Photo by Matthew Durnin, Special to the News Sentinel
Dr. Max Cheng, associate professor at the University of Tennessee Institute of Agriculture, from left, Dan McDonald, president and CEO of Phenotype Screening, and Gov. Phil Bredesen attend the China Rural Health Project Symposium on Wednesday in Beijing.
MATTHEW J. DURNIN
Thursday, October 18, 2007
BEIJING — At the opening session of the Tennessee-China trade mission, Tennessee Department of Economic and Community Development Commissioner Matt Kisber introduced Phenotype Screening Corp. as one of the state’s businesses entering China’s market.
Located in Seymour, Phenotype Screening is a technology company that produces specialized X-ray equipment for plant root system research — a scientific tool used in pest control, genetic modification and crop-yield improvement studies.
Dan McDonald and Ron Michaels founded Phenotype Screening in 2004, and after three years in business, the company is looking to enter China.
“We’re a startup company, and right from the start, we’re going to figure out how we can work with China,” said McDonald, president and CEO.
China has 20 percent of the world’s population, with 1.3 billion people, yet it has only 7 percent of the world’s water resources. With those resources taxed by industrial growth and climate change, water shortage is a serious threat to Chinese food production.
“Back home, we are talking about using agricultural land for producing biofuels,” said McDonald. “China does not have that luxury. What they are trying to do is feed themselves.”
While China’s current environmental problems create a demand for Phenotype’s products in research communities, McDonald said there are still impediments for new business.
“We have been concerned about the piracy issue. When discussing whether or not to enter China, most of our concerns revolve around how we protect our intellectual property,” he said.
But after talking with other American companies selling scientific instruments in China, McDonald is hopeful that niche market products such as Phenotype’s won’t be attractive to counterfeiters and copycats.
“We have a specialized product, and we are not going to sell millions of units. It’s not practical for pirates to get into that when they can copy millions of DVDs much more easily,” he said.
Phenotype Screening employs just three people, but McDonald said the company plans to increase that to 60 within five years. He also said the company is committed to remaining in East Tennessee’s “Innovation Valley.”
But, to attract and retain other high-tech businesses, he said, Tennessee will have to respond to competitive grant matching programs and other incentives being offered by bordering states.
“Surrounding states already have programs like this, so there is a concern that high-tech companies will cross the border simply because there are more benefits,” he said.
However, he pointed to Bredesen’s Innovation Tennessee initiative and business incubator programs in Oak Ridge and the University of Tennessee as signs of progress.
McDonald also believes his product can help boost Tennessee agricultural exports abroad, particularly to China.
“China imports a lot of soybeans but has very specific standards. Tennessee has the soil quality to meet these standards, but drought conditions have hurt soybean harvests,” he said, adding that his company’s product can play an important role in developing more drought-resistant crops.
McDonald, who has a master’s degree in electrical engineering, spent the past week presenting Phenotype’s product to universities and research institutions across China.
“I think they really appreciated that the CEO would come to answer questions in person,” he said.
Asked for his impression of China, McDonald said, “The common theme of humanity is what has hit me. Most of the time I feel just as comfortable here as I would at home because the Chinese are such a loving, fabulous people.”
© 2007, Knoxville News Sentinel Co.