SSTI Digest

Governors in Massachusetts and Rhode Island have released details about their plans to boost innovative businesses in their respective states. Massachusetts Gov. Charlie Baker offered a strategic plan to guide his administration’s economic development efforts, with an emphasis placed on fostering a culture of innovation and entrepreneurship. Rhode Island Gov. Gina Raimondo announced the launch of three new incentive programs aimed at research-driven companies. Opportunities for All: The Baker-Polito Strategy and Plan for Making Massachusetts Great Everywhere avoids specific program recommendations, for the most part, but outlines a number of areas for action to boost the statewide economy. The administration notes that Massachusetts is a nationwide leader in educational attainment and innovation-related employment, but both business formation and job growth have fallen in recent years. New policies are needed to address the growing skills gap for middle-skill jobs and growing regional inequality. As the global economy pivots toward knowledge-intensive industries, the Baker administration perceives an opportunity for Massachusetts to leverage its advantages…

Since the establishment of the Tennessee Promise in 2014, the first statewide free community college effort, community college systems and states are outlining their own strategies to make a two-year education free for students in their region in attempt to create an educated, qualified workforce that addresses the needs of industry and promotes economic prosperity. While it may remain too early to judge the benefits and the costs of these programs – lawmakers and educational professionals remain divided on the issue.  In Wisconsin, Milwaukee Area Technical College (MATC) announced a plan to offer tuition-free enrollment to low-income, academically qualified high school seniors starting in the fall of 2016. Called the MATC Promise, the privately funded program is intended boost MATC’s enrollment and create a pathway to receive a college degree for students from families who otherwise could not afford to send their kids to college. In  exchange for MATC covering the difference between students' federal and state financial aid and the cost of tuition and fees, students will be required to perform at least eight hours of community service…

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...

Massachusetts is disproportionately affected by federal immigration policy, according to a recent report from the Mass Technology Leadership Council (MassTLC) – Growing 100K Tech Jobs: Trends, Insights, and Opportunities within the 2020 Challenge. The authors contend that the state’s universities and colleges educate a significant number of highly skilled immigrants from around the world in tech fields only to see them leave after graduation. Many of these immigrants help create economic value in regions across the country and world by launching startups and stimulating job growth. A primary cause of these international students leaving the state is national immigration policies that allow international companies to have advantage in competing for talent, according to the authors. MassTLC contends that the state and other groups within Massachusetts should continue to advocate for Congress to pass immigration reform. These findings were among several about how to reach the MassTLC goal of creating 100,000 new tech jobs from 2010 to 2020. Read the report… A recent report from the Manhattan Institute uses a review of academic literature and an…

Several governors released their proposed budgets over the last two weeks, and while some states continue to deal with budget shortfalls that prevent many new initiatives from coming into fruition, governors in Pennsylvania and North Carolina included numerous proposals focused on innovation and economic development. Additionally, governors in Louisiana and Massachusetts highlighted new workforce development proposals.  Pennsylvania Pennsylvania Gov. Tom Wolf’s proposed $33.8 billion fiscal year 2015-16 budget prioritizes strengthening the commonwealth’s middle class, allocating funds to a variety of workforce, economic development, and education initiatives. To enhance Pennsylvania’s business friendliness, Gov. Wolf proposes lowering the Corporate Net Income Tax (CNIT) from 9.99 percent to 5.99 percent, improving the commonwealth’s ranking from second-highest to fourteenth-lowest. For technology-based economic development, Gov. Wolf proposes an increase of $100 million for the Ben Franklin Technology Development Authority Fund, meant to support entrepreneurs, established companies, and manufacturing innovation. This increase would be…

Less than two months into 2015, Massachusetts and potentially Arizona will join the growing number of states that have adopted intrastate crowdfunding exemptions – one of the emerging trends in economic development from 2014.  In January, the Massachusetts Securities Division adopted a crowdfunding exemption that will allow businesses to raise up to $2 million in equity from both accredited and non-accredited investors.  A similar exemption was introduced in early February to both the Arizona state Senate and House with strong bipartisan support and the approval of several key business leaders and organizations. Minnesota (SF 138) and Colorado also have recently proposed or introduced intrastate crowdfunding legislation. However, both may face a difficult path to approval due to stronger opposition from key organizations and leaders within the state. MassachusettsIn January, the Massachusetts Securities Division adopted the Massachusetts Crowdfunding Exemption – 950 CMR 14.402(B)(13)(o). The new intrastate crowdfunding exemption will allow Massachusetts businesses to raise up to $1 million in funding during a one-year period without a financial…

