Paul Frison is President and CEO of the Houston
Technology Center (HTC), a business accelerator for Houston-based
emerging technology companies. Paul has lived in Houston since 1975
during which he has been President and/or CEO of three public companies
— LifeMark (1975-1984); NYSE ComputerCraft (1984-1986); NASDAQ
LifeCell (1986-1999). He has been involved in four other start-ups by
serving on the Board of Directors. His experience includes numerous
mergers and acquisitions. He has raised multiple rounds of venture
capital, two IPOs, and more than a dozen follow-on rounds of public
We recently sat with him to explore his vision for
Technology in general and Houston as center of it in particular.
Question: Houston traditionally is considered a
center for Oil & Gas industries. What steps the city or HTC is
taking to make technology a substantial part of the local economy?
1999, consulting firm McKinsey conducted a survey to identify the
characteristic's required for the city to become a technology center.
They contributed 4 consultants who research all major technology centers
in USA on East and West coast. Their findings were that Houston is a
sleeping giant. It has all the ingredients to attract entrepreneurs to
start emerging technology companies. Houston is home to NASA, it has the
second largest medical center after Boston, it is home to largest oil
& gas companies in the world. The major issue was with the
perception of Houston as a low tech city. Houston is rarely mentioned in
top 10 US cities in terms of venture capital activity and technology
innovation. Our strategy is two-fold, first to improve the image of the
city and second to help nurture development of new start-up companies of
which HTC is an integral part. According to a study conducted by A. T.
Kearney there are 300 software development companies in Houston and over
1000 IT services companies in all. This is a sure sign that we are on a
Question: Houston has yet to produce a nationally
recognized corporation like Dell in Austin. What are the reasons for
it is true that we need a bigger splash that could have a ripple effect
and filter down. Houston is home to BMC software, which is one of the
top three software companies in the world. Some of HTC clients have been
acquired by bigger corporations, which have created wealth that we are
expecting to be channeled back to the local economy. Houston has a large
number of high networth individuals from energy and real estate sectors
who are now willing to invest in technology start-ups with the help of
HTC to screen and qualify candidates. Houston Angel Network (HAN) has 75
members, HTC is proud to have been the initiator of this network.
Question: According to recent venture capital
investment figures, Houston is not among the top 5 cities for venture
investing. How can this scenario be improved and what role HTC is
playing to attract more venture funds?
of all venture funds are invested in East and West coast. It will be
sometime for Houston to attract a major portion of these funds. One way
of doing that is creating more success stories. Once that momentum is
built it will be difficult for VCs to ignore Houston. HTC is playing a
vital role in creating that dynamic environment. We are expanding our
facilities to house higher number of client companies.
Question: Do you think quality of life is an issue to
attract engineering talent to stimulate start-up activity?
are many ways to look at this issue. In terms of cost of living Houston
is a best place to start business as compare to Seattle, Boston, San
Francisco and New York. For a start-up it is important to keep the
overhead costs low to conserve cash for growth. But it is true that we
need to make improve quality of life in Houston especially quality of
air, road network and social events. In last 15-20 years, Houston has
progressed much in this direction. We have been successful in embarking
on revitalizing the Downtown, which is center of all activities now. But
we have a long way to do in this area.
Question: Houston has emerged as home to a diverse
group of immigrants from Asia and Africa. How is this immigrant
community contributing to the local economy?
believe in diversity and helping underserved communities to share and
contribute in the local economy. HTC, for that matter is an equal
opportunity employer, has many management and advisors from all these
Question: Many technology-centered cities have formed
alliances with out-sourcing centers in India, Philippines, China etc.
What kind of alliances HTC has formed in last 5 years?
Paul: We have
not actively pursued this activity but we do welcome visitors from all
over the world to share experiences with us. We recently had delegations
from Malaysia, Japan, Indonesia and Libya. HTC is also member of
National Business Incubator Association (NBIA) which is also an avenue
for us to learn and share our expertise with others. HTC is a non-profit
organization funded by contributions from the private sector.
For example, Reliant provided us electricity for the
first two years, now Entergy has taken up this electric bill. Sterling
Bank donated money so that we could buy some of the office furniture.
Question: How do you see the effects of Sarbane-Oxley
bill on corporations?
scandals coming out from some of the respected corporate names had
shaken the investor confidence. It was important for legislatures to
rebuild that confidence. Sarbane-Oxley is a product of that thinking.
But like any legal statue and regulation it has produce some undesired
consequences. I am certain lawmakers would review that bill and make it
more effective. But I believe some measures were required to regain
Question: What is your long-term vision for Houston
and HTC in terms of technology?
believe bringing people together is a first step in creating a dynamic
environment conducive to the creation of good companies. HTC will
continue to provide a focal point for people to come together. We will
continue our focus on the five technology sectors we have identified. In
this wealth creation process, we expect people to reinvest that wealth
in accelerating the growth of the local economy. Houston's Angel Network
is one-success stories in that direction