a garage outside ofthe RaleighDurham area. At the
time I was a high school andcollege level auto mechanics
teacher and I was teaching highschool auto mechanics in the

(10:07):
morning and college level automechanics in the evening and was
just generally interested. I waskind of co located in this
agricultural program and I wasgenerally interested in kind of
seeing if there is anopportunity to connect
agriculture and renewableenergy. And this was many years

(10:32):
ago when long before kind of,you know, battery or EV
technology was available to theconsumer.
And there was a strong interestin reducing gas prices or diesel
prices. I had an interest inlooking at reducing waste in the

(10:53):
automotive industry and thenalso having an impact on cleaner
emissions through kind of just asmall network or connectivity. I
met Mike, who ended up being myco founder. I teamed up with a
friend of mine named Leaf, whohad just finished a degree in

(11:16):
sustainable fuels technology orsustainable technologies. He was
based in the New Jersey area andactually moved down to North
Carolina.
And we decided to teach a classtogether in biofuels. The
community college where I taughtautomotive essentially gave me
the chemistry lab that was beingused for night nursing classes,

(11:41):
and they kind of gave mepermission and license to to
teach biofuels technology, bothin the automotive garage as well
as the chemistry lab.

Nice. It's actually interesting. So both agriculture
and kind of mechanic are veryhigh in problem solving and sort
of systems and things like that.It's actually when we were
talking in the preparation forthis episode, talking about how

(12:15):
folks are doing a lot of kind ofmechanical education, even to
teach kind of STEM skills andthings like that. Did you see
kind of that problem solving andkind of systems approach to
stuff being helpful to you asyou dove into Piedmont?

I don't think I knew it. You know, it was maybe
intuitive in some way of beingable to not be afraid of taking
on hands on challenges. And thenalso, as an automotive
technician, you learn a specificmethodology of troubleshooting

(12:54):
problems. And so then you kindof get into this mindset of
troubleshooting trees. And Ithink that helped in kind of
developing a methodology of notonly critical thinking, but
problem solving.

Very interesting. I want to dive in here just a
little bit, because one, I dowant to ask you about the
drivers behind what got you intothis in the first place. What
made you go to school for thisin the first place to wanna
solve problems around food andautomotive waste and the other
things that you wanted to do inthat in that space that I just
want to know what motivated thatthat that journey for you to do

(13:30):
it. So I'll pause there for asecond and then I have another
question that I want to ask you.

So I actually did not had no intention in going to
trade school after finishing myundergraduate degree. I was I
kind of did it backwards. And Iwas taking some classes in the
ag program because I was workingon a local farm and I took a

(14:00):
class in tractors, tillers, andlawnmowers. It's essentially
small engine repair. And I hadjust purchased an older pickup
truck in which I thought wasgoing to be my farm truck.
The transmission soon becamequite an issue. And the

(14:21):
gentleman who taught the smallengine repair class was also the
automotive instructor at thecollege. And he said, Well, if
you're interested, I'll show youhow to repair your transmission.
I'll show you how to replace it.And I was like, well, of course,
who wouldn't?
And the short story is afterreplacing the transmission, this

(14:45):
person convinced me that Ishould go to auto mechanic
school. He was like, but you'renot half bad at this. He didn't
say I was half good either, butat the time in Central North
Carolina, there wasopportunities for young women
who wanted to go into nontraditional careers. If you

(15:06):
wanted to be a welder, amotorcycle mechanic, an auto
mechanic, or if you wanted to bean electrician, they would pay
for you to have you wouldnecessarily get a scholarship
for a trades degree and then buyyou a set of tools and then help
you get a job. And so I actuallywent down that trade route and

(15:30):
worked at I worked at a Forddealership.
I worked at GM Chevroletdealership. And then I also
worked for an eclectic, automechanic who specialized in like
Volvos and Volkswagens andPeugeots.

That's super interesting. And the reason why
I wanted to ask you thisquestion first because there's a
trend between already that I'mseeing in your background
between guests that come on theshow, which is they always do
things in a very unconventionalway. Right? And for whatever
reason, at the time, they don'teven know why, but they take to
leap to try something newanyway, right? And you did this
in a very unconventional way.

(16:10):
You went to undergrad and thenyou went to a trade school.
Usually people go to a communitycollege and then they go to
undergrad or they transfer overor they do a trade school first
and then go get an undergraddegree. You decided that, so
what? I'm just gonna try itanyway. I'm just I'm it.
Why not? Right? And built thewhole career off the back of
that from that foundation. So Ijust don't want that to get lost

(16:32):
in the things that we're aboutto get into in your background
as we set the table for the restof the the the podcast. Now
thinking about that time, youstarted to tell us about that
time in North Carolina for youngwomen getting into to trades.
Can you set the table for ouraudience talking about what was
the biofuel sort of space likeduring that season, you know, of

(16:52):
when you were start starting toyou're building Piedmont. Right?
That you you did you did whatyou had to do there. It's
starting to transition. You'reabout to make your next leap
soon, which we're we're gonnaask you about.
What was the the climate like atthat time for for this industry,
for this space? If you caneducate our audience just a
little bit.

