In This Week's Issue
SSTI News and Analysis
Gov Announces $50M Innovation Strategy for Tennessee Regional
Jobs Plan
Hoping to capitalize on Tennessee's
"entrepreneurial spirit," Gov. Bill
Haslam today announced today a $50 million innovation strategy as
part of his regional jobs plan outlined last month. Named INCITE
for its focus on innovation, commercialization, investment,
technology and entrepreneurship, the initiative encompasses four
components, including:
- Innovation Coordination — The
Tennessee Department of Economic and Community Development (ECD)
will work with each of the nine regions to develop a strategic plan
for economic development based on the region's
unique assets. The governor said an innovation component will be
part of each of those plans.
- Commercialization — ECD will launch
new initiatives to help move products and technologies from the
research lab to the marketplace faster. The
governor's budget proposal includes $10 million
for the Memphis Research Consortium as part of this effort.
- Entrepreneurship — ECD will fund new
or existing business incubators in each of the
state's nine regions and create a statewide
incubator network to share best practices and support efforts to
raise capital.
- Co-Investment Funds — The state will
target $30 million toward the creation of early stage, seed, and
mezzanine capital co-investment funds. The funds will be designed
to be self-sustaining and to complement existing lending programs,
according to the governor's office.
The INCITE initiative is part of the
governor's Jobs4TN plan announced last month,
which seeks to create high-quality jobs through a regional approach
to economic development. The Jobs4TN plan also will prioritize
recruitment efforts on six target clusters in which the state has a
competitive advantage, including advanced manufacturing and energy
technologies.
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Maryland Budget Supports Tech and Biotech Industries
In support of Gov. Martin
O'Malley's Bio 2020
Initiative, lawmakers increased funding for stem cell research and
provided $8 million in tax credits for biotechnology investments in
the FY12 budget approved last month. Lawmakers also passed a bill
providing a two-year eligibility extension for companies using the
biotech tax credit and allocated $2.4 million to fund
nanobiotechnology projects.
The Maryland Technology Development Corporation (TEDCO) will
receive $15.7 million in FY12, up from $13.9 million approved last
year. This includes $12.4 million to administer the
state's stem cell research fund (a $2 million
increase) and $3.3 million for technology development, transfer and
commercialization.
The budget also includes the governor's
recommendation of $8 million for the biotechnology investment tax
credit awarded for investments in qualified biotechnology companies
and $3.8 million for the Maryland Biotech Center, which is
responsible for promoting the biotechnology industry and providing
resources for entrepreneurial programs. This reflects level funding
for both initiatives. Another $2.4 million is included for the
Maryland Industrial Development Financing Authority to develop in
coordination with TEDCO a competitive grants program for
nanobiotechnology research.
Lawmakers passed a bill during the session (HB 587)
that temporarily increases the age ceiling for biotechnology
companies applying for the Biotechnology Investment Tax Credit. The
new law will apply to a company active for up to 15 years, up from
the current 12-year limit, for fiscal years 2012 and
2013.
The InvestMaryland program (HB173),
as previously reported in the April
20, 2011 issue of the Digest, will invest at least $70
million in startup and early stage companies in Maryland following
passage by the legislature. The funding, which comes from
auctioning premium tax credits to insurance companies, will be
invested by private venture capital firms selected by the
state's Maryland Venture Fund and an independent
third party. The Maryland Venture Fund, founded in 1994, is
expected to receive about $18 million.
The FY12 enrolled operating budget bill is available at:
http://mlis.state.md.us/2011rs/bills/hb/hb0070e.pdf.
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Centers of Excellence, Entrepreneurship Grants Funded in
North Dakota Budget
Lawmakers last week passed the 2011-13 biennial budget,
providing $12 million for the state's Centers of
Research Excellence program. Although it is less than Gov. Jack
Dalrymple's request of $20 million to expand the
program and provide additional funding for three new centers, the
legislature's appropriation will allow for
continued investments in infrastructure and research capacity at a
time when many states are reducing funding for TBED to help fill
budget deficits. The approved budget also includes $1 million for
technology-based entrepreneurship grants and establishes a program
to provide matching grants for startup technology businesses.
The
budget bill for the Department of Commerce allocates $12
million for the Centers of Excellence over the biennium, down from
$19.5 million last biennium. Of this amount, $4 million is set
aside to advance a limited deployment-cooperative airspace project
with the state's research universities, with $2.7
million awarded to the University of North Dakota (UND) and $1.3
million awarded to North Dakota State University (NDSU). Another $4
million each will go to UND and NDSU; however, $3 million of
UND's funds must be used to establish and
administer a base realignment grant program. The
governor's plan to restructure the centers and
target additional funding toward three new centers focusing on
commercialization, entrepreneurship and workforce was not adopted
by the legislature (see the Dec. 15,
2010 issue of the Digest).
