SSTI Digest

Part two of a 3-part series: Part one, Part three

This week, the U.S. Department of Commerce’s Economic Development Administration (EDA) announced approximately $5 million in total funding for the 12 recipients of the 2014 Science and Research Park Development Grants, used for feasibility and planning for the construction or renovation of science or research parks. These grants, alongside i6 Challenge grants and Cluster Grants for Seed Capital Funds, comprise the EDA’s Office of Innovation and Entrepreneurship’s (OIE) Regional Innovation Strategies (RIS) program, an initiative designed to advance innovation and capacity-building activities in regions across the country. Additional information on the 2014 Regional Innovation Strategies program competition awardees can be found here.

The 2014 Science and Research Park Development Grant awardees include:

In 2014, 25 percent of all angel investments supported seed and startup stage businesses, down from 45 percent in 2013, according to the year-end report by the University of New Hampshire's Center for Venture Research. Angels, however, remain a key group in early stage financing, participating in 46 percent of all early stage deals. Angels invested $24.1 billion in 2014, down 2.6 percent from the previous year, though both the number of investors and the number of angel capital recipients had modest increases. Read the full report...

Over the past few months, SSTI has followed proposals issued by governors in their budget requests, State of the State Addresses, Inaugural Speeches and other events. Now that many state legislatures have begun approving budgets, the SSTI Digest will check on the status of these proposals, and examine the state of technology-based economic development funding in the states. This week, we review actions in Tennesse and Nebraska.

TennesseeGovernor Bill Haslam signed a $33.8 billion FY16 budget (HB 1375) without the $2.8 billion the governor had proposed for the Insure Tennessee health insurance program. The budget, however, does provide $114.8 million for the Department of Economic and Community Development (DECD), including $30 million for TNInvestco tax credits. Within the DECD budget, Business Development programs are allocated $10.8 million from the state's operating budget, while Innovation Programs would receive $237,000.

Funding obligated by federal agencies for research and development (R&D) and R&D plant (facilities and fixed equipment) dropped from $141 billion to $127 billion (9 percent decrease) in current dollars from FY12 to FY13, according to a new National Science Foundation (NSF) InfoBrief. NSF researchers found that federal funding for research dropped by 4 percent; support for development efforts dropped by 14 percent; and, R&D plant funds were reduced by 11 percent. They also found that basic research saw a decline of 4 percent ($1 billion in current dollars) and applied research saw a decline of 5 percent ($2 billion). A $10 billion reduction (14 percent decrease in funding) in R&D and R&D plant obligations by the Department of Defense was the driving force behind the overall drop in federal funding. However, the Department of Health and Human Services ($2 billion decrease), NASA ($293 million decrease), NSF ($214 million), and the Department of Energy ($111 million) also reported reductions in their obligations for R&D and R&D plant funding.

The Canadian Securities Administrators (CSA) announced that securities regulators in five Canadian Provinces have agreed to CSA Notice 45-316 – a common set of rules that will allow startups to raise up to $500,000 CD (approximately $401,600 USD) per year from unaccredited investors via authorized Canadian-based funding portals. With the passage of the new rules, the provinces of British Columbia, Manitoba, Québec, New Brunswick and Nova Scotia join Saskatchewan as provinces that allow non-accredited investors to make equity investments in startups and other small businesses, according to techvibes.com.

Part one of a three part series: Part two, Part three

Innovation in the United States, once a hallmark of economic success, finds itself resting on an increasingly weak foundation, according to an article in The New York Times.  The author, Eduardo Porter, suggests that two trends – increased international competition and a stagnant R&D-to-GDP ratio – pose key challenges for the U.S. First, government funding for basic research continues to fall and is politically vulnerable. Second, evidence suggests that American corporations are walking away from basic science as well. Each of these challenges, Porter notes, bodes poorly for American progress.   

Yesterday, the U.S. House Appropriations Committee approved a Commerce, Justice and Science appropriations bill that includes $11 million in funding for the Regional Innovation Program.  This action marks the first time the House bill has included funding for the program. The Regional Innovation Program is SSTI’s top legislative priority. SSTI thanks all who have expressed support for the program. The Digest will report more when the full House acts and the Senate proposal is released.

Massachusetts needs an advanced manufacturing strategy, preferably one based on regional public-private consortia, according to a new report from the MIT Industrial Performance Center. In Strengthening the Innovation Ecosystem for Advanced Manufacturing: Pathways & Opportunities for Massachusetts, the group recommends that the state look to the federal Institutes of Manufacturing Innovation to develop its own manufacturing infrastructure. The state could also benefit from a systematic effort to inform startups about the early stage prototyping and piloting capabilities of small manufacturers. Read the report...

Business owners felt overwhelmingly optimistic about the future, as over 80 percent of them predicted their revenues would increase over the next three months and that financial conditions would be better as well, according to a new survey from Thumbtack.com and Bloomberg  Professional Service.  The Thumbtack Small Business Sentiment Survey captures the economic sentiment of more than 10,000 small businesses nationwide on a monthly basis by surveying both owners and employees of those businesses.  Other findings include:

While there has been a significant amount of focus on identifying and cultivating academic entrepreneurs, two recent studies indicate that the environmental factors are equally important in the commercialization of academic research. These studies find that the commercialization approach of the tech transfer offices (TTOs) and institutional characteristics were vital in the success of academic research commercialization.

In a recent study from the University of Sussex (UK), Dagmar Weckowska examines most common types of tech transfer approaches used by UK TTOs. Weckowska found that most UK tech transfer offices employ two common approaches to commercialization: transactions-focused practice and relations-focused practice. Weckowska characterized transactions-focused commercialization practice as the treatment of outputs of scientific research as tradable products and is focused on completing IP transactions, such as sales and licenses. In contrast, relations-focused commercialization practice is focused on building relations among academics, commercial organizations, and university TT managers.

U.S consumers are subject to a high degree of income volatility and have insufficient savings to overcome shortfalls in their budgets, according to the inaugural report of the JPMorgan Chase Institute. Because of the mismatch between income volatility and consumer spending habits, the authors suggest there is ample room for innovation in the market for companies that help consumers with medium-term financial decisionmaking. The Institute plans to use its access to proprietary data in future report to inform policymakers on topics related to the economy and business. Learn more...