I would say the biofuel industry was in a very
early and growing and energizedarea. It's you know, how we
ended up evolving from justgiving a community class on
biofuels and like how to makeyour own biofuel actually

(17:34):
started with the state energyoffice. There was someone in the
state energy office who calledthe community college and said,
Hey, we hear you're leading aclass on biofuels. And there
wasn't anyone at any of thelarger four year institutions,
universities that were either,teaching specifically on that.

(17:59):
And they asked that I apply tothis grant program And it was a
demonstration program where theywere like, Hey, we really want
somebody to build a reactor on atrailer and maybe drive it
around and teach farmers aboutbiofuels.
Is that interesting to you? Iwas like, Well, I have a three

(18:22):
bay garage. I have a dieseltruck that runs on biofuels. I
could probably get a trailer andwork that out. And that's how we
ended up gravitating from theclass to actual kind of pilot
scale production.
And that kind of led into moreof a buyer's co op. It's just

(18:46):
like each one was a little bitof a domino.

Yeah. And just just to jump in my experience in sort
of the biofuel industry at thattime was a lot of, you know,
demonstration reactors and sortof thinking about, you know,
because at the time, of cornbased ethanol was something that
was known and was sort of morescaled. So you saw these sort of
industrial scale plants, andthen there's sort of a cycle for

(19:11):
when it made sense to make fueland there's, you know, kind of a
couple cycles of opening,closing, things like that. But
on the biodiesel side, you know,in Europe, they did a lot of
work in kind of using rapeseedoil in order to start to make a
biofuel biodiesel. There's not alot of rapeseed in The US, but
soybean oil looks pretty similarto rapeseed oil.

(19:37):
And so there's a lot of work inthinking about, hey, can you use
soybean oil? Could you use thenused oil? And so it's really
interesting because it's kind ofwild, wild west in some ways
because people, you know, weregenerally interested just for,
you know, observation and thingslike that, but then also started
to think about, hey, you know,can we make this a business?
Where can you get enough oil orspent tallow or whatever for it

(20:00):
to be useful? What happens whenyou use tallow for fuel and, you
know, all this?
We won't dive too far into that.But it was really interesting to
see just like the earlyformation. I really do think, at
least for the commercial, likebiodiesel industry, was like
super early days and sort ofseeing different types of
players there and how theythought about the world and
operated was was, you know, atleast for me, was a good

(20:22):
experience.

I would say that we had a very similar journey of
like originally we started thefacility once we had actually
acquired an abandoned industrialpark, which was kind of just
across the town from thecommunity college. We started
that facility on soybean oilthat was kind of just

(20:45):
traditional refined bleach,deodorized soybean oil. But the
pricing of that kind of dictateda shift to something that was
lower quality. And since we arein Central North Carolina, we
shifted over to poultry fat. Andwe were one of, I think, three

(21:06):
or four industrial facilitiesthat were capable of making that
shift because it was reallychallenging.
And then ultimately, we builtout our own supply chain, which
was collecting used cooking oiland lower fats oils and greases
to convert into biodiesel.

Yes, that's cool. Maybe just to kind of summarize
what I heard, it was like alittle bit of a, hey, can you
build this sort of trailermounted reactor for just
education and help people wraptheir heads around it? Then you
kind of are operating thisreactor. You have now knowledge
to sort of scale it up and getto a place where you know, it
kind of becomes a commercialoperation and then sort of the

(21:50):
input, you know, kind of the thefeedstock, sort of the inputs
into your process drive you intohaving to adopt different
feedstock, which means thatthere's all kinds of different
production and mechanical andfortunately doesn't get too cold
in North Carolina, but also somecold weather differences between
animal fat and sort of soybeanoil. And so you get into all

(22:13):
kinds of that.
Is that kind of a fairprogression of how things went
on Piedmont?

I would say that that's a pretty good
progression. There was like onelittle chapter in there before
from the pilot scale in terms oflike crawling, walking and
running, where we built out ourdistribution business. So before
we actually built a larger scalecommercialization, commercial

(22:40):
operation, we we actually boughta truck. We just bought an old
fuel truck. We started buyingother people's biodiesel and we
started distributing it.
Leaf and I and our other cofounder, Lyle, also kept
teaching classes at thecommunity college. And it was
just an organic user buyer. Webuilt the community that we

(23:06):
didn't know that we werebuilding our buyers and our
users. But we we every year orevery semester we would
graduate, you know, another 20people who at that time were
like, hey, I'm looking forsomething, an alternative
vehicle. And there weren't EVsreally out on the market unless

(23:26):
you were going to like rip outyour entire gasoline engine and
put your own put a whole hugebattery bank that didn't quite
exist on the marketplace.
But yeah, so it was like kind ofpilot production, kind of bench
scale and then building outdistribution and then eventually
the commercial production side.

Yeah, that's I just want to, by the way, just kind
of highlight, you know, once youstart operating, the experiences
and sort of insights that youget are very different than, you
know, when you kind of thoughtabout what am I going to do. And
so one of the roles of kind ofEIRs and, you know, folks like
that are to take kind ofexperience and insights and sort

(24:08):
of translate it into a newcontext. But one of the issues
that I always have is sort ofexplaining that, hey, you know,
there's a difference between,you know, what happens and how
you thought about it was goingto happen in the first place.
Right? And so like in a lot ofstrategy discussions and things
like that, you can only normallytell the difference between sort
of an operator and then justkind of a pure strategist

(24:31):
because sort of the way thatthey think about the world is is
very different.
And so as you're talking aboutthe, you know, sort of
distribution, education, twosided marketplace, commercial
scale up, there's so manydifferent things in there that,
you know, I'm sure we'll peelback on some of that. It's just
like, it's funny to say that,you know, we did those things.