The budget bill also establishes a new program providing
matching funds for technology-based startup companies. The Small
Business Technology Investment Program will receive $1 million over
the next two years to provide grants of up to $50,000. The grants
require a 2:1 match from a North Dakota angel fund investment.
Another $1 million is included for technology-based
entrepreneurship grants, the same as last biennium.
Individuals representing government, business and education will
convene to conduct an assessment of the state's
current assets and resources and identify new opportunities for
economic growth and job creation through a new 2020 and Beyond
Initiative. The budget provides $50,000 to implement the
effort.
Lawmakers passed
HB 1057 during the session, a measure that updates the
state's pooled angel fund legislation to extend
eligibility to all pass-through entities and adds transferability
for out-of-state investors or in-state investors who do not have a
tax liability. The bill allows for pass-through entities such as
Sub-S, LLP, LLC, etc., to earn angel tax credits and pass them
through to the owner or member. It also creates an aggregate
taxpayer lifetime limit of angel credits to $150,000 and increases
from four years to seven years carry forward of unused tax credits.
The pooled angel tax credit was established in 2005.
A $1 million appropriation for STEM teacher education
enhancement funding is included within the $765 million
higher education budget. Following the budget agreement, the
Chancellor of the North Dakota University System will recommend
tuition limits set forth by the governor to freeze tuition for
community colleges and limit increases at four-year institutions to
2.5 percent, reports Inforum.
North Dakota is increasing general fund spending by 20 percent
over the next two years with larger projects financed by a fund for
oil surplus taxes, reports The Associated Press. The budget
approved by the legislature sets aside more than $1 billion in
reserves, including $618.6 million for the Legacy Fund approved by
voters in November to serve as a savings account for future
generations.
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NY Offers $140M To Spur University-Business
Collaborations
New York Gov Andrew Cuomo has announced the launch of the NYSUNY
2020 Challenge Grant Program. In its first phase, the program will
make $140 million available (up to $35 million per institution) to
SUNY University Centers in Albany, Binghamton, Buffalo and Stony
Brook for partnerships with the private sector. These partnerships
are intended to create new jobs and revitalize regional
economies.
Read Gov Cuomo's announcement...
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U.S. Trained Entrepreneurs See Greater Opportunities in
Homelands, According to Kauffman-Funded Study
Indian and Chinese immigrant professionals trained in the U.S.
are increasingly returning to their home countries with aspirations
of becoming entrepreneurs, according to the Grass is Indeed
Greener in India and China for Returnee Entrepreneurs
— a new report funded by the Kauffman
Foundation. Using survey data, the researchers found three
significant factors that draw both Indian and Chinese
entrepreneurs home including the availability of economic
opportunities (60 percent of Indian respondents; 90 percent of
Chinese respondents), local markets (50 percent of Indians; 78
percent of Chinese) and family ties (76 percent of Indians; 51
percent of Chinese). In contrast, respondents indicated that an
expired U.S. visa (9 percent of all respondents) did not factor
significantly into their decision. The authors provide two reasons for
this increasing trend:
- The Great Recession has diminished the professional
opportunities for immigrants.
- China and India have a competitive advantage due to lower
operation costs, lower salaries and better access to emerging
markets.
Only one U.S. advantage —
"salaries
received"— was found to
be a significant advantage compared to
respondents' native countries (64 percent of
Indians; 54 percent of Chinese). Many respondents
believe their salary would be higher had they remained in the U.S.
The authors contend that the U.S. must learn that supporting
entrepreneurial experimentation is necessary to compete in
today's global economy. Without this commitment,
entrepreneurs might choose to move to where the
"grass" is greener.
Read the report...
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Several States Have Potential to Exploit Their
Competitive Advantage, According
to New Report
A larger number of states are positioned to capitalize on rising
employment due to high-growth industries, according to a new report
from Wells Fargo's Economic Group
— Employment Dynamics and State
Competitiveness. These states (i.e., Georgia, North Carolina,
Arizona, Virginia and Texas) have been able to couple several
high-growth industries with a skilled workforce to build their
competitive advantage. The report utilized 20 years of employment
data in 25 major industries to project industries that are likely
to see high employment growth nationally, including finance &
insurance, professional & technical services, accommodation
& food services, other services and healthcare & social
assistance industries. The researchers also found that more than a
majority of states (more than 26) possess a competitive advantage
in at least 16 of the 25 industries. However, the effects of the
Great Recession may severely hinder some states' ability to
capitalize on their competitive advantage due to limited worker
mobility (e.g., Florida). The report advises policymakers to focus
on long-term workforce training programs and focus resources on
selected industries that maintain competitive advantages.
Read the report...
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Useful Stats
Share of Annual U.S. Venture Capital Investment by State,
2005-2010
Since 2005, the distribution of U.S. venture capital (VC)
investment has remained fairly steady, with California companies
receiving about half of all venture dollars.
