ICYMI: Glenn Youngkin’s $156 Billion Legacy

Standard & Works

By Zach Silber

During Glenn Youngkin's term as Governor of Virginia, CEOs committed $156 billion of investment to the Commonwealth - more than the previous six gubernatorial administrations combined.

As he prepares to leave office, we spoke with Youngkin about how he pulled it off.

• "This is my background," Youngkin told me. "I spent a 30-year business career growing businesses and creating investment opportunities - that's exactly what economic development and winning for Virginia is all about."

Youngkin's personal involvement in winning deals has been a unique advantage for Virginia - forged as co-CEO of investment giant Carlyle Group. "I have been deeply hands-on," he said.

• The feat is even more impressive given the constraints of Virginia's Constitution, which doesn't allow governors to serve consecutive terms.
• It's no exaggeration to say the scale of investment will shape the trajectory of Virginia's economy for generations. But nowhere is the economic impact more stunning than in one industry: life sciences. More on that in today's briefing.

On the last working day of the year for many, spending time with Youngkin was reflective and informative.

• It was also a fitting capstone to the first 100 days of Standard & Works - where we obsessively cover how state and regions are competing and carving out their roles in America's industrial resurgence.

1. Pharma's Overnight Sensation

Virginia had a modest life sciences sector - until four months ago.

That's when $12.5 billion in new investment projects were announced in rapid succession across three plants: Eli Lilly ($5 billion), AstraZeneca ($4.5 billion), and Merck ($3 billion).

Now Virginia is poised to be one of the nation's leading states for biomanufacturing.

• The three companies are backing a $120 million pharmaceutical manufacturing workforce center that will train 2,500 workers every year.

How did Virginia become an overnight sensation in life sciences? Youngkin's strategy was deliberate.

• "When we came into office, we identified many areas that we thought would be huge growth areas for investments and jobs," Youngkin said. "And one of them was of course the, the pharmaceutical and life sciences industries."
• "Virginia had a good resume," but the state wasn't winning the transformational projects. "We weren't really winning the big, big, big opportunities."

Two forces accelerated the opportunity:

• COVID exposed pharmaceutical dependence: "We saw coming out of COVID that basically 80% of the most important APIs - the active pharmaceutical ingredients - were controlled by India and China," Youngkin said. "That's all coming home."
• Federal policies driving reshoring: Youngkin credited the "huge collaboration with the Trump administration" and the U.S. Investment Accelerator, which works in parallel with his Administration's Made in Virginia Investment Accelerator to move deals fast.

With the sector identified and market forces aligned, Youngkin went to work.

2. The Rolodex Flex

"I call lots of CEOs," Youngkin told me. "My relationship with the CEOs across the pharmaceutical industry is really, really good. I call them every day and go see them frequently."

This isn't ceremonial. Youngkin walked us through how he closed the historic pipeline of pharma deals:

• AstraZeneca: Youngkin and his team were in the company's offices the week they were deciding where to site a new plant. Thirty-three days later, AstraZeneca committed $4.5 billion to Virginia - the company's largest investment ever.
• Eli Lilly: Youngkin took a whole pitch team to Indianapolis. The result: $5 billion - also Lilly's largest investment ever.
• Merck: Youngkin said he had daily engagement with the company's leadership leading up to its $3 billion expansion project.

3. Delivering the Goods

CEO relationships only work if the state can deliver the goods.

• "It was so much more than just wanting to win. We had to have a much better offering," Youngkin said.

A key life sciences competitor Virginia had to beat: its southern neighbor, North Carolina.

• "In North Carolina, they've got everything," Jay Biggins, a veteran site selector whose firm works with Eli Lilly, told me this Fall.

North Carolina had a record-breaking year of wins, capped by Novartis announcing a flagship manufacturing hub just last month.

• That success has stretched the supply of construction, labor, and sites, Biggins says, which has led some companies to examine other markets with the "starter ingredients" to become emerging life sciences clusters.

While this dynamic might've created an opening for places like Virginia, Youngkin blew the doors off.

