SSTI Digest

The 2017 SSTI Creating a Better Future Award provides the perfect opportunity to show other practitioners, as well as policymakers, the success you have achieved at creating a better future for your region through science, technology, innovation and entrepreneurship. To be eligible, submit a brief application that highlights one of your organization’s most successful initiatives. Award categories encompass research; entrepreneurship and capital; competitive industries and economic opportunity; and, recognition for the most promising initiative. Check out the categories and more information at sstiawards.org.

Visit our SSTI awards resources page for the call for applications, writing samples, and to listen to the information call.

Don’t delay – deadline for applications is May 26.

In part one of two, SSTI will examine NIH’s proposed changes that will place limits on individual researcher funding.

On May 2, the National Institutes of Health (NIH) announced that it intends to implement a new approach to grant funding with the purpose of increasing the number of researchers receiving grants. These proposed changes are due to a highly skewed distribution of NIH funding with 10 percent of NIH-funded investigators receiving over 40 percent of funding. NIH intends to roll out specific policies and procedures as part of the new approach – titled the Grant Support Index (GSI) – that will assess effectiveness of NIH research investments. During this time, NIH also will seek feedback from on how best to implement the individual grant funding limits.

On May 16 of last year, the Securities and Exchange Commission (SEC) finally allowed both accredited and non-accredited investors to engage in regulation crowdfunding. Under the new SEC rules, startups and other private companies could offer equity in return for capital to help support business growth. As of May 2017, total contributions under the regulation crowdfunding into startups and small businesses are over the $40 million mark with an average investment of $833 per investor. Using data from the Crowdfund Capital Advisors, Catherine Yushina from Crowdfund Insider highlighted several data points about the first year of regulation crowdfunding:

Adults in Tennessee seeking to return to the classroom will have a new option for free tuition at community colleges, part of an expansion of the Tennessee Promise scholarship program. The newly passed and expanded Tennessee Reconnect legislation extends eligibility for free tuition to persons who have been out of school for longer periods of time or who may have never attended college. It is part of Gov. Bill Haslam’s “Drive to 55” focus, where he hopes to increase the percentage of the state’s adults equipped with a college degree or certificate to 55 percent; it is currently closer to 30 percent in Tennessee.

In an unexpected twist, the FY 2017 budget passed earlier this month by Congress has more dislikes than likes for evidence-based program and policy design, despite being embraced strongly by both Presidents Donald Trump and Barack Obama. Masked under a variety of different nomenclatures – performance contracting, social impact bonds, pay for success, for example – evidence-based programming incorporates rigorous metrics to assess the effectiveness of public policy toward meeting its goals and basing expenditures accordingly. The largest initiative testing its merit in federal funding outlays was the Social Innovation Fund, housed within the Corporation for National and Community Service (CNCS). Congress eliminated the entire $54 million for the program, which had supported dozens of pay for success pilot programs across the country.

In the conference report that accompanied the final budget bill, Congress also chastised the U.S. Department of Education for applying pay for success principles without explicit approval from Congress:

In a market economy, what people are willing to pay determines something’s value. Airline tickets are a good example. For most of the major airlines, the price to purchase a seat the day of a flight seems to be some multiple of how much the airline thinks they can get away charging versus any drive to actually see the seat used. This supply-demand principle falls apart though with valuations set for startup companies funded by equity investors, such as angels or venture capitalists. In the risk capital business, a number of possible factors influences a startup company’s value – most tied to future markets, comparables, or dreams of big exits. Recent research from the University of British Columbia and Stanford University suggests just how surprisingly risky – and overly optimistic – this approach is.

The Economic Development Administration is seeking applications through June 23 for the 2017 Regional Innovation Strategies program. Through SSTI’s work with Congress, a record $17 million is available this year. Along with increased funding, the notice of funding availability includes a few changes from previous years. More information will also be available in a webinar SSTI is hosting with EDA on May 22 at 3 p.m. EDT.

EDA is providing two separate funding opportunities:

SSTI continues its reporting on actions taken by state legislatures to invest in economic growth through science, technology, innovation and entrepreneurship. This week, we look at the budgets passed and signed by governors in Iowa, New York and North Dakota, finding mostly level and some increased funding for innovation programs in Iowa and New York – including free tuition at in-state colleges for qualifying residents – while North Dakota is looking at decreased funding for programs.

The Kauffman Foundation released a new report analyzing entrepreneur development in St. Louis and Kansas City. Entrepreneurial Ecosystem Momentum and Maturity, The Important Role of Entrepreneur Development Organizations and Their Activities, by Ken Harrington, proposes a framework that names a four-step entrepreneur development process from problems and ideas to customer-funded venture that feeds into higher-stage venture development and, ultimately, economic development. Under this framework, Harrington explores how entrepreneurship is supported in each community by organizations such as KCSourceLink and BioSTL.

Every state and the District of Columbia experienced real GDP growth in the fourth quarter of 2016, according to the latest estimates released by the U.S. Bureau of Economic Analysis. The positive news means only energy-dependent Alaska, North Dakota and Wyoming saw real GDP fall over the year compared to the end of 2015. Experiencing growth of more than 5 percent between 2015 and 2016 were the District of Columbia, Nevada, Utah and Washington.

Could Jill Watson be the typical graduate assistant of the future? Watson was Georgia Tech’s first AI teaching assistant that fooled some in the computer science class into thinking the assistant they were dealing with in an online forum was human. New methods of teaching and training are being explored to handle the growing needs of filling middle-skilled jobs, according to several recently released reports. A new report from the Pew Research Center focuses on whether workers will be able to compete with artificial intelligence tools and whether capitalism itself will survive. Two other reports released last month by the National Skills Coalition stress workforce training through work-based learning policy and surveys all the states for the effectiveness of such programs, and provides policy recommendations by revisiting a November report. The new Pew report, The Future of Jobs and Jobs Training, begins by asserting that “massive numbers of jobs are at risk” as smart, autonomous systems continue to infiltrate the workplace. Solutions evolving from conversations surrounding the topic include changes in educational learning environments to help people stay employable in the future, the report says.

On April 27, Federal Communications Commission (FCC) Chairman Ajit Pai released a Notice of Proposed Rulemaking (NPRM) that would impact net neutrality in the U.S.. The Restoring Internet Freedom act, which will be voted on at the May 18 FCC meeting, would end the utility-style regulatory approach intended to preserve net neutrality. Pai’s office contends that the FCC 2015 decision to subject internet service providers (ISPs) to Title II utility style regulations reduces the incentive for innovation in the industry and threatens the open Internet it is purported to preserve.