California's share of total dollars reached its
highest point in 2009, when the state's firms
received 50.6 percent of all U.S. investment. While
California's share decreased a bit in 2010, VC
activity remains highly concentrated in a handful of states. Over
the past five years, the top ten states for venture investment have
represented about 85 percent of all U.S. venture activity. Since
PricewaterhouseCoopers began tracking VC activity by state in 2005,
the overall trend has been toward greater concentration in a few
hotspots, particularly the Silicon Valley region.
The number of venture capital deals also is highly concentrated
in California, though there has been a slight trend over the past
five years toward greater geographic diversity. In 2005, California
received 41.3 percent of all VC deals and the top ten states
together received 80.4 percent of all deals. Five years later in
2010, California received 39.3 percent of VC deals and the top ten
states received 78.9 percent of deals.
PricewaterhouseCoopers recently released their quarterly
MoneyTree report on Q1 2011. Overall, U.S. VC dollars were up five
percent over the previous quarter, reaching $5.9 billion, though
deals fell 11 percent to 827. California increased its share of
total U.S. investment in the first quarter, claiming 51.3 percent
of all VC dollars. The state's share of deals,
however, fell to 36.7 percent.
SSTI has prepared two tables: one showing each
state's share of annual U.S. venture capital and
another showing each state's share of venture
deals from 2005 to 2010.
SSTI also prepared the following chart showing the distribution
of venture capital investment dollars over the past five years.
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TBED People
TBED People
SSTI board members Rob Atkinson and Rebecca Bagley and SSTI member Stephen Tang were appointed to the U.S. Department of Commerce Innovation Advisory Board. The 15-member board will guide a study of U.S. economic competitiveness and innovation to help inform national policies.
Tom Thornton, who recently resigned as president and
chief executive of the Kansas Bioscience Authority, has joined
Cleveland
Clinic Innovations as its general manager of alliances.
North Dakota Gov. Jack Dalrymple named Alan Anderson to
head the North Dakota
Department of Commerce. Paul Govig has been serving as
the acting commissioner since December of last year when Shane
Goettle left the department. Govig will continue to serve as
deputy Commerce commissioner.
Lee Fisher, former Ohio lieutenant governor who also
served as director of the state's Department of
Development, has been named president and CEO of CEOs for Cities.
Harvard University announced that Gordon Jones will be
the inaugural director of the Harvard Innovation Lab, a $20
million community center for entrepreneurship that is slated to
open this fall.
Clemson University leaders John Kelly, George
Askew, and Bob Geolas were named to a new economic
development team linking agribusiness with the
South Carolina's other economic clusters.
Technology and life science incubator First Flight Venture Center has named
Andrew Schwab as its new president. Schwab has been serving
as the interim president since Executive Director John Draper
passed away last summer.
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Staff Picks
Startup America Offering Free Mentoring for Clean Tech
Entrepreneurs
Each entrepreneur will be matched with at least two experienced
business mentors specifically selected to address the
entrepreneur's business needs through this free
program.
Learn more...
Smart Grid Holds Promise for U.S. Job Creation
Duke University researchers estimate that U.S. suppliers for
smart grid technologies already have created more than 17,000 U.S.
jobs, but say additional policy support is needed.
Read more...
ITIF Report Urges National Manufacturing Strategy
ITIF argues that a healthy manufacturing sector is a key factor
in the health of the U.S. economy and a national strategy is needed
to reshape the industry.
Read the report...
Consumers Love of Green Products Fades as Recession
Lingers
While sales in most consumer-products categories have dropped
during the recession, an analysis shows certain green products have
fared even worse.
Read more...
BLS: Existing U.S. Businesses Shed Jobs Last Year
The Bureau of Labor Statistics reports a
disappointing decrease in gross job gains and an increase in gross
job losses in the third quarter of 2010.
Larger Firms Recovering Faster than Small Businesses
This Washington Post
article says small business growth remains unusually sluggish
as larger corporations are gaining steam. Experts say tougher
access to credit is standing in the way.
Entrepreneurship Bill Awaits Gov's Action
in Indiana
Passed with broad, bi-partisan support,
HB 1006 sets up a one-stop-shop for new businesses and requires
curriculum guides for high school entrepreneurship classes.
Road Back to Peak Revenue Long for Some States
Stateline has a graph
that shows the years between when state revenues peaked and when
they expect to reach that level again. For most states, it looks
like somewhere between 2012 and 2015.
New Census Data Indicates Women Outpacing Men in
Degrees
New data on educational attainment shows that among the employed
population aged 25 and older, 37 percent of women hold
bachelor's degrees compared with 35 percent of
men. State-level data is expected in September.
Read more...
Texas May Offer $10K Degrees
The Commissioner on Higher Education says the
governor's proposal isn't
such a crazy idea. The low-cost degrees would not be fit for
everyone and would not replace existing degrees.
Read more...
Mapping Innovation Hotspots
Find out
how Future.ly aims to map the state of innovation across the
world, from the people who are involved in new ideas to cutting-edge trends and research.
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