State Techbased Economic Development: A National Perspective

1
State Tech-based Economic Development A
National Perspective

• Presentation by
• Dan Berglund
• March 19, 2009

2
State Science and Technology Institute

• Mission
• Leads, supports, and strengthens efforts to
  improve state and regional economies through
  science, technology, and innovation
• Funders
• Carnegie Corporation
• Kauffman Foundation
• MEP
• More than 180 state, local, and university TBED
  organizations

3
What is TBED?

• Approach used to help create a climate where
  firms that constantly innovate and maximize the
  use of technology can thrive
• Emphasis grow your own
• Can be powerful partner with conventional
  economic developments recruitment of companies

4
Why do This?

• Global competition
• Lesser-skilled, lower wage jobs outsourced, or
  done more competitively, overseas
• Quality jobs
• Technology industries wages average 84 percent
  more than U.S. average
• 69,000 vs. 37,500 (2003)
• Changing demands of industry
• Because of the growing technology-intensity of
  all industry, citizens success is increasingly
  dependent on their ability to learn, adapt, and
  contribute to innovation

5
Kentucky vs. North Carolina
6
Major New Initiatives

• Legislatures approved
• AZ-- 25M/year for four years for 21st Century
  Fund
• AR up to 140M for various TBED initiatives
• CA-- 70M for two energy research centers
• FL-- 29.5M for Opportunity Fund 180M for
  research
• IN-- 20M Life Sciences Fund
• IA-- 25M for Iowa Power Fund 25M for next 3
  years
• MO-- 15M for several new TBED initiatives
• WA-- 70M over biennium for Life Sciences
  Discovery Fund 10 year commitment of 35M/year

7
Energy in 2007

• Heavy emphasis on research
• Specific centers or demonstration plants
• CA (70M), FL (20M), NC (5M), OK (40M), OR
  (6.7M), TN (51.6M)
• Pool of funds to compete for
• IA-- 25M w 75M to come
• MN-- 5.65M
• NM-- 2M
• ND-- 14.9M
• TN 13M

8
Focus on Energy Continues

• Legislature appropriated funding in 2008
• AK-- 50M for Renewable Energy Grant Fund up to
  250M
• CO-- 7.65M for Clean Energy Fund 2M for
  Colorado Renewable Energy Authority
• FL-- 50M for the Florida Energy Consortium for
  RD
• HI-- 8.7M for Hawaii Renewable Hydrogen Program
• KY-- 7M for Energy RD Fund
• MI-- 45M for Centers of Energy Excellence
• NM-- 1M for solar energy research park
• OH-- 150M for advanced and renewable energy
  distribution
• PA-- 40M for alternative energy development
  program

9
Elements for Tech-based Economy

• Intellectual infrastructure
• Spillovers of knowledge
• from universities
• from informal networks
• Physical infrastructure
• Technically skilled workforce
• Capital
• Entrepreneurial culture
• Quality of life

10
Intellectual infrastructure activities

• Strengthen states higher education system RD
  capacity
• Example Kentuckys Bucks for Brains
• Invest in basic research in hopes of seeding
  economic development and new industries
• Example Californias Embryonic Stem Cell
  Institute
• Invest in higher ed in areas of industrial
  relevance
• Example Georgia Research Alliance
• Invest in areas to diversify economy
• Example Michigans Life Sciences Corridor, Prop
  301
• Encourage greater university-industry interaction
• Example Maryland Industrial Partnerships Program

11
Improving Higher Ed Infrastructure Embraced

• Legislature appropriated funding
• AZ-- 25M for 21st Century Fund
• CA-- 70M for two energy research centers
• FL-- 80M for genomic res inst 100M for Ctrs of
  Excellence
• ID-- 1.5M for Higher Education Research Council
• IN-- 20M Life Sciences Fund
• MO-- 13.4M for animal health nutrition,
  renewable energy plant sci
• NC 25M to UNC-Chapel Hill for cancer research
• ND-- 20M for Centers of Excellence
• OH-- 100M for Ohio Research Scholars
• OK-- 75M for endowed chairs
• OR-- 11.5M for signature research centers
• WA-- 70M for Life Sciences Discovery Fund

12
Higher Ed 2008-- Scholars

• Legislature appropriated funding in 2008
• KY-- 60M for Bucks for Brains
• LA-- 8M one-time funding for endowed chairs and
  professorships
• SC-- 30M for Endowed Chairs Program
• UT-- 32.2M for USTAR
• WV-- 50M for Bucks for Brains

13
Spillovers of Knowledge

• Identify and remove barriers to commercialization
  of university-developed technology
• Example Oklahoma and Oregon
• Encourage commercialization of university-develope
  d technology
• Example Utahs Centers of Excellence
• Encourage commercialization of federal lab
  technology
• Example Technology Ventures Corporation
• Provide seed funding to industry associations and
  technology councils
• Examples MD, VA, and WA more than 200 groups

