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High-tech clusters spur growth in western Montana

Montana State Roundup

January 1, 1994

High-tech clusters spur growth in western Montana

With the state's natural resources industries struggling in recent years, western Montana has gained some respite from a relatively new sector: technology-based businesses.

Most of those companies are clustered in just a few cities, and local officials say that their impact is significant. The university towns of Bozeman and Missoula—along with Kalispell, Butte, Great Falls and Helena—are the main beneficiaries of this technological growth. For example, 20 new technology-based companies in Bozeman (population, 22,600) since the late 1980s has greatly improved that city's economic prospects, says Dixie Swenson, executive director of the Gallatin Development Corp.

In Bozeman, about eight companies are engaged in research or production of laser optic equipment, and Rebecca Mahurin, director of intellectual property at Montana State University (MSU), Bozeman, says much of that work is based on research that originated at the university. Often such research is sponsored by a business, which then retains the first option to license the product, Mahurin says.

There are also about 12 bio-tech companies in the Bozeman area, conducting research for products in the food, health care, pharmaceutical and environmental industries. Like the laser optics industry, many of these companies have benefited from MSU's technology transfer program, according to Mahurin. "The root of the expertise is found at the university," she says.

Similar expertise exists in Missoula at the Montana Biotechnology Center, which is housed at the University of Montana and funded by the Montana Science and Technology Alliance, a state agency that provides start-up capital for technology-based businesses. Ron Klaphake, executive director of the Missoula Economic Development Corp., recently produced a directory of biotech resources that describes the state's public and private research and development efforts. He says that the greater awareness that industry participants have of the state's entire resources, the larger the industry will grow.

While part of Klaphake's job is to lure companies to the Missoula area, he says that the emergence of the technology sector (Missoula also has a growing software engineering industry) has occurred largely on its own. Development officials from the state and other communities agree: Montana is a nice place to live, says Jon Noel, director of Montana's Department of Commerce, with a strong university system, qualified labor force and attractive natural amenities. Besides, he adds, there is no need for many of the new companies to locate near a particular industrial or transportation base; many new products are information-based and are transferrable via electronic means, and others—like biological products or software—are quickly shipped by plane.

The president of a Missoula biotech company, Nurture Inc., which employs 13 at its research center, echoes those ideas: "Nurture Inc. is located in Montana for a variety of significant reasons, paramount among which are low cost of research and development and ready access to the resources of the University of Montana system," writes Richard Potter in Klaphake's biotech directory, Montana's Biotech Connection.

David Fettig