(24:52):
It's a whole different thingfrom what did you learn? What
did you do? I just, you know,sort of want to point that out
because as folks, you know, kindof work with you today and in
the future, you know, there'sall these insights that are kind
of available just because you'reout in the world doing it.
And so I think it's just kind ofdon't want to kind of go on in
the conversation withouthighlighting that for us.

And this was a great chapter of your career,
obviously, Rachel, right? Buttell us about the next chapter.
You did something interestingnext where you were negotiating
licensing deals. Tell the peoplefor who and what did you do in
that role.

Maybe part of the next chapter is connected to
this question that you guysasked, which was what was the
significant challenge thattaught you the most in your
career? You kind of prepped onthat one. And that question
really is kind of this impetusaround where innovation happened

(25:47):
at Piedmont. So we had twochallenges. Like so to me, the
significant challenge was theimportance of water
infrastructure in manufacturing.
Our industrial park was at theedge of the town, so its water
supply and the wastewaterconnection ultimately became the

(26:11):
place for not only creativethinking, but the opportunity
for innovation. Because we werelimited on our ability to
discharge wastewater. And if ifyou know anything about
biodiesel production, one of theside streams that came came off
of biodiesel can be essentiallya soapy waste stream. So like

(26:36):
water, it's basic. You use waterto kind of scrub the soap out of
the fuel.
And it's it's something that youhave to dispose of. But we had
limitations in our ability todischarge or dispose of this
wastewater. So we had to thinkabout how can we, instead of

(26:58):
just treating it and managingthis disposal as a cost center,
is there a way that we canreverse engineer and not create
soapy wastewater as a whole? AndI was lucky enough in my career
and in research and in thebiodiesel industry to have

(27:19):
really great mentors. And I hada mentor at the USDA, the
Department of Agriculture, whomentored me at the American Oil
Chemist Society, as well asintroduce the concepts of using
industrial enzymes as catalysts.

(27:39):
And that was essentially theplace where we looked at, can we
replace the catalyst in the inthe chemical process so that we
don't make this soapywastewater? So yeah, that that
was the the kind of hotbed forwhere we had our innovation, and

(28:01):
that created an opportunity todevelop a strategic partnership
with Novozymes, which is nowcalled Novo Nensis. And we
developed that partnership andlooked at building technology
for the biodiesel industryoutside of a research

(28:22):
collaboration there.

Yeah, I just love the you know, my favorite driver
for innovation is necessity. Andso it's always way better when
like, hey, we have a problem.How can we solve that problem?
As opposed to, hey, we have thisawesome mechanical chemical
technique to do whatever. Who'sgot the problem?
Right. And so it's awesome to belike, hey, we have this thing.
It's a bottleneck. You know,probably will limit how much

(28:46):
production we have. So it's coolthat you guys, you know, kind of
had the problem to bring to thesolution, not the other way
around.
And it's interesting to, kind ofconnect it to a different
because a lot of those problemsare transferable. So it's cool
that it goes. So where does thattake you? Kind of as Terrance
was going to the next chapter.

So in our in the process of commercializing the
biodiesel technology, there wasan opportunity for for me to
move over and work under theNovozymes umbrella. And that was
essentially the next chapter ofmy career is working in
different roles at Novozymes inthe bioenergy industry. So some

(29:33):
of that was working in thebioethanol space and then also
supporting the biodiesel spaceand how that technology met the
marketplace as well.

What was that role like? Is that sort of using that
background and thinking aboutkind of enzymatic approaches to
different problems? Or what iskind of the day to day? I bet
you that was a little bit of awhiplash going from an operating
sort of startup to, you know,more of like would you call it
like a technical sales role orlike research or what? What did

(30:05):
that ultimately translate into?

I think the original title was called
industrial technologyspecialist, which means
anything, really. It was therewas so much of a culture shock
of having been inside of yourown startup for close to ten
years and then moving into avery large global organization

(30:33):
that's heavily invested in theresearch and development and
understanding, learning theirprocess of innovation
development, productdevelopment, and how they launch
products. So I found it like Ikind of just soaked it up
because I was kind of justinterested in the process of

(30:55):
technology commercialization andseeing how not only how the
specific molecules weredeveloped, but how the mode of
supporting technologies from aservice side so that we had a
whole element of serviceinnovation.

Yeah, it's maybe digging into that a little bit,
of the pace and the role. Youknow, when I when I became an
EIR kind of most recently, Ifound myself to be kind of a
spiritual leader where, youknow, for the entrepreneurial
part of my career, was used tobeing sort of a hardline leader,
you know, be able to get theresources and have the executive
authority to do what I needed todo. And so for me, that was like

(31:36):
a pretty surprising experience.How was it? What was kind of the
most surprising thing?
Was it the pace or, you know, Iguess maybe initially and then
you were there for a littlewhile. So, you know, kind of
maybe first impression and thensort of maybe the biggest
difference as you settled intoit a little bit?

