In the December 20, 2004 Issue:

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Texas Gov. Requests $300M for New TBED Effort
Gov. Rick Perry is asking the Texas Legislature to appropriate $300 million for a new program designed to foster emerging technologies, enhance university-industry collaboration, and promote technology commercialization. If approved, the multi-faceted effort would be the most aggressive tech-based economic development initiative in the state's history.

"Texas must now take the next step of investing more in emerging fields of technology in order to remain competitive in the evolving world economy," said Gov. Perry.

The proposed Texas Emerging Technology Fund, if funded, would focus on research and job creation in high-tech industries such as semiconductor manufacturing, biotechnology, nanotechnology, environmental sciences and advanced energy. Most of the funds would benefit Texas colleges and universities and would be divided into three components, which include:

The idea for the fund stems from the Governor's Council on Science and Biotechnology Development, which was charged in 2002 with recommending a course of action for emerging science and technology fields.

In addition to his request for funding to support the Emerging Technology Fund, Gov. Perry also asked the legislature to approve an additional $300 million to replenish and enlarge the Texas Enterprise Fund. Created in 2003 with an $295 million appropriation from the state's rainy day fund, the Enterprise Fund is used at the governor's discretion to lure jobs to the state. To date, $180 million of the incentive/inducement account has been allocated to various projects, leaving a balance of $115 million prior to any new appropriations.

More information is available from the governor's website at: http://www.governor.state.tx.us/

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VC Investments in China Top $1B in 2004
Premier wants tech zones established to encourage even more growth

Money is following the jobs and excitement that represents China's economy these days according to an annual survey of equity investments in China mainland businesses. Compiled by Chinese venture capital (VC) research and consulting firm Zero2IPO, the fourth annual survey found 60 firms made 253 investments totalling $1.269 billion (US) in China mainland or mainland-related enterprises in 2004.

The rapid growth in the world's fascination with all things Chinese also is evident by the number of deals increasing more than 43 percent over last year. The survey results mark the first time the total has surpassed $1 billion, with total funds increasing by 28 percent over the prior year.

According to Zero2IPO, the Information and Computer (IC) industry received the bulk of the investments, reporting $424 million with a primary focus on IC design. Telecommunication firms captured 12 percent of the total, while 14 percent was invested in firms in the "traditional" industry sector. The Shanghai region received the greatest number of deals and highest investment amount, followed by Beijing.

The Chinese innovation phenomenon is likely to become more geographically concentrated to a certain degree as the nation looks to expand its version of cluster development. According to People's Daily Online last week, Chinese Premier Wen Jiabao voiced his support of national economic and technological development zones, saying the zones should move ahead in a scientific way by focusing more on restructuring, technological innovation, and making better use of the land. Vice Premier Wu Yi also praised the zones' role in developing industrial projects, attracting foreign investment, pushing up export and developing high-tech industries over the last 20 years, the article contends.

The Vice Premier is pushing for the zones to become multi-functional industrial zones through four transformations, according to the article. Her recommendations include changing from developing modern manufacturing to covering international service outsourcing; shifting from a focus on scale economy to quality economy; moving from technology introduction to innovation; and basing the zones on advantages of structure and overall environment instead of relying on policy environment.

The China Venture Capital Annual Report 2004 is expected to be available for purchase through Zero2IPO at: http://www.zero2ipo.com.cn/en/

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Panel Says NASA Should Rethink Tech Transfer Approach
Four consecutive years of attempting to eliminate or minimize NASA's technology transfer activities are beginning to take a toll on the space agency's effectiveness at commercializing federally-supported technology, based on analysis from the National Academy of Public Administration (NAPA).

Technology Transfer: Bringing Innovation to NASA and the Nation concludes organizational changes, budget difficulties, and a significant increase in privately funded research and development (R&D) nationally are hindrances for NASA in its technology transfer efforts. Technology transfer should be a core element of NASA's mission, but an overall lack of program focus requires the agency to rethink how it administers the function, a panel of experts states in the NAPA report.