Virginia's life sciences infrastructure:

• Workforce: Virginia overhauled degree offerings through community colleges, universities, and high schools, Youngkin said, creating pathways and credentials in pharmaceutical manufacturing. This proved to be a smart proactive investment ahead of the $120 million workforce training center now underway.
• Sites: "Virginia hadn't invested in business ready sites to any reasonable degree at all," Youngkin said, so he worked with the General Assembly to allocate $500 million to prepare them. "That changed the game for us."
• R&D: The Commonwealth launched a suite of initiatives aimed at invigorating its research base and commercializing intellectual property.
• Speed: Youngkin retold a compliment he received from AstraZeneca's CEO Pasacal Soriot, who said "the new standard is the Virginia speed of doing business." Helping set that pace was a 35% cut in regulations that Youngkin says delivers state businesses $1.4 billion in annual savings.

Youngkin's philosophy: " I do believe one of the biggest challenges in government is it gets comfortable moving slowly, and you have to move at the speed of business, not the speed of government."

4. A Generational Legacy

Beyond the press releases, the eye-popping figures, and the groundbreaking ceremonies, the life sciences cluster being formed in Virginia will have real life impact for decades to come.

Biggins gave us a glimpse into the future:

• "You think of those three dots where those companies are - the region between them will start filling in with employees working within reasonable commuting distance of at least two of them, if not all three.
• If you're moving a family to take a job, you want mobility to take other jobs without moving your family again."
• "Those are reasons why clusters are so powerful."

5. The Competition

Virginia's life sciences playbook demonstrates what it takes to compete in what Youngkin calls "the SEC of economic development."

I asked how he viewed the competitive field.

• "It is a very fierce competition, particularly among states that understand that competing means winning."
• "Listen, there are losing states and there's winning states in America today," Youngkin said. "These states like Virginia and North Carolina, Tennessee, South Carolina, Georgia, Florida, but also Arkansas and Oklahoma and Indiana - these are states we compete against all the time and they're tough competitors."

The difference?

• " I think we have executed extremely well. I've been deeply engaged with every aspect of it, but I do believe that you have to keep improving and keep competing. You can't rest on your laurels."

Youngkin has applied that mindset to another sector getting some attention...

6. Data Center Dominance

Virginia is the nation's data center capital and is on track to retain that title - the Commonwealth has the largest pipeline for planned development, according to JLL.

I asked how the state can keep its momentum and whether it even should, in light of data centers becoming more politically and community sensitive.

Youngkin didn't hesitate: "The momentum is huge and it should be."

• "It's a national imperative that we win the data center race and the artificial intelligence race," Youngkin said.

But he also sees the economic case for localities.

• "If there's a county in Virginia that doesn't want a data center, the one right next door to them does," Youngkin said. "The job growth and the tax benefit of having data centers is extraordinary. They fund schools, they fund law enforcement services."

Looking ahead, he's bullish on how the data center industry is evolving:

• "This next stage of development in the data center world where there is huge conservation with water and bring your own power to move behind the meter is a massive development."

While the incoming Spanberger Administration and General Assembly will set their own course on managing data centers going forward, Youngkin points to the strong foundation in place.

• "We have an ecosystem unlike any place else. We have the supply chains in place and that's why we have had a number of very large data center announcements just in the last four years."

The Masterclass

Not every governor will have Glenn Youngkin's CEO rolodex. But his epic run offers replicable lessons in how to defy gravity in economic development.

• Speed is a competitive advantage. A single four-year term forced urgency and rapid execution.
• So is strategic focus. Virginia identified pharmaceutical manufacturing as an opportunity and built the infrastructure around it, leap-frogging the country's most established markets that site selectors traditionally favor.
• Competing to win. Relationships may have opened the doors, but Youngkin's tenacity and Virginia's readiness closed the deals.

The formula, in Youngkin's own words:

"At the end of the day, time is money, pace is everything. And that's where our aggressive speed on top of the deregulation that we have undertaken, sites being ready, and a workforce that is ready and able to go today has changed everything in the Commonwealth."