SSTI Digest

In Q3 2014, venture capital (VC) investments in the U.S. dropped by 30 percent from Q2 totals, according a new report from CB Insights. Q3 VC deal levels also dropped by 10 percent from Q2 totals. The severe drop, however, can be attributed to Q2 being the most successful VC quarter since Q1 2001. The good news is that the first three quarters of 2014 saw the U.S. VC investment total reach $33.75 billion – an increase of 59 percent compared to the first nine months of last year. The initial public offering (IPO) market fell off significantly in Q3 with just 18 U.S.-based, VC-backed companies going public. In comparison, 59 companies went public in Q1 and Q2 combined. CB Insight researchers also found while late-stage deal share remained consistent at about 16 percent with Q1 and Q2, the size of those investments in share of venture capital dollars by series dropped from 35 percent in Q1 to only 22 percent in Q3. Read the report… Ohio Startups Attract $149M in Investments in 2013Investors made $149 million in total investments to Ohio startups in 2013, according to a recent report from VentureOhio. In Ohio VentureReport…

Between 2000 and 2010, about one-third of U.S. manufacturing employment – approximately five million jobs – were lost as a result of new technologies in the manufacturing process or competition from abroad, according to The Brookings Institution. “The decoupling of innovation from manufacturing,” as described by Harvard Professor Venky Narayanamurti, where “Americans brought great ideas to light, but then left the execution – manufacturing, and jobs – to others” has left the United States in a job crunch throughout the supply chain. In recent years, however, U.S. companies are increasingly moving their manufacturing stateside. Earlier this year, Whirlpool announced the addition of 400 new jobs for its Greenville, OH, KitchenAid plant. Caterpillar, which revealed plans to shift its production of small construction machinery to a new plant in North America in 2011, opened a $200 million facility in Athens, GA, in October 2013 with the potential to hire thousands of workers.  While other companies, ranging from Apple to crib maker Stanley Furniture, are moving back – or “reshoring” – for their own…

In response to declining appropriations and the termination of the Space Shuttle program, NASA has had to re-orient its approach to commercial partnerships. Over the past decade, NASA has turned to private partnerships to further the agency’s goals of space research and exploration. This same impulse has driven NASA to create regional partnerships to cultivate private space industry clusters and drive the development of the Commercial Crew program, which is highlighted as a core component of the agency’s FY15 budget proposal. These efforts have changed NASA’s role in regional, high-tech economic development from that of a research laboratory to a direct partner. The U.S. private space industry has expanded rapidly in recent years, according the Department of Commerce’s recent U.S. Space Industry Deep Dive report. Now over 80 percent of U.S. states participate in the U.S. space industry supply chain. While NASA funding and commercial space development has seen little or no change in the past decade, U.S. government purchase of private space company services increased by $5 billion from 2011-2012. A large part of the growth of the industry…

University-focused initiatives that help bring new technologies and products to market help drive regional economic development and encourage an entrepreneurial culture on campuses. To create stronger connections with the private sector, eliminate barriers between universities and the innovation community, and better support industry needs, some higher education institutions are honing in on entrepreneurship and commercialization activities. A November report from the Brookings Institution on university technology transfer delves into economic factors that have led to the organic emergence of a new model for technology transfer, including pressure on universities to be more responsive to market forces. This “nurturing startups model” incentivizes faculty to partner with local business incubators and capital investors to commercialize their research and technologies, the author says. The report also finds that only a few universities have been able to generate significant revenue from technology transfer activities and concludes with recommendations for government to better support these efforts. At the same time, the latest licensing activity survey…

In the U.S. there is strong bi-partisan consensus that immigration is a key driver for entrepreneurship and regional competitiveness.  With federal immigration reform essentially shelved for 2014, cities and states are searching for their own solutions to attract and retain high-skilled immigrants. Proposals by Michigan Gov. Rick Snyder and other policymakers represent new approaches to immigration reform that can support local entrepreneurship and regional economic development. House Speaker John Boehner has withdrawn Republican support for immigration reform in 2014, effectively ending any federal push to address the issue this year, according the Washington Post. The move comes in the wake of a nationally publicized request from Michigan Governor Rick Snyder for the federal government to allocate 50,000 EB-2 (high-skilled worker) visas over five years for exclusive use by the City of Detroit. While Detroit continues to suffer from the crippling effects of bankruptcy, there are plenty of high-tech and R&D-related jobs in the city that are going unfilled. Gov. Snyder, as well as civic leaders in Detroit, argue that investment in public education, arts,…

Last year, U.S. venture capitalists invested about $10.7 billion in seed and early stage companies, 17.1 percent higher than 2012, according to data from the National Venture Capital Association (NVCA) and PricewaterhouseCoopers (PwC) Moneytree survey.  Though the overall venture capital (VC) market has returned to about the same level of activity as before the economic crisis, investment in seed and early stage companies has grown by more than a third. Most of this increase is attributable to growth in early stage investment, but seed activity has grown as well (as discussed in another article). Previously, SSTI reported on a number of trends in the U.S. VC market during the period from 2008-13, including overall dollars and deals by state, per capita dollars and deals by state and each state’s share of national venture capital activity. SSTI has now prepared tables of seed and early stage venture investment and average deal size by state during the 2008-13 period. Download the tables in Excel format (xlsx)… While the U.S. seed and early stage capital market has never shown consistent growth year-after-year, it has generally trended up over the…