The panel found the agency's current system is not structured to meet its needs, nor those of stakeholder and public expectations. The Innovative Partnerships Program (IPP), which manages NASA's network of six Regional Technology Transfer Centers (RTTCs) and the National Technology Transfer Center (NTTC), shifted in 2004 its focus from commercializing NASA technology to bringing in private sector technology. This shift, the panel says, requires different approaches and skills.

Congress apparently was of the same opinion regarding IPP's shift of focus, as it completed the 2005 omnibus appropriations bill; the Dec. 8 issue of National Journal's Tech Daily cites language from the budget conference report stating Congress "[does] not agree with the termination of the commercial programs within the Innovative Technology Transfer Partnerships program as proposed in the budget submission, and have therefore provided an increase of $30 million to this appropriation for the express purpose of continuing the commercial programs."

The NAPA panel states its "fundamental conclusion is that technology transfer (at NASA) is destined to fail so long as it is viewed solely as the responsibility of an isolated group of IPP officials." To help the agency reach its technology transfer goals, the panel recommends NASA undertake five steps:

NAPA is a nonprofit organization chartered by Congress to provide advice to leaders on issues of management and governance.

Technology Transfer: Bringing Innovation to NASA and the Nation is available at http://www.napawash.org/transfer.

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Useful Stats: NSF State S&E Profiles 2001-2003
The National Science Foundation (NSF) has updated its online center of state science and engineering (S&E) profiles to include data from 2001-2003. The site provides convenient access to a PDF or downloadable Microsoft Excel Worksheet of 31 indicators for each state. A spreadsheet with summary statistics for the entire U.S. also is available.

The profiles present dollar amounts and rankings for federal R&D obligations for 2002 by agency and performer for each state. Information included in each profile is compiled from several federal agencies, including NSF, the Small Business Administration, and the departments of Commerce, Education and Labor.

State S&E Profiles 2001-2003 is available at: http://www.nsf.gov/sbe/srs/nsf05301/start.htm

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Nurturing Creative Economy Key to Growth in Vermont
This past fall, Vermont released what may be the nation's first statewide effort to lay out an economic development strategy based on the creative economy theories advanced most prominently by George Mason professor Richard Florida. Advancing Vermont's Creative Economy, prepared by the Vermont Council on Culture and Innovation (VCCI), offers recommendations that include collaboration among government entities, cultural organizations, and the private sector that utilizes cultural resources.

Developers, venture capitalists, policymakers, and educators recognize the tremendous growth potential in the emerging creative economy, according to VCCI, and Vermont can capitalize on its strengths and systematic support in this sector. The report offers examples of social and economic benefits to investing in the arts and culture, and makes specific recommendations on how to grow the state's creative economy.

In tracking the creative economy and assessing its value to the state, VCCI held six public forums around the state, participated in panel discussions and workshops, and administered written surveys. According to VCCI's findings, communities with thriving cultural centers are more likely to attract businesses and entrepreneurs than those that do not. The following recommendations are offered for the governor's administration, the legislature, and private and public partners:

Just as Vermont was once a leader in the manufacturing of things, it is now poised to be a leader in the production of ideas, the report contends. The state lost 8,100 manufacturing jobs between 2001 and 2003, while between 1997 and 2001, the state had the fastest growth rate in creative cluster employment in the New England region. A key observation of the report's findings is strengthening the creative sector will take a long-term and incremental effort, but pressing needs must be addressed in order to assure its future competitiveness.

Advancing Vermont's Creative Economy is produced by the Vermont Council on Rural Development and is available from the Vermont Arts Council at: http://www.vermontartscouncil.org

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Incubator News

NBIA Releases Revised Business Incubation Guide
The National Business Incubation Association (NBIA) last week released an updated version of its business incubation manual. The revised second edition of A Comprehensive Guide to Business Incubation includes 71 chapters geared toward helping small businesses grow and offers the advice of more than 200 incubation professionals. The guide is divided into four main sections: fundamentals of incubator development, best practices in incubator management, working with clients, and special topics in business incubation. To purchase a copy, visit the NBIA online bookstore at http://www.nbia.org/store.

