Key to Prosperity
How innovation helped Aris Melissaratos change the face of Maryland business
In late January, New York City Mayor Michael Bloomberg made a whopping $350 million donation to his alma mater, Johns Hopkins University, pushing his total gifts to the institution over $1 billion. It’s an astounding sum, given out of profound conviction and commitment to the work Hopkins does.
The day the big news broke, Mayor Bloomberg tweeted, “Giving is only meaningful if the money will make a difference in people’s lives. Johns Hopkins makes a difference.” Bloomberg affirmed the importance of research and collaboration brought to life by people who help innovation happen.
Johns Hopkins Senior Advisor to the President for Enterprise Development, Aris Melissaratos is one of those people. He’s moved from Europe to America; from school to industry; from corporate life to startup investing; from private investing to government executive, and now into the academic world. In each context, innovation has been crucial.
From Adversity to Aspiration
Aris’s ethnically Greek family achieved major business success in Romania, but their prominence became dangerous when communists took control of the country after World War II. Wealthy people who stayed behind the Iron Curtain faced seizures or even imprisonment by local communist governments, so the Melissaratos clan headed to Greece, then on to Baltimore in 1956.
Young Aris worked all sorts of jobs in the Baltimore neighborhoods where European immigrant communities settled after stepping off ships nearby. He learned English, then advanced math, then got his degree at Johns Hopkins in electrical engineering.
By the time Aris was hired at Westinghouse, the beginnings of the digital revolution were evident in the projects he managed. Over the next few decades, Aris saw the entire progression of analog to digital systems in electrical engineering.
Math and science teachers sometimes struggle to help students engage with the subject matter: for Aris, advanced electrical engineering coursework came up nearly his first day on the job. “It was mind-boggling how much you could integrate,” he reflects. To make radar work at Westinghouse, he would have to perform every formula he learned in calculus and differential equations back on campus, while managing the mechanization of dozens of mechanical parts and dozens of people who made it happen.
Moving Parts, Moving People
Moving parts and dynamic people are a theme for Aris, who keeps his focus on managing and motivating people in a way that will maximize their human potential. He holds that true for everyone, from janitors to the best engineers in the world. “Each one requires a different kind of career attention,” he emphasizes, and it’s important to make them believe management cares about their future. It’s more important, of course, for that to be true.
From those first projects out of college, Aris rose to become VP of Science and Technology at the company’s Pittsburgh R&D center, modeled after Bell Labs. There he was, a self-described “manufacturing guy from Baltimore,” managing over a thousand PhDs who “literally wrote the book on everything electrical.” He was the first person without a doctorate to hold that position.
At Westinghouse, Aris gained a diversity of experience that allowed him depth of knowledge in many areas along with the connections and silo-smashing privileges any cross-pollinator would dream of. “I got exposed to full range of applications: fossil fuel power; nuclear power, the birth of the nuclear navy” and the list goes on. “It was a fantastic experience.”
In the 90s, Westinghouse brought in outside leadership, then decided to sell its commercial technology operations and push into television. In December 1997, Westinghouse became CBS Corp., and on February 1, 1998, Aris retired.
As his long-time company changed its stripes, Aris witnessed what he calls “a phenomenal sea change” in the way the American economy values innovation. “Instead of manufacturing hard products you could build with your hands, we were moving toward valuing media, concepts, and ideas.”
Spinning Out Innovation at Thermo Electron
After Westinghouse, Aris joined Thermo Electron, a Boston-based advanced engineering company founded by a Greek immigrant who wrote a seminal book on thermodynamics—just the type of innovator Aris could quickly build a rapport with.
Thermo Electron was one of the largest and most innovative instrument companies in the world. Unlike the new Westinghouse, Thermo Electron was innovating and still making physical stuff.
Thermo Electron opted to spin those innovations out, so every product that came out of its labs would be put into a publicly traded company. Thermo Electron profited from the stock issuance, but Aris was startled to see that the process of valuing those Thermo Electron for IPO was, in his words, “unscientific.” Investment firms were hungry for the business preparing those spinout offerings, so few people were complaining, but there was room for improvement.
Then it came time for Aris to take part in Thermo Electron’s own strategic transformation. “The profit and loss sheet must have had 700 lines of contributions from different companies it had acquired. It was a large laboratory essentially.” To make Thermo Electron leaner, Aris sold most of the businesses he was managing, and took control of two himself. Reinvesting the money he had made on Westinghouse shares allowed Aris to invest in dozens of tech startups, including the crème de la crème of Thermo Electron spinouts.
From Private to Public to Academic
From success at Thermo Electron, Aris took his talents to the Maryland Department of Business and Economic Development. Governor Robert Ehrlich was impressed by how quickly Aris got to know the guts of any given company. Lt. Gov. Michael Steele even joked about charging a consulting fee because the advice Aris gave Maryland business was so spot-on.
As the Maryland economy shifted from manufacturing to a technology base, Aris built a staff to nurture Maryland startups and position the state for the modern knowledge economy. After his term at DBED was done, it was on to Johns Hopkins, where Aris would add to his base of knowledge about innovation and economic development.
Hopkins planned to turn its research base into a physical presence that would draw major global life science companies to Baltimore. When the economy soured, that prospect dimmed. “So we ended up emphasizing building companies from within,” Aris recalls. “We spun out twelve in the first year and the average for the previous decade had been four per year.” These are early stage companies that require a lot of patient investment and take a medical concept to fruition, which can take a decade. Johns Hopkins has the institutional patience for research, and Aris Melissaratos possesses books worth of the knowledge it takes to bring innovation to market.
Innovation: The Key to America’s Prosperity
In 2009, Aris published Innovation: the Key to Prosperity – Technology and America’s Role in the 21st Century Global Economy. In it, he emphasizes a national strategy of gaining and retaining the global innovation leadership. “Having given up the strength of volume manufacturing to the rest of the world, we can still retain global economic supremacy through innovation,” he says. That vision becomes clear when you read how tested principles and good sense are being applied in equal parts.
In the book, he proposes a much stronger advisor to the President on science and tech, who could work with cabinet members as an equal and have tech transfer become a corporate goal. Large corporations should interact with government agencies to bring products to market, in a broad partnership that includes universities, with their public funding and ability to transfer technology to expert entrepreneurs.
It’s no coincidence that the large-scale push he calls for reflects Aris’s own career-long efforts. And Michael Bloomberg, Bill and Melinda Gates, and many others know that investing in innovation works best when the process is championed and steered by people like Aris Melissaratos. He has thrived through many changes, and under his leadership, the impact of investment in Johns Hopkins innovation will continue to increase around the Mid-Atlantic region, and around the world.
Originally published in SmartCEO magazine, April 2013
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