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Key Idea: Give To Add

Ken Buechler says that employees of Biosite are offered stock because he and his partners believe in the idea that giving something leaves the giver richer. 

Key Question:

A: 

Be generous and give whatever you can give to employees.  Kim said giving stock to employees is, "not dilutive in the sense that it's adding more to the share pool, it's actually adding more to the talent pool, so it's accretive."

Q: What type of person will be attracted to the idea of earning stock options?

A:
The person who wants to work hard and to be rewarded for that hard work. Not the person who want to warm a chair. Offering ownership then does two big things for you. First, it attracts the hard worker and second, it turns individuals into team players. Employees don't look at you as the owner, they look at you as the largest shareholder and they see you as generous not greedy.

Think about it

Do you think you could attract more talent if you offered stock options?  What could you accomplish if you were surrounded by the smartest people in your industry?
 

Clip from: Biosite is helping to save healthcare.

San Diego: Early insights by three people, Dr. Gunars Valkirs, Kim Blickenstaff and Dr. Ken Buechler, opened the way to develop devices that are now used virtually every second of a day to aid hundreds of thousands of emergency medical technicians, nurses, doctors and patients to diagnose medical conditions faster and more accurately. In this episode of the show, you will see their little device, Biosite Triage® for rapid diagnostic testing, in action.

When they had the idea, everyone told them, "You're crazy. No way! It'll never work." 

They began their business in 1988. Today, it is a global organization with annual revenues over $250 million. And it is all based on a product line that never ever existed before they created it. The firm's first product, The Triage Drugs of Abuse Panel, was cleared by the U.S. Food and Drug Administration (FDA) in 1992.

They didn't stop there. They now test for congestive heart failure, heart attack, and a long check list of diseases with very strange names. Beyond their unstoppable energy and passion for continued research and exploration is the belief that their success to date does not begin to scratch the surface of the potential of diagnostics. Here you look into the heart of creativity.  

Editor's Note:  Since this episode was taped, Biosite was purchases by Innverness Medical Innovations.

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Biosite, Inc.

Kenneth Buechler, co-founder, President, Chief Scientific Officer

9975 Summers Ridge Road
888.BIOSITE (Customer Service)
San Diego, CA 92121
858.805.8378

Visit our web site: http://www.biosite.com

Office: 858.805.8378

Business Classification:
Biomedical

Year Founded: 1988

Give To Add

HATTIE: It's obvious that the three of you are not greedy.

KIM: We share it equally. I mean that's part of the beauty of the thing. We all sat down and said, we've done nothing yet.
 
All we did was get money out of our friends Tim and Ted to go forward and try to do this. There's no way to value our relative contribution other than saying we split it a third, a third, a third and move forward. I've never had a regret about doing it that way.

Don't be greedy and hope that by having three happy people that stay for a long time, as opposed to maybe one guy that's really happy because he took the majority, and he loses those two golden egg layers over the course of time. I don't think that's a winning formula. I think you're going to create animosity, and you're going to lose the people that are actually going to create the growth going forward.

We always give stock to really all full time levels in the organization, and invest over four years period. It's based upon a strike price of the public markets when you join the company. So the earlier you join it, or there's a dip in the stock, there may be fluctuations in that value, but options are an important part of what keeps everybody sort of thinking on the same page.

HATTIE: Right.

KIM: This is not dilutive in the sense of it's adding more to the share pool, it's actually adding more to the talent pool, so it's accretive. And if you like the kind of growth rates that we've put up over the last five, six years, that's because we had good retention and we had the layers of the golden eggs stay with us as opposed to jumping off the start company. So this stuff is going to get quicker, simpler, more immediate and I think more importantly, more definitive. Certainty and speed is really going to be the name of the game because everyone wants to drive down costs of episodes.

GUNARS: We were in its early in the game, we identified what is necessary to have the freedom to operate in this space. We went out and got that intellectual property, and now we're in a privileged position because of that. And at least for the next five to 10 years we don't see that another diagnostic company can get into this business and copy our model.

KIM: I used to wake up in fear in the early days, fears a great motivator. A lot of us lost a lot of sleep, there's not a satisfaction that we put together more resources to make this dream and this model happen and it's not all incumbent on just Gunars or me or Ken. We now have allies that we've hired in that fit with the management team and it's a real sense of satisfaction to wake up and know that we build a bigger entity, far more talented that can really withstand some of these adversities that are going to come our way at some point in time.
 
 

 
 
 

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