• 2008 Excellence In TBED Winners Honored For Achievement In Building Tech-Based Economies
• EU Promises $1.28 Billion for Hydrogen and Fuel Cell Initiative
• Exits Becoming Scarce on VC Highway
• New Initiatives in Wisconsin and Ohio Feature Specialized Life Science Pushes
• NSF Awards $92.5M for Five New Engineering Research Centers
• SSTI Job Corner

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• Maryland Technology Transfer Fund - Commercializing Research Category
  A program of the Maryland Technology Development Corporation (TEDCO), the Maryland Technology Transfer Fund supports product development in early-stage companies by providing funds to defray the cost of R&D activities and push company technology to the threshold of commercialization making the company attractive for follow-on funding. Since 2002, 114 companies that have been supported through the Maryland Technology Transfer Fund have completed their projects. With an investment of $6.8 million by TEDCO these companies have gone on to receive downstream funding nearing $205 million. This is a 30:1leverage for the state's investment.
• SC Launch! – Building Entrepreneurial Capacity Category
  Created to strengthen South Carolina’s knowledge economy by creating high-wage earning jobs, SC Launch! accelerates the entrepreneurial growth for advanced technology start-up companies by delivering key tools for success, including seed funding, project development funds, and ongoing mentoring and business counseling. Through its university pre-company initiative support program, an SBIR/STTR matching grant program, and funding to start-up companies, SC Launch! is involved in each step of the innovation pipeline. Since its inception in 2006, $50 million in follow-on funding has been secured by SC Launch! Portfolio Companies with 85 companies accepted into the program.
• Innovation Works Seed Fund – Increasing Access to Capital Category
  Launched in October 1999, the Innovation Works seed fund is the primary investment program of Innovation Works, the Ben Franklin Technology Center for Southwestern Pennsylvania. In the nine years since its inception, the Innovation Works Seed Fund has become the largest and most active source of seed funding in the Pittsburgh region, investing roughly $40 million in over 110 startup technology companies.  As of September 2008, these companies have attracted more than $500 million in additional follow-on funding, and currently employ more than 1,500 people.
• Connecticut’s Center for Advanced Technology Manufacturing Supply Chain Integration – Improving Competitiveness of Existing Industries Category
  The Connecticut Center for Manufacturing Supply Chain Integration was established by the Connecticut Center for Advanced Technology in 2005 to promote supply chain development and integration and to stimulate process improvement at small and medium-sized manufacturers in the aerospace and defense sector. To date, 175 process improvement projects have decreased lead time, cycle time and changeover time, and increased quality levels and space utilization allowing companies to take on new business, adding 198 high-wage jobs to the Connecticut economy.

EU Promises $1.28 Billion for Hydrogen and Fuel Cell Initiative
Bank bailouts may be capturing all of the headlines, but a new initiative from the European Union (EU) promises to inject a considerable pool of money during the downturn to accelerate the development of hydrogen and fuel cell technologies. The European Commission, as well as participants from the European research community and industry will contribute nearly 1 billion Euros (U.S. $1.28 billion) to the public-private partnership over the next six years to fund research. Stakeholders believe that this effort will help speed the commercialization of hydrogen and fuel cell technologies by two to five years, and are hoping for a mass-market rollout of these technologies before 2020.

The Fuel Cells and Hydrogen Joint Technology Initiative (JTI) is one of five JTIs launched by the EU over the last year in strategic fields of industrial research. The others address technological and economic goals including reducing time-to-market for new medicines, lowering the carbon impact of air transportation, improving complex computer systems, and implementing nanoelectronic research projects. These initiatives are led by non-profits representing the interests of industry stakeholders, which the EU hopes will help deliver timely and beneficial results for the European economy. The Fuel Cell and Hydrogen JTI industry group includes members from 66 companies including Fiat and Volvo from the automotive sector, and Total and Shell from the energy sector. 

The initiative is intended to help support research that is often so complex that it cannot be undertaken by a single company or research intuition. It will also help companies tap into the research capabilities of European universities. The JTI will implement the program by funding research proposals, and has already made its first round of requests.

For more information, visit: http://europa.eu/rapid/pressReleasesAction.do?reference=IP/08/1498&format=HTML&aged=0&language=EN&guiLanguage=en

Exits Becoming Scarce on VC Highway
Still no sign of improvement as the U.S. enters the third quarter of its initial public offering (IPO) drought.  Just one venture-backed company made an IPO exit in the third quarter of 2008, according to a release from Thomson Reuters and the National Venture Capital Association (NVCA). Mergers and acquisitions (M&As) also were down 43 percent from the same quarter last year. NVCA explains that this slowdown is attributable to both the crisis in the financial markets and to a longer-term reduction in the number of exits. If this trend continues, they warn that capital could become scarce for companies seeking first time investments.

Since the beginning of the calendar year, which coincides with the start of the drought cited by NVCA, there have been only six venture-backed IPOs and 199 M&As. By this same time last year, 55 venture-backed companies had made an IPO and 271 had been acquired. Many later-stage venture-backed companies are choosing to delay an IPO exit until market conditions improve. Similarly, larger corporations are postponing merger and acquisition activity in the near-term. 