I think initially the pace. I do recall a
colleague early on when I wasthere who who kind of like, you
know, whispered somewhere at,you know, at the at the water
cooler, Hey, you're doing thingstoo fast. It's like, Well, isn't

(32:15):
that how you're supposed to dothem? I mean, if you're a
startup founder, you don'treally know any other pace in
some some respects of like ifyou're trying to push something
to market or you're trying tofollow-up on on sales leads. So
that was the kind of the initialobservation and learning and

(32:38):
navigating decision makingprocesses from in different
industrial sectors, like how theethanol industry might have made
just had specific decisions,whereas biodiesel was actually
at that time inside thecorporation kind of it had its

(33:02):
own decision making process asit was sitting kind of in a
different industry group.
I think one of the having beenthere for a number of years,
there was looking at this how aglobal corporation makes supply

(33:24):
chain decisions and how theyprioritize certain products
around the market demand was avery interesting lesson once I
was kind of integrated and hadthat insight, even though I
wasn't on the actual enzymeproduction side, it was more on

(33:45):
the the product launch andproduct innovation side.

Yeah, for me, that's actually one of the
interesting things. Once youactually like dig in and get to
know the organization thatyou're kind of embedded in,
there's certain things thatdon't make sense initially that
ultimately end up making sense.And I think that's kind of one
of the interesting things forexperts in residence,
entrepreneurs in residences. Theresidence does some things for a

(34:11):
reason. Not everything is justweird and slow and whatnot,
right?
And it's really interesting tosort of, for me at least, to be
able to, in engineering andconstruction, safety culture is
a big thing, right? Becausethere's, when you're on the job
site or something like that,there's a million things that
can go wrong. And so there's allkinds of different sort of

(34:33):
process and ultimately kind ofcultural things that you do in
order to manage that. Andcertain things didn't sort of
make sense, you know, lookingfrom the outside, like really
outside in. But once you're kindof on the fence, you get to a
better view.
It it was sort of interesting tosee. So it sounds like you you
were able to observe, you know,some things like that as well

(34:53):
because, you know, Novozymes andthose guys are, you know, older
companies, more established,have a sort of longer view on on
their markets, their industries,things like that. So that's one
of the things that I really kindof came to appreciate and being
embedded and partnered withcompanies.

Now, really enjoy hearing your stories about being
inside of a larger companyversus running your own company.
I spent the last few yearshelping large companies build
companies, right? And when youthink about that, it's it's sort
of they go against each other alot. Right? Larger companies
optimize for efficiency, andstartups optimize for speed,
right, and execution.
And they just don't go togetherat all the time. So I sort of

(35:29):
wanted to chuckle out loud whenyou said, you're doing things
too fast. And it was like, isn'tit supposed to be this way? Why
are you guys moving so slow?Right?
And so on and so forth. And it'sthat's just the pace that
they're used to, and it's sortof this, push and pull, like,
against each other. But whatwhat I'm grateful for with those
experiences is that it taught mehow to be bilingual. Right? I

(35:51):
can speak corporate.
I can speak startup, and I knowsort of how they operate in both
environments. That sort of mademe adaptable, right, when I
became my, EIR for the firsttime, and now I'm three x EIR,
so it seems a little bit weirdat the time. But talk to us
about that experience. Right?The podcast is all about people
making the leap to thismysterious role called the

(36:13):
entrepreneur in residence.
When did you first hear aboutthe EIR role? Did you know what
it was? And what made you takethe leap to do it?

After I left Novozymes for a couple years,
and it was a great experience, Igot to have several different
insights into kind of thecorporate innovation pipeline. I
wanted to give back intostartups and kind of connect
back into my roots. And I had anopportunity to take a technology

(36:43):
commercialization specialistrole at UNC Chapel Hill in North
Carolina. And I was alreadyembedded at UNC through the
Small Business Center. And therewas this group at UNC, which is
their accelerator program, whichis called Kickstart Venture
Services.

(37:03):
And they were building out theirentrepreneur in residence team.
And I just got an email one dayand they said, Hey, we'd like
you to be an EIR. You're like,You're already advising UNC
professors and UNC start ups.Can we just include you? So I

(37:25):
didn't even apply for it, but Iwas so grateful that I got to
have that experience becausethere were other activities
inside UNC Chapel Hill.
There was this venture catalystprogram where we got to take
students who essentially weredeveloping in their own EIR

(37:48):
capacity. They were looking atbuilding. They wanted to build
their entrepreneurship skillset. So they were kind of paired
with EIR's and startupcompanies, startup founders to
tackle a specific problem orlook at their commercialization
plan or do customer discoveryinterviews, those type of

(38:10):
things.

Absolutely. What was it like being back inside of
the walls of a university oracademic setting, having done
teaching sort of a long timeago, building a company inside
of a large company, and nowyou're back on the other side
helping people sort of buildtheir dreams, right, and helping
them commercialize technology.You're back in the walls of a
university now helping them outusing your entrepreneurial

(38:31):
chops. How was that experience?