Massachusetts remains the most tech-oriented state economy in the country, according to the latest edition of the annual Massachusetts Innovation Index. Nearly 38 percent of the state’s workforce is employed in tech industries, the highest share in the country, and Massachusetts generally outperforms other leading tech states in tech industry output, research and licensing. The MassTech Collaborative warns, however, that the state’s innovation economy is experiencing some of the same negative trends present in its peer tech states. Tech employment has rebounded at a slower rate than other types of employment and high school graduation rates have fallen. Download the report…

Over the last several years, universities have been forced to reimagine ways that they engage with alumni beyond the traditional method of fundraising via alumni donations. These universities and their alumni associations want to increase alumni involvement and facilitate interactions between their high-achieving alumni, faculty, and students. Over this same time span, many universities have increased the size and scope of their entrepreneurship curricula and degree programs. These two trends have started to merge as there has been a rise in the number of alumni angel networks that connect the talents and capital of alumni with faculty and students looking to launch an entrepreneurial venture. In 2012, approximately 40 alumni angel networks were affiliated directly with a university or alumni association. The number continues to grow as groups affiliated with Boston College, Dartmouth College, and Virginia Tech University recently launched angel networks that connect high-worth alumni with student-led startups.  University of Southern California (USC) alumni recently founded GenYrator, a for-profit equity crowdfunding platform to spur investment by accredited…

Three research-focused economic development organizations have released reports over the course of the last month detailing their progress in supporting economic growth, innovation, and beyond. The University of Massachusetts, the Georgia Research Alliance, and the Virginia Center for Innovative Technologies each use a different approach to measure their success and to communicate their impact to external stakeholders. The variety of releases demonstrates the range of approaches that organizations use to provide useful data in a format that attracts attention to their achievements. GRAThe Georgia Research Alliance uses an infographic to visually display their cumulative impact. According to the graphic, GRA’s annual economic impact is $825 million. This is comprised of $30 million directly spent by GRA to recruit talent, equip laboratories, seed promising startups companies, and support research, and is further leveraged by $395 million in direct spending by industry, universities, foundations and the federal government, with another $400 million in indirect spending that ripples across the state’s economy. GRA further supplements these quantitative…

On August 1, the Massachusetts lawmakers enacted a comprehensive economic development bill (H.4377). The bill currently awaits Gov. Deval Patrick’s approval. Per state law, Gov. Patrick has until August 14 to sign the bill, 10 days after he received it. The approved bill that received unanimous approval by the Massachusetts state Senate was passed as a comprise package between two bills proposed in the Senate and House. Through the bill, Massachusetts policymakers intend to invest more than $80 million to spur economic growth with a significant emphasis on strengthening Massachusetts’ innovation industries. Tech-based economic development efforts will focus on emerging industries, investments in workforce development and education, and promoting targeted regional growth. A major point of contention, language dealing with non-compete agreements, did not survive in the final bill. In the bill, policymakers place a significant emphasis on supporting tech startups and early-growth companies in emerging industries. Highlights include: $150 million for a program that would allow the pension fund (PRIM) to invest at least $150 million in institutions that make…

As the world becomes more globally connected, both public and private entities have turned their attention to foreign markets in the hopes of spurring innovation, capital creation, and economic prosperity. Whether their effort is developing international business partnerships, attempting to attract foreign direct investment (FDI), investing in startups, or taking advantage of international demand, the entities establishing these initiatives view long-term economic success for both firms and regions as dependent upon entering the global market place. Initiatives in Massachusetts, Pennsylvania, and Rhode Island are examples of public sector efforts that are looking for opportunities abroad to support economic growth. Massachusetts Gov. Deval Patrick recently announced the launch of the Universal Partnerships (UP) Program, a new state program to provide grants for the formation of R&D collaborations between Massachusetts companies and international life sciences organizations. Administered by the Massachusetts Life Sciences Center (MLSC), grants of up to $200,000 will be made to Massachusetts companies so they can engage in partnerships with foreign companies,…

Massachusetts continues to reign as the U.S. state best prepared to meet the challenges of the current and future global economy, according to the sixth edition of the Information Technology and Innovation Foundation’s (ITIF) State New Economy Index. The Index, which has been released periodically since 1999, ranks state economies using 25 indicators in five categories to evaluate the degree to which they are knowledge-based, entrepreneurial, globalized, IT-driven and innovation-based.  Delaware, California, Washington and Maryland round out the top five states. ITIF uses its 25 indicators to assign states an overall score and ranks them according to the preparedness for what it calls the New Economy. Massachusetts received the highest overall score of any state, as it has in all six editions of the Index since 1999. The group attributes Massachusetts’ perennial top rank to the state’s combination of world-class universities and high-concentration of tech-focused firms. Delaware took second place, as it did in the 2012 edition, due to its business-friendly policies and globalized financial sector. California ranks near the top in many areas,…