SSTI Digest

After two years of stagnancy, venture-backed company exits improved dramatically in 2010, according to the National Venture Capital Association (NVCA). The increase was driven by a record-breaking market for acquisitions and the best quarter for initial public offerings (IPOs) in ten years. NVCA attributes the uptick in IPOs to a surge in Chinese venture-backed companies going public on U.S. exchanges. A recent NVCA/Dow Jones VentureSource survey finds that most venture capitalists (VCs) and venture-backed CEOs expect exits to continue their upward swing and that venture investments will grow in the coming year.

Connecticut has certified its first fund manager under the state's revised Insurance Reinvestment Tax Credit program, which has now expanded beyond its focus on insurance-related companies to support early stage and high-tech firms. Advantage Capital Partners has raised $72 million to invest under the revamped program. Fund managers may invest in any Connecticut-based business. One quarter of the investments must support green technology firms, and three percent must go toward pre-seed stage projects. Read Governor Joni Rell's press release ...

In "Advantage: How American Innovation can Overcome the Asian Challenge," Adam Segal contends the U.S. will continue to maintain a comparative advantage in innovation over Asia due to the "software" of innovation. The "software" of innovation revolves around the political social and institutional factors that move ideas from the lab to the market place. America's cultural values of individualism, social mobility, entrepreneurship, limited barriers to market access and low risk-aversion provide it a significant advantage over our Asian competitors. It is necessary to leverage and continue to cultivate the U.S. "software" of innovation because Asia's science and technology sectors (S&T), specifically China and India, are rapidly catching up to and should overtake the U.S. in several areas including the number of Ph.D.s awarded, investments in product innovation, number of patents obtained and facilities — Segal terms these quantifiable factors as the "hardware" of innovation. Segal, a senior fellow at the Council on Foreign Relations, argues that this decline in the U.S.

SSTI Board member Phillip Singerman has been named as the Associate Director for Innovation and Industry Services for the National Institute of Standards and Technology. He will assume this position on January 31.

Alabama Gov.-elect Robert Bentley named former house speaker Seth Hammett as the director of the Alabama Development Office.

Colorado Gov. Bill Ritter announced he will become director of the Center for the New Energy Economy at Colorado State University effective Feb. 1.

Michigan Gov. Rick Snyder named Michael Finney, current president and CEO of Ann Arbor SPARK, as the new Michigan Economic Development Corp. director, replacing Greg Main. Ann Arbor SPARK announced the appointment of Skip Simms as interim president and CEO.

With an overall projected reserve of about $1.2 billion at the end of the 2011-13 biennium, North Dakota is well positioned to invest in growing economic sectors during a time when most states across the country are cutting programs to fill massive budget deficits. Gov. Jack Dalrymple outlined a budget for the next two years that would capitalize on the state's institutions of higher education and energy industry. Proposals include extending the Centers of Excellence program with an additional $20 million, establishing an Office of Energy Development to focus on the state's growing energy sector, and increasing funding for higher education to hold down tuition.

The governor wants to restructure the state's highly successful Centers of Excellence program by targeting additional funding toward three new centers. In total, $20 million is proposed for the centers, which includes $5 million in carryover funding from current unexpended appropriations. New investments include:

The National Institutes of Health (NIH) is seeking input from the public and NIH staff on the proposed creation of a new center that would support translational science and consolidate several existing translational research programs. The National Center for Advancing Translations Sciences (NCATS) would support the development of therapeutics and clinical care from basic research discoveries. Charged with streamlining NIH's structure, the Scientific Management Review Board (SMRB) recommended establishing NCATS to house a number of NIH programs that could collaborate to decrease the risks involved in private drug and therapeutic development projects. Skeptics at a recent SMRB meeting expressed concern that the restructuring might endanger current NIH programs.

U.S. students perform just slightly above or below average in the three categories (reading, math and science) of the Programme for International Student Assessment (PISA) according to a new Organization for Economic Co-operation and Development (OECD) report. The report, Highlights From PISA 2009: Performance of U. S. 15-Year-Old Students in Reading, Mathematics, and Science Literacy in an International Context, provides an assessment of students' educational achievement and their ability to apply that knowledge in real world contexts. In comparison to the other 34 OECD member states, U.S. students (age 15) finished 14th in reading literacy, 17th in science and 24th in mathematics. If the OECD partner countries are included, those rankings fall to 17th in reading literacy, 23rd in science and 31st among the 65 countries surveyed. In 2009, approximately 470,000 students from 65 developed and underdeveloped countries took the PISA.

An interagency government initiative was launched last week to promote the nation's renewable energy sector, helping to meet the goals of the National Export Initiative and President Obama's challenge to become the leading exporter of clean energy technologies. Seven government agencies, including the Department of Energy, will lead market research and discovery efforts such as identifying U.S. manufactured energy efficiency products likely to be competitive in global markets and exploring the creation of guides for foreign buyers listing technologies and services available from U.S. providers. Read the press announcement: http://www.energy.gov/news/9864.htm

The Philadelphia region increased retention of non-native students (students who are not originally from Philadelphia but attended undergraduate or graduate school in region) by 165% from 2004 to 2010 due to an increase in regional involvement opportunities for students (e.g., volunteer opportunities, internships, off-campus work opportunities and local cultural/entertainment activities), according to a new survey by Campus Philly. The report also found a high correlation between a student having a summer internship and remaining in the region for a year or more (70% of respondents). In comparison, only 40% of students were retained if they interned outside of the region. The report, "From Student to Resident: Findings from Campus Philly's 2010 Student Retention Survey," utilizes data collected from 4,600 students (including undergraduate and graduate students) and recent alumni of Philadelphia colleges and universities.

The Council of Development Finance Agencies (CDFA) is asking for support in its effort to amend the current federal tax bill to extend the bond finance provisions of the Recovery Act. These provisions include the Build America Bonds, the Recovery Zone Bonds, the elimination of the alternative minimum tax on tax-exempt bonds, extending the Federal Home Loan Bank authority to issue letters of credit on tax-exempt non-housing bonds and continuing the relief offered to bank-qualification 501(c)3 bonds. The Senate version of the bill, which did not extend the provisions, passed on Wednesday. CDFA is now encouraging interested parties to contact their representative to ensure that the provisions are included in the House bill. Read the CDFA latest update ...

The Georgia Tech Enterprise Innovation Institute (EI2), Community Innovation Services, is seeking a group manager for research. The EI2 Community Innovation Services team supports communities with economic and community development research, analysis and planning. Projects range from strategic planning to workforce analysis, from fiscal impact analysis of new or expanding firms to sustainable development strategies for communities of all sizes. The group manager is responsible for the successful completion of all funded projects, for overseeing and advising a team of high-performing project managers, and assigning projects to individual team members within CIS.

Michigan lawmakers last week passed a measure aimed at increasing access to capital for small businesses by allowing taxpayers to collect an income tax credit worth 25 percent of a qualified investment in emerging industries such as advanced manufacturing and life sciences. Under HB 5921, the investment must be at least $20,000 and certified by the Michigan Strategic Fund (MSF). MSF can certify up to $9 million in credits in a single year with up to $250,000 for each business. Gov. Jennifer Granholm proposed the angel tax credit during her State of the State address earlier this year (see the Feb. 10, 2010 issue of the Digest). The measure was passed with broad support by a vote of 85-14 in the House and 34-0 in the Senate. Read the governor's press release ...