I like being able to kind of like break down
connections of like seeing aproblem in a holistic way and
knowing, oh, I can't solve that,but I know a person who can
solve that for you. And let'sget you that introduction or

(38:52):
here is a potential strategicinvestor or an opportunity where
you could pull in a strategicinvestor or there were a couple
of times that I was leaned on tobring in somebody who was an
executive who wanted to lead thecompany and going out and
finding and curating kind of alist or a group of people for a

(39:19):
university professor. So I kindof saw it as like connective
tissue.

Oh, okay. I like that word. I like connective
tissue because I like connectingpeople and things. So let me
build on this a little bitbecause I love you using the
word connective tissue, which Ilook at universities as a
connective tissue in a lot ofecosystems to do a lot of
different things. Did you haveto directly help recruit people
to those companies and venturesthat were going to be

(39:45):
commercialized at theuniversity?
And if so, how hard was it toconvince somebody to come be the
founder or CEO of a universityspin out company based off their
technology and IP?

Yes. So there were at least one or two times
that I was helping recruitsomebody. And it is extremely
challenging if there is a hugebank of patents. Someone is very
prolific in their research andvery intelligent in developing a

(40:20):
patent portfolio. But thenthere's you have this connection
with the technology transferoffice and an interest in having
the technologies licensed out orhaving a company spin out.
And the founder or the professornot knowing which side, which

(40:42):
area do I want to be on? Do Iwant to be a chief scientific
officer or do I want to be a CEOfounder? And helping them kind
of navigate that area. I thinkthere's an opportunity to to for
EIRs to really shine and underhelping, you know, founders

(41:04):
understand, are they reallyfounder ready?

You know, that's a it sounds like you were one of
the things that I think that youneed to be an effective
entrepreneur in residence issort of know what you're good
at, connect with a place thatsort of appreciates it and has
sort of done the homework alittle bit, and then maybe a
little bit of retooling forskills. Right? Because it's a
it's a different thing to be acoach than a player. But it

(41:29):
sounds like there was a reallygood sort of give and take and
dynamic between sort of you andthe folks you were embedded
with. And so maybe can you talkabout that a little bit?
I've seen a lot of EIR roleswhere you're like, here's the
three things you do, EIR. Youhave office hours. You do this
thing. And and and the EIR islike, they're really not using
me, but that's that's what theywant. So that's what they want.

(41:50):
It sounds like you were able to,you know, kind of participate in
informing your role. But I I'dlove to kinda have you dive into
that a little bit more becausebecause it sounds like it was a
good situation or is a goodsituation.

There wasn't a short leash and you could meet
the founder or the startup wherethey were at and kind of ebb and
flow with what they needed. Youknow, some people would say,
hey, I really need to findinvestment. I like my key thing
is I'm I'm looking for equityinvestment. Another one would be

(42:28):
like, I just want to build outnon dilutive funding. Help me
build a strategy for nondilutive funding.
And another one might be like, Ireally need a strategic partner.
You could as an EIR, you kind ofwear different hats and, you
know, maybe today I'm helping,you know, look at a pitch deck

(42:50):
and there might be another daywhere you're you're making cold
calls or warm introductions topeople in your network. I think
that at least the at the timethat I was at UNC, there was an
opportunity to kind of meet thefounder where they needed to be
at that time.

Yeah, that's pretty. I mean, I love the
generally how people arestructuring this because, you
know, having spent way too longin academia myself, there's just
a clear misalignment ofincentives between sort of
academic success andcommercialization. And so being
able to sort of navigate thatand find ways to, you know,

(43:28):
bridge the gap because there's alot of cool IP. There are some
grad students and even somefaculty members that are really
interested in thecommercialization side. But I
have also run into my fair shareof stories where, you know,
folks really want to start acommercialization function at a
university, and they just don'tunderstand why the, you know,
all the professors and gradstudents and everybody aren't
just like super excited aboutit.

(43:50):
You know? And I think part of itis just kind of not
understanding the culture ofacademia or at least the
traditional culture. And so it'scool to to kind of hear stories
of you being able to navigatethat. Was there anything at kind
of UNC that was maybe unique ordifferent? Did you have a chance
to sort of compare otheracademic kind of programs?

(44:10):
Because I'm always curious onlike, what do these places do
really well? I'm curious if youhave thoughts on kind of UNC's
program for that.

Well, maybe not on UNC specifically. So although
my role was embedded at UNCChapel Hill, I worked with
professors and innovators atDuke University, at NC State, at
any of the, universities orcolleges. And it didn't even

(44:42):
have to be in the universities.It just happened to be that way
across North Carolina. I thinkone of the interesting projects
that I got to be a part of thatwas not directly connected to
UNC was doing an impactassessment of clean tech and ag

(45:03):
tech incubators across thecountry.
So I was I was part of a groupthat did some some evaluation,
like a gap analysis and like.Looking at the follow on funding
for different startups asthey've been embedded in certain

(45:25):
incubators and seeing wherethere's the opportunity for
improvement and how and how mucha network like you have in an
EIR program can make an impacton the long term success of of a
startup.