President Obama launched the Advanced Manufacturing Partnership Steering Committee “2.0.” Former SSTI board member Luis Proenza, president of The University of Akron is part of the steering committee chaired by Andrew Liveris, president, chairman, and CEO of the Dow Chemical Company, and Rafael Reif, president of the Massachusetts Institute of Technology. Mark Kittrell has been appointed the president of the Iowa Innovation Corporation. OK Gov. Mary Fallin has named Secretary of State Larry Parman as director of the Oklahoma Department of Commerce and secretary of commerce. Both positions require Senate confirmation. The University of Alabama at Birmingham launched the Institute for Innovation and Entrepreneurship. David Winwood, CEO of the research foundation, will be executive director of the institute, and Kathy Nugent, director of the biotechnology program at UAB, the institute’s managing director. Tim Franklin has accepted the position of associate VP for business and economic development and special advisor to the president at the New Jersey Institute of Technology. James Ruble has been named director of the Ohio…

Oklahoma Gov. Mary Fallin announced that Jonna Kirschner, executive director of the Oklahoma Commerce Department, will serve on a transition team to establish a new workers’ compensation system. Vaughn Clark , the Commerce Department’s director of community development, was named as interim executive director. Colorado Gov. John Hickenlooper named Mark Sirangelo, who is head of Sierra Nevada Corp., as chair of the Colorado Innovation Network and the state's new chief innovation officer. John Rhodes has been appointed as president and CEO of NYSERDA. Brian Cummings is leaving as vice president for technology commercialization at Ohio State University to seek other professional opportunities. Ray Atilano, the executive director of technology commercialization, also has left his position. Christy Wyskiel has been named senior adviser to the president for enterprise development at Johns Hopkins University. Wyskiel will fill the role beginning Jan. 1, succeeding Aris Melissaratos who accepted a new position as executive-in-residence and senior adviser to Dean Bernard T. Ferrari at the Johns Hopkins Carey Business School. Michael…

The winding down of the space shuttle program in Florida’s Space Coast by the Obama administration in 2010 spurred a transition in NASA’s areas of focus, including an increased emphasis on commercializing technologies and industry partnerships. NASA recently announced several new initiatives with tech firms, universities, and state agencies geared toward investing in cutting-edge research and technology and developing an educated workforce. In Northeast Ohio, a new nonprofit organization dedicated to commercializing a steady stream of NASA technologies is underway in partnership with TBED organizations and local industry leaders, reports Crain’s Cleveland Business. Called E4T for Effective Entrepreneurship Education and Economic Development for Technology, the group will recruit students tasked with finding profitable ways to use NASA Glenn technologies, the article states. Students from local colleges or high schools would work with current and retired technical experts at NASA Glenn. Organizers hope to raise enough money from foundations or the federal government to launch the effort by the end of the year. Prominent TBED groups JumpStart and…

A recent report by Cleveland State University's Levin College of Urban Affairs details the economic impact of companies supported by JumpStart Inc. and the North Coast Angel Fund in the 2012 calendar year. The 127 companies included in the study created 2,140 jobs in Ohio (1,652 in Northeast Ohio), generated $269.7 million in economic benefits for the state, and produced $35.5 million in federal, state, and local taxes. Those studied included 63 "portfolio companies" that received technical and funding assistance and 64 "client companies" that received only technical assistance. Read the report...

Yuka Nagashima, executive director of the High Technology Development Corp. and center director for the Innovate Hawaii program, has resigned from both posts and will leave the state agency in August. Nagashima will be leaving for Denmark to support her husband's research career. Len Higashi, current senior economic development manager, was selected to become the acting executive director. Raja Krishnamoorthi has been appointed vice chairman of the Illinois Innovation Council by Gov Pat Quinn. Jason Hall has been named the St. Louis Regional Chamber's vice president for business development and corporate counsel, effective June 28. Hall's most recent position was as deputy director for the Missouri Department of Economic Development. E. Gordon Gee, president of The Ohio State University announced plans to retire, effective July 1. Executive vice president and provost Joseph Alutto was named interim president. Rep. Jo Bonner announced he will retire from Congress on Aug. 15 in order to take a newly created position of vice chancellor for government relations and economic development at the University of Alabama System. Joan Dunbar…

While public debate rages over the role of surveillance in our society, one particularly infamous government surveillance technology, drones, is being prepared for private sector deployment in the U.S. Drone-related technologies are predicted to revolutionize commerce in the U.S., with industry projections valuing their initial deployment as an $82 billion boost to the national economy. In preparation for Federal Aviation Administration (FAA) rollout of drone-use regulations in 2015, entrepreneurs, multinational corporations and state governments are scrambling to be in a competitive position to benefit. While drones have been scrutinized in the press for their extensive use in overseas counter-terrorism operations, entrepreneurs at universities and startups across the country are experimenting with hundreds of potential civilian uses for the technology. State-by-state projections for the economic impacts of drone technology are widespread and robust. California is expected to win big because of its drone manufacturing base while Midwestern states like Kansas are expected to capitalize from the industry's agricultural applications. One of the key selling…