Rich Lunak Seeds Ideas, Putting Pittsburgh Center Stage as an Innovation Powerhouse

A native Pittsburgher, Rich Lunak remembers the economic low plaguing Pittsburgh as he was graduating from high school. This has always served as a personal motivator to keep Pittsburgh growing and making its mark as a competitor and leader in innovation.

Upon graduating from Carnegie Mellon University with a Bachelor of Science degree in electrical and computer engineering and a master's degree in business administration from the University of Pittsburgh, he joined an automation division of Westinghouse Corporation in 1987. At the time, Westinghouse was second in annual U.S. patent awards only to Bell Labs, Lunak recalls. He started his career there as a development engineer in the late 1980s, as the company was growing its commitment to build businesses from new discoveries and research.

"That whet my appetite for entrepreneurship," said Lunak, adding that the experience also led him and a friend to strike out on their own in 1990 with Automated Healthcare, a company whose mission was to apply automation technology to the medication use process in healthcare settings.

Lunak remembers his family members thinking he had ruined his career when he left the security and prestige of Westinghouse to work in a three-person startup. Lunak helped to lead the high-tech start-up to positive cash-flow, profitability, and generation of recurring revenue within three years of operation before being acquired by McKesson Corporation in 1996.

"What I came to learn is job security is not defined by who you work for, but what kind of marketable skills you get in a small company and in a startup, even when they're not successful. You get exposed to so many things as a young professional, and it's such an accelerated growth and learning environment. It was a great experience. Not to mention, it can be the most fulfilling endeavor you will ever have in your life – to put out products, hopefully build a successful company, and establish a culture within it that you helped create on your own," Lunak said. "To a young entrepreneur, I would say this is your chance to seize an opportunity and put your own dent in the universe."

Following the acquisition, Lunak would go on to serve as chief executive for McKesson's Automation Group, a $300M technology business unit with over 13,000 customers worldwide. The Automation Group consisted of five autonomous businesses that provided a wide range of products including a hospital-based robotics system, retail prescription fulfillment systems, clinical nursing systems, medical supply management tracking systems, and payor software systems. Lunak also worked with the company, applying his expertise in health care, patient safety, and technology realm, to help build other businesses for McKesson.

In the mid-2000s, Innovation Works was looking for a new CEO to help regional entrepreneurs build and scale high-growth businesses. Lunak took the position and would go on to spend almost two decades helping Pittsburgh's entrepreneurial community build high-growth businesses.

"I spent the last 17 years watching and helping our entrepreneurial community grow and thrive. It's been an incredibly gratifying experience – not only to work with entrepreneurs but to see the city where I was born and raised and that I love become a sought after place nationally for entrepreneurs and technologists," he said.

In addition to his work at Innovation Works, for the past 10 years, he has also served as the founder and managing director of Riverfront Ventures, an early-stage venture capital fund for which he successfully secured initial anchor investments to launch the fund in 2013. He remains one of four managing directors responsible for funding, selecting investments, and overseeing company portfolio performance.

In February 2022, Lunak announced his retirement as president and CEO of Innovation Works, the region's largest seed-stage investment group for startup companies. The decision came on the heels of a lengthy tenure leading the organization, which has invested more than $113 million across 600 companies since its formation in 1999.

As one of the nation's most active seed-stage investors, Innovation Works has helped develop 20,000 jobs in the Pittsburgh region's tech startups, draw the spotlight to emerging tech sectors, and create a climate of innovation in the region. During his time in leadership, Lunak was responsible for all investments and accelerator and business assistance programs for its technology start-up entrepreneurs.

"It's critically important for entrepreneurs to solve problems that customers care about. An early mentor said to me 'you either have to be half-the-price or three-times-as-good in order to succeed,' and I think that there's some truth to that," Lunak said. "It's incredibly important for entrepreneurs to do a lot of customer discovery early on and really find that right product-market fit to make sure that you know the issues, problems and struggles your customers face and offer a solution that helps them succeed."

In response to the Pittsburgh Regional Health Initiative's new Regional Autonomous Patient Safety (RAPS) initiative, Lunak said Pittsburgh has an excellent opportunity to use its strengths in automation, robotics, healthcare, data science and big data to fix broken areas in the healthcare system.

"I know patient safety is a key focus of the Jewish Healthcare Foundation and many of our institutions in today's healthcare systems. Medical errors are the result of system errors, not people errors. Today's healthcare system, unfortunately, creates an environment where good well-intentioned people can still make errors. And so, when you look at how we solve those kinds of problems long term, you need strengths and not only in health care but research, AI, automation, robotics, data science…and Pittsburgh's got such incredible strengths in all those areas. We're world renowned."

Of his pending retirement, Lunak said, "I've spent years being an entrepreneur, founder CEO and you know, while I have taken away so much from that, I also feel like I've sacrificed family and friends in the process. I'm really trying to spend more time with family and friends now and in retirement or semi-retirement."

Lunak said he is still involved with some companies either as a board member or in an advisory role adding, "If I can leverage some of my experience over the years to help somebody in some way, I get a lot of pleasure out of that."