I want to double down on this a little bit
because I do think there'ssomething special about North
Carolina as a state and and andwhy this sort of works
differently from otheruniversities and institutions
who might not have the samestatewide support as as a North
Carolina that I've seen havingbeen a part of advisory boards
for different venture studiosinvolved with different
universities, there's somethingvery unique about UNC Chapel

(46:06):
Hill in North Carolina as astate in that there's something
embedded in the infrastructurein North Carolina as a state
where they wanna work with eachother, they wanna partner a
little bit. Right? So evenwithin UNC UNC, they have a
power up venture studio that'sseparate from the actual
innovation venture studio,that's separate from another

(46:26):
innovation arm, but somehow theytalk to each other at times,
right? And they also partnerwith people throughout the state
and other universities to feedideas and different things in.
So I think there's somethingspecial about the the attributes
of North Carolina as a state andhow they share resources and
things, and they don't see it ascompeting all the time.
Right? And and that creates aunique ecosystem for

(46:49):
entrepreneurship as theycontinue to grow. That's my sort
of perspective. I I only sit onone advisory board as a part of
UNC right now, but from whatI've seen being a part of that
for the last two plus, you know,three plus years there, they
they have very good connectivityto the rest of the ecosystem.
They wanna play in the sandboxnicely with everybody else.

(47:09):
So I'll just add that on from myown sort of perspective and what
I've seen in North Carolinapersonally.

I agree, Terrance. I'll give a little
shout out to, the group atNCIDEA, as well as the North
Carolina Center forEntrepreneurial Development,
though I think they those twoorganizations are really part of
the the kind of lifeblood ofkind of building that

(47:37):
environment of the non competingenvironment that we are all part
of an ecosystem.

So just to triple down on the network thing. So
Thom Ruhe was at KaufmanFoundation when I was doing the
Kaufman Global Scholar Program.And then I actually spent some
time in RTP at Cisco in theirintellectual property group as
part of that. So I've had someexposure to the program as well.
But sounds like Thom's doinggood work over at NCIDEA, which

(48:06):
is, you know, showing again howsmall really at the end of the
day the world is.
And so it's really cool to hearthat come up. But yeah, anyway,
I think that that connectivityand interaction, I think in some
ways, I guess we're we're sortof cheerleading RTP in North
Carolina here, but I'll tripledown on it as well. One thing

(48:29):
that's different maybe about RTPis that there is, you know,
multiple universities very closeto each other. And there's also
multiple municipalities and kindof the RTP story of trying to
retain talent and ultimatelykind of build intellectual
capacity in the region over, youknow, a pretty long time arc

(48:50):
with the IBMs and Cisco's andothers, you know, kind of being
long term participants is is aninteresting one because that
that is not that different fromthe Silicon Valley story, you
know, and some of the other bighubs, the Boston story, you
know, that there is anchorcorporate and research tenants.
There's flagship universitiesand sort of the key parts of the

(49:12):
ecosystem are, you know, prettypronounced and good.
It was interesting to sort ofobserve them all play together.
But at the same time, whenyou're in RTP, there's still a
little bit of friendly rivalrybetween Duke and UNC and North
Carolina State Yeah, exactly.Yeah. And so it's just like and
it was funny because I had tothe same thing happens in Kansas

(49:33):
City where the KU folks and theMU folks and everybody sort of
has, and I'm like, outside ofthe region, nobody understands
what you're talking about. Sothe regional approach is way
better than the sort of localapproach.
It's just funny how that allkind of connects and comes
together.

I also think that it's interesting. You mentioned
Kansas City and KU and I was ata biotech meeting recently in
Kansas City. And it wasinteresting to I was talking
about the RTP area, and thenthere was like, well, we have

(50:13):
our own little thing here in St.Louis. So it was kind of like
friendly rivalry between theMissouri side of things as well
as the Central North Carolina.

Yeah. And as long as everybody's kind of
understands what theirdifferentiation is, that's
actually really healthy. Youknow, where I've seen that kind
of fall sideways is whensomebody tries to be everybody
for everything and that's reallyhard to sort of compete with
some of the just older and moredense regions. And so, you know,
that's the nice thing about RTPand other places is there's sort

(50:46):
of really good foundationalelements that you can build on.

Absolutely. I want to talk a little bit about
evolution. You know, you've donean incredible job of giving us
some history and educationaround, you know, the EIR role
and how you sort of went aboutit day to day in your day to day
role. I'm curious to know yourthoughts on how you see the role
evolving with time, right? Andover time, how do you see the
entrepreneur in residence as arole?

(51:11):
Does it matter the residents?How do you see it evolving?

So interestingly, I have observed this in the last
year, and I'm hoping to leaninto an opportunity in this area
where when I was an entrepreneurin residence at UNC, it wasn't
specifically a role in which Iwould be spinning out with any

(51:35):
one specific technology or orgroup. I was more part coach,
part like interim co founder orand bounce ideas off if there
wasn't a co founder. And thenthere was kind of some part
emotional support there as well.But I've been seeing a number of

(51:59):
venture studios who are buildingtheir own entrepreneur in
residence programs where theyare hosting entrepreneur in
residence to specificallyincubate an idea into a new
company. And they're funding it.
I think that's a reallyinteresting model and an

(52:21):
interesting evolution.