Mark Heesen, president of NVCA, believes that if this situation continues into 2009, entrepreneurs can expect capital to become more difficult to secure. Venture firms would have to spend more capital and other resources maintaining the late-stage companies in their portfolio still waiting for an exit. 

Fund-raising also has begun to slow, with a 29 percent reduction in the number of funds raised from the same quarter last year. The dollar value of these funds was down six percent to $8.1 billion. The industry appears to be continuing a trend toward a smaller number of funds, but those funds that remain will be larger on average than they are now.

Investments, however, are not yet showing signs of decline. Venture firms invested $7.1 billion in the third quarter, about the same as the third quarter of 2007. Seed- and early-stage companies continued to represent just under forty percent of total deals. Heesen notes that this round of investments did not yet reflect the global financial crisis, which could lead to less activity in the next quarter and early next year.

For more information about the IPO drought, visit: http://www.nvca.org/pdf/Q308ExitpollFINAL.pdf

New Initiatives in Wisconsin and Ohio Feature Specialized Life Science Pushes
For several years governors across the country have announced life science and biotech initiatives that are as broad as they are large. The devil is in the details, and in most cases related to bio-based economic development, so are the opportunities. Participants in SSTI’s 12th annual conference last week were reminded targeted investments in specialized areas related to merging existing life science and other technological strengths in a region are likely to have the greatest economic impact.

Over the past few weeks, two new initiatives were announced – one in Northeast Ohio and one in Wisconsin – highlighting more focused approaches to building research and commercialization capabilities within multiple industries through advances in the life sciences.

The partners forming the BioInnovation Institute at Akron have committed in aggregate more than $80 million to create various research, education, and commercialization projects based upon the intersections of materials science and biotechnology. These projects will include the Orthopedic Research Institute of Northeastern Ohio, the Center for Biomaterials and Medicine at the University of Akron, a medical device concept laboratory, and centers for health care training and clinical trials.

The BioInnovation Institute at Akron was pushed forward by a collection of organizations, including private companies, educational institutions, and local hospitals. The main contributions include:

• $20 million from The John S. and James L. Knight Foundation;
• $20 million from the state of Ohio, especially through its Third Frontier grants;
• $10 million from the utility provider, FirstEnergy Corp.; and,
• $4 million each from Akron Children’s Hospital, Akron General Health System, Northeastern Ohio Universities Colleges of Medicine and Pharmacy (NEOUCOM), Summa Health System, and the University of Akron.
  

The Wisconsin Genomic Initiative (WGI) is the first project originating from Governor Jim Doyle’s proposed Wisconsin Medial Research Triangle, a collaboration of four in-state health care institutions – the University of Wisconsin School of Medicine and Public Health, the Medical College of Wisconsin, the University of Wisconsin-Milwaukee, and the Marshfield Clinic. The collaboration includes the largest population-based genetic research project in the U.S., collecting the DNA and medical records of 20,000 individuals.

WGI’s focus will be to improve personalized health care research, examining genetic factors for a patient’s risk of developing specific diseases, and subsequently creating personalized treatment for the illness. The first phase of the Initiative includes a focus on diabetes, obesity, and cardiovascular disease, as well as identifying one million relevant genetic markers for these targeted health problems.

Additional information about the BioInnovation Institute at Akron can be found at:
http://www.bioinnovationinstitute.org/

A press release by Gov. Doyle’s Office on the Wisconsin Genomics Initiative can be found at: http://www.wisgov.state.wi.us/journal_media_detail.asp?locid=19&prid=3752

• NSF ERC for Biorenewable Chemicals - Based at Iowa State University, the center will develop technologies to transform the petroleum-based chemical industry into an industry based on plants and other biorenewables. Iowa State University has committed $600,000 per year for the center.
• NSF ERC for Future Renewable Electric Energy Delivery and Management – Based at North Carolina State University, the center will develop technology that transforms the nation’s centralized power grid into an alternative-energy-friendly “smart grid” that stores and distributes energy produced from solar panels, wind farms, fuel cells and other energy resources. An additional $10 million has been secured through institutional support and industry membership fees.
• NSF ERC for Integrated Access Networks – Based at the University of Arizona, the center will develop optoelectronic technologies for high-bandwidth, low-cost, widespread access networks. Over the next decade, the center will devise and adapt chip-scale optoelectronic integration technologies capable of delivering data at 10 gigabits, or 10 billion operations per second.
• NSF ERC for Revolutionizing Metallic Biomaterials – Based at North Carolina Agricultural and Technical State University, the center will transform medical and surgical treatments by creating “smart” implants for craniofacial, dental, orthopedic and cardiovascular interventions.  The center is the first historically black institution to be chosen to lead an ERC.
• NSF Smart Lighting ERC – Based at Rensselaer Polytechnic Institute (RPI), the center will create new solid-state lighting technologies to enable rapid biological imaging, novel modes of communication, efficient displays and safer transportation. The state has committed $700,000 to the center’s first year, with additional funding of nearly $1 million expected from industrial partners and $500,000 from RPI.

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