Albany, N.Y.
Officials looking to convert an empty Department of Transportation building in Albany, N.Y., into a business incubator are hopeful it will bring 8,000 scientists, researchers and office workers in 20 years, according to a Times Union story. Located at the W. Averell Harriman State Office Campus, the building features 133,000 sq. ft. for prospective tenants. The managing board overseeing the campus's transformation to a tech park for private companies are considering leases for four tenants, likely to come from the University of Albany.

Hilo, Hawai'i
Five years after the donation of a Bank of Hawaii building and proponents are beaming over the prospects of finally bringing tech-based companies to the Big Island. The Hononulu Advertiser reports the Hawai'i Innovation Center opened late last month at Hilo, a former branch of the bank. The small business incubator is a reality, thanks in part to $2.75 million in state and federal money spent by the University of Hawai'i-Hilo. The High Technology Development Corp. will manage the 8,000-square-foot incubator, which can situate up to nine start-up businesses.

Milwaukee
The IT Fusion Business Center, Milwaukee's first business incubator, was started earlier this month with help from the mayor's office and Towne Investments and Kuhlfusion LLC, according to the Daily Reporter. The center, which has 6,000 sq. ft. available for office space, reportedly offers a range of communications and data services. Contracts with three or four companies - nearly all of which were of the IT field - were in progress when the Daily Reporter ran its story. Center proponents also hope to attract medical imaging software companies and other tech firms.

San Diego
A creativity center planned for the San Diego region could be the key to overcoming the area's struggling manufacturing jobs situation, a North County Times article suggests. The center will tap the resources of Cal State San Marcos toward the goal of nurturing businesses with high-value, high-paying jobs. Although no physical location has been set for the center, plans are underway for the center to be digitally connected to local city libraries. Supported by the San Diego North Economic Development Council, the center is expected to open in early 2005.

Syracuse, N.Y.
A biotech company will be the first occupant of the newly opened Syracuse Technology Garden, the Post-Standard reported last week. Plant Defense Boosters, Inc. will be among those young technology companies benefiting from the 32,000-square-foot facility. The center was built with $3.25 million in federal, state and local funding. All occupants will have, among other services, easy access to NASA's Space Alliance Technology Outreach Program and some free technical assistance provided by NASA contractors therein. The program, which helped start the center with a $1 million grant, will join Plant Defense Boosters as one of the first tenants.

SSTI spotted at least nine other instances of incubators either recently opening or in progress:

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People

Virginia Bauer, former New Jersey commerce secretary, was sworn in as CEO and secretary of the New Jersey Commerce & Economic Growth Commission.

The Greater Phoenix Economic Council announced Barry Broome will become the new president & CEO beginning in February.

Michael DeAloia has been named tech czar for the City of Cleveland.

Marlo Jenkins will be the new managing director of TechTown, Wayne State University's research and technology park.

The Board of Directors of BioCrossroads, Indiana's life sciences initiative, announced David Johnson would succeed Charles Schalliol as CEO.

Real estate developer Robert Klein II was selected as chairman of California's stem cell oversight committee.

John Merrill will serve as executive director for the Greensboro Center for Innovative Development, a joint millennium campus and research park between University of North Carolina Greensboro and North Carolina Agricultural and Technical State University.

Eric Mittelstadt will become the new CEO of the National Council for Advanced Manufacturing. He replaces founder and current CEO, Leo Reddy.

Wisconsin commerce secretary Cory Nettles is resigning his position and will join his old law firm as a partner.

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SSTI Takes Holiday Break
For all intents and purposes, the SSTI offices will be closed from Dec. 24 - Jan. 3 (although some of us retain the right to stop back into the office for respite when either the in-laws, urchins or eggnog get to be a little much). Next week, SSTI will be switching to a new webhost and, while we do not anticipate any problems, e-mail service may be temporarily interrupted or unavailable. We apologize for any inconvenience this may cause.

Publication of SSTI's Weekly Digest and Funding Supplement will resume with the Jan. 10 issue.

The staff at SSTI hopes each of our readers is enjoying a wonderful holiday season!

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