Absolutely. We're seeing a lot of that, you know,
in the marketplace. I mean, fromventure builders inside of
corporates, the ones that areindependent from corporates that
are venture studios. And youknow it's kind of this odd
thing. You have some venturestudios who want to fund the
companies that they incubate.
You have others who do not wantto lead the round and fund the
companies that they incubatebecause in certain scenarios it

(52:45):
can send a certain signal,right? If I'm the person that I
need to lead the round and fundthe company for the one that I
incubated because no one elsewill, is there really something
there, right? Or, know, should Iget somebody else to lead it to
show the value and I participateto show that I have skin in the
game as well, right? So thissort of push and pull a little
bit in the ecosystem on what'sthe right or the wrong way. My

(53:08):
own personal opinion is I don'tthink there's a right or wrong
way.
Think it's what is best for thefounder and how do you align the
incentives across all the peopleand all the stakeholders
involved? Because I think itextends beyond academia. I like
a 100% agree with Ilya. I thinkit actually goes beyond academia
into venture studios, intocorporate venture builders, into

(53:30):
name your place where somebodyhas been in residence where
incentives don't align with theperson that you're bringing in
to actually do the thing. It'sgoing to be an uphill battle.
And, and, I've just seen thisway too many times having been a
part of six venture studios atthis point. There's so many
different models and it's not aright or wrong model, it's sort

(53:52):
of how do you actually align thesentence of the person coming
into the studio, and so whatyou're trying to achieve. So I
just think it's a great likeobservation that you have around
more EIRs obviously beingrecruited into venture studios
and that role evolving, but theydon't need to go out and search
for the capital all the time.Sometimes it comes with
incubating the companyessentially.

I think it's also there's something that I've been
kind of a part time coach outthat's still at UNC. It's more
of like a drop in thing withsome other entrepreneurs. It's a
class at UNC that's in theSchool of Entrepreneurship. And

(54:35):
it started out as a venturebuilding class that was assisted
with AI, specifically ChatGPT.And I was teaching undergraduate
students like, what is it liketo like, how do you fast track
building a venture and can youuse AI to help you do customer

(54:58):
discovery in a better way?
And this class that's taught byTom Tom Collopy, he he's really
innovating and and there's somesupport from our the Central
North Carolina entrepreneurshiparea like NCIDEA. And it's
really evolved into guidingentrepreneurs on how to

(55:20):
effectively build a salesfunnel, which I think if you're
an entrepreneur in residence,you understand how to get to
sales quickly. And I thinkthat's one of the things that
venture studios want. I don'tknow if you've seen that as well
in the in all the venturestudios that you've done, like
where there's been a goodexample of the EIR to getting to

(55:44):
sales quickly.

Oh, mean, so I have a ton of examples. I'll
keep myself for another hour.But you know what I've seen them
over index on is short sales butalso traction and de risking the
business as much as possible,right? To earn the right for
them to actually raise thecapital, right? And some of that
is proven that you can actuallygo out and get sales through
traction data and other things,right?

(56:06):
And I think that's interestingbecause they're raising capital
faster. They're also gettingexits faster out of venture
studios and that data is out,right? And I don't want to call
the number right now because Ican't remember the exact number,
but I think it's they raisearound 25% faster or something
like that. But, you know, we'llwe'll we'll we'll, you know, put
that one in the can for rightnow. But it's a very interesting

(56:28):
model.
I could talk about VentureStudios all all day long, but I
I I do want to pass it, backover to Ilya after I ask the
question around, do you have adream EIR role that you've
thought about, right? And wewill get into some other things
that if you could wave a magicwand and decide, would like to

(56:52):
be an EIR in this residence,where would that be?

I don't know if I have specific one, but I am
curious about the venture studiomodel of finding and I've looked
at a couple of them and I'mcurrently exploring some of them
to see if there's synergybetween kind of my you know, my

(57:18):
expertise is in ag tech andbiotech, but also water and a
circular economy and the energykind of the energy water nexus.
So I'm looking at venturestudios in those places to see
if there's a good fit betweenany of, you know, some venture
studios are backed by anexisting bank of IP. And so they

(57:42):
actually list IP. They're like,here's our IP that we have
connectivity to. And we wantpeople to take this specific IP
and move it into a viablebusiness.
So I'm just generally curiousabout those areas.

Yeah, we actually talked about this in the prep a
little bit, but maybe one of thethings as we were talking about
it earlier that I was excitedabout is just sort of reshaping
the Ph. D. Experience. So kindof like deep science ventures
and some of the work thatactivates doing on, you know,
kind of thinking about, hey, gotto write your dissertations, you
have to ultimately, you know,pierce a hole in the body of

(58:21):
human knowledge, add something,whatever. But also, what if you
were in parallel, kind ofderisking the technology,
understanding where some of theapplicable markets are?
In a longer time horizon, it'ssort of interesting to think
about where do these types ofinnovations happen? Right?
Because fifty, eighty years ago,some corporations had pretty

(58:42):
deep, you know, kind of basic R& D functions. And for the
most part, most of that's gone.Right?
And so thinking about goingforward, how does that look?
It's interesting to sort ofthink about. But I think that,
you know, that venture studio inan academic setting with sort of
the right partners and sort ofthe right both vertical focus as

(59:04):
well as EIR as well as capitalis a really interesting sort of
channel to kind of help continueto evolve that story.