14
Spillovers of Knowledge

• Improve competitiveness of existing manufacturers
• Example Manufacturing Extension Partnership

15
Physical Infrastructure

• Research parks
• Example Centennial Campus
• Examine quality of infrastructure
• Example e-Com Ohio, ConnectKentucky
• Improve it through public or private action
• Example Berkshire Connect, e-NC

16
Technically Skilled Workforce

• Increase exposure to math science in K-12
• Example Maines Laptops for 7th graders
• Encourage more students to enter SE fields
• Examples SciTech Scholars and GI Bill for the
  New Economy in Pennsylvania
• Create internships to link students with jobs
  in-state
• Example North Dakota Operation Intern
• Subsidize tuition for undergraduate education
• Example Hope Scholarships
• Training for workers in technology-based
  companies
• Example Marylands Partnership for Workforce
  Quality

17
Capital

• Use state funds to invest in technology companies
• Example Massachusetts Technology Development
  Corporation
• Use state funds to leverage private funds to
  invest in technology companies
• Example Maryland Venture Capital Trust
• Encourage angel investing
• Example Arizona angel investor tax credit
• Provide assistance to companies to access
  financing sources
• Examples Oklahoma Tech Comm Center, Venture
  capital conferences, SBIR assistance

18
Entrepreneurial Culture

• Improve survival rate of start-up companies
• Example Ohios Edison Incubators
• Work intensively with entrepreneurs to develop
  their businesses
• Example Oklahoma Technology Commercialization
  Corp.
• Recruiting management talent
• Examples Kentucky, BFTP/Central
• One-stop resource directory
• Example CREC Program Finder

19
Kansas

• Kansas Technology Enterprise Corp.
• Investment Program
• Angel Investor Tax Credit Program
• Tech-based incubators
• Five small Centers of Excellence
• KTEC Pipeline
• MEP Center
• Annual budget 12.5M
• Kansas BioScience Authority
• Funded by TIF-like mechanism sunset at 581.8M
• Lead agency pursuing National Bio and Agro
  Defense Facility
• Recruit eminent scholars and support rising stars
• Matching federal funds
• Pre-venture financing to early-stage bioscience
  firms
• RD voucher program to support university-industry
  partnerships
• Awarded 86.7M as of Sept 2008

20
Kentucky

• Council on Post-Secondary Education
• Research Challenge Trust Fund 410M since 1998
• Department of Commercialization and Innovation
• Coordinating and strategy organization
• Match SBIR Phase I and II awards
• High-Tech Investment Pool
• 16.9M in FY2008 (some of which flows to KSTC)
• Kentucky Science and Technology Corp.
• Kentucky Enterprise Fund
• Kentucky RD Voucher Program
• Kentucky Rural Innovation Program
• Kentucky New Energy Ventures
• Innovation and Commercialization Centers
• Kentucky Science and Engineering Foundation
• Kentucky Commercialization Fund
• RD Excellence Program
• SBIR/STTR Phase 0 and Phase 00 Program

21
Maine

• Maine Office of Innovation
• Coordinating body and strategy
• 10M annual budget (most directed to MTI)
• Maine Technology Institute
• Business Innovation Programs
• Seed Grant Program
• Development Awards
• Accelerated Commercialization Fund
• SBIR/STTR Phase 0
• Cluster Initiative Program
• Maine Technology Asset Fund

22
Maine Strategy

• Three phases
• Invest in RD capacity, building up universities
  and non-profits such as Jackson Laboratory,
  Bigelow Labs using EPSCoR and RD bond funds.
  Also Maine Technology Institute funds for private
  sector RD. (1999- present)
• Invest in research infrastructure competitively
  with focus on collaboration (FY08-09 50 million
  bond).
• Going forward focus on commercialization next
  steps increased support for technology transfer,
  proof of concept, entrepreneurship, venture
  capital

23
(No Transcript)
24
397,126,970
25
Lessons Learned

• Committed high-level leadership is required that
  understands
• Economic impact further down the road than other
  approaches
• Research does not always succeed
• Significant cultural differences between actors
• Action should be based on
• Understanding of needs, capabilities, and gaps
• Filling gaps to encourage change in private
  sector behavior

26
Lessons Learned

• Characteristics of successful TBED programs
• Three hallmarks for long-term sustainability
• Do good work
• Measure whether theyre doing good work
• Telling people theyre doing good work
• Champions from more than one sector (ideally all
  three)
• Private sector, university, government (gov or
  legislature)
• Effective management and staff
• Entrepreneurial in approach/responding to change

27
Contact Information

• For more information, contact
• Dan Berglund
• 614.901.1690
• berglund_at_ssti.org
• To sign up for SSTI Weekly Digest go to
• http//www.ssti.org