I'd even argue that, you know, PhDs are, you
know, actually creating moreenduring companies when you
teach them the skills ofentrepreneurship. I think I
don't know what they're doing atFlagship Pioneering, but they're
doing something really well torecruit, you know, what they
call venture scientists. Youknow, there are PhDs who they
bring into a venture fellowship,you know, for a summer or three

(59:31):
or four months and they teachthem, you know, basically
venture building inside ofinside of Flagship Pioneering
and how to sort of like usescience based evidence and
hypothesis testing towardsventure building. So they speak
the language of the PhD and thescientists a little bit, but
also show them how to take riskin incubating new companies. So,
I'm gonna give a shout out toflagship pioneering because

(59:52):
they're clearly doing somethingright.
They incubated Moderna duringCOVID. Everybody knows about
Moderna that IPO ed and so onand so forth. And I think I
wanna I wanna say they're alsoresponsible for 25 other
companies that have IPO thatthey've incubated. So they're
doing something right in termsof matching the PhD skill set
with the risk taking and theexperimentation piece of how
entrepreneurs go about trying tobuild enduring companies. So I

(01:00:15):
think that's interesting and Ithink we're going to see more of
those models as we sort ofevolve.

Rachel Burton (01:00:21):
Is there EIR specifically at Flagship? I know
that there is some level of thatat Activate. Those might be good
folks to have on the show.

Terrance Orr (01:00:33):
Yeah, I mean, they have they don't call them EIRs
at at flagship. They call themventure scientists. So that
similar role where you hearsomebody call themselves a
venture builder versus a EIR.

Ilya Tabakh (01:00:48):
Yeah. And I think at Activate, they ultimately
become fellows, but they're allworking on their own kind of
venture. And so I've actuallyrun across a bunch of Activate
fellows that were kind ofworking on their venture. And
it's funny because there's sortof a long time arc there too,
right? Because some of them arejust getting out of academia and
then some of them havesuccessfully commercialized and

(01:01:09):
launched the company, raisedfunding.
And so they've been running fora while now. So it's interesting
to sort of see them acrossdifferent business life stages.

Actually, in the last two or three months that I
was an EIR, I was mentoring ayoung woman who had just
finished her Ph. D. And she Iwas like, it was kind of new
activate was kind of new to meat the time. And I was like, I
think you're a perfect fit forthis. And she was accepted as an

(01:01:43):
Activate fellow.

Here's another question that we have for you
just before we're about to sortof wrap it up soon. And then
I'll pass the ball back to Ilya,which is, you know, I love to
ask people, you know, we havethese very sort of, quilted
careers where there's not in astraight line, there's sort of
things that sort of happenedalong the way and we sort of
adapted along the way. Andbecause of that, our careers

(01:02:05):
look like a quilt. Andoftentimes people think these
things just sort of just happen.And I love to talk about things
that are not on your resume,things that are not
professionally related to you.
So can you tell us something,right, that's not on your
resume, that people wouldn't getfrom looking at your LinkedIn
profile?

I would say, I decided to build my own lab
during COVID, to do research,you know, and to also teach my
teach my children, you know,science experiments. You know, I

(01:02:47):
don't know if it's very obviousthat, you know, I originally in
my career thought I wanted to bea farmer.

Okay. You say some more.

You know, farming brought me to working on broken
tractors, ended up working onengines and fuels, which ended
up kind of morphing into, youknow, a quilted trajectory on
innovation.

Fair enough.

Because at the end of it, farmers in this
country, you know, in manycountries are natural innovators
because of what you had saidearlier, Ilya, around, necessity
being the mother of invention.And many times farmers, people

(01:03:42):
who are actively in the fieldworking and they encounter a
problem that they have to fixright now, they'll have to
innovate and figure out somekind of solution. So if it's a
tractor or if it's a challengewith a plant, they end up
finding a solution that theydidn't start out their day with.

That's right. And farmers also plant seeds that
other people get to bear theirfruit of later on. So there you
go. And they put all the hardwork in to do it.

And I love it because throughout this episode,
we've planted a bunch of seeds.There's even some sort of
requests for or kind of thinkingabout what are some interesting
models in academia, venturestudio. I'm excited for sort of
our audience in the EIR networkto sort of listen to the
episodes and maybe, you know,contribute and point out some

(01:04:33):
things that we're not even awareof. You know, I think we named a
couple of pretty interestingprograms and some things that
we're excited about, but it'sgonna be great to hear what what
folks that are kind of listeningand engaged are excited about as
well. So, Rachel, as we wrap uphere, what's a good way for
folks to connect with you andkind of follow your work and,
you know, kind of reach out ifit makes sense?

Sure. I would say probably LinkedIn is one of one
place I'm actively working witha wasted energy firm called
Process Works and ProcessEngineering. We like to get our
hands dirty there. And I'm stillengaged in the entrepreneurial
community here in Central NorthCarolina, an advisor, grant

(01:05:19):
reviewer, supporter of NCIDEA.

Well, really appreciate the time and the
discussion. As always, there isa couple turns and we got to dig
into some awesome and somewhatunexpected topics. And so really
appreciate you spending sometime with us and, you know,
helping us build the EIR Livenetwork.

Excellent. Thank you.

Thanks for joining us on EIR Live. We hope today's
episode offer you valuableinsights into the
entrepreneurial journey.Remember to subscribe so you
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Episode 11 - The Mechanics of Innovation with Rachel Burton

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.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}Episode 11 - The Mechanics of Innovation with Rachel Burton