SBA efforts to reign in abuse of the Small Business Innovation Research and Small Business Technology Transfer (SBIR/STTR) program continue, yet companies that seem to use SBIR awards as a primary revenue stream rather than a means to creating future revenue paths through new product and process innovations persist, based on SSTI’s review of award data. Known as “SBIR mills” many of these companies appear to be clustered geographically in specific metropolitan areas, many of which house major federal labs or research centers, the analysis of SBIR data reveals.  This suggests, from a policy perspective, that the federal agencies could be doing much more to curtail the mills and redirect awards into companies more consistently focused on turning innovation into products, profits and jobs.

The data reveals the extent of abuse by the small number of SBIR mills among all awardees is not insignificant: awards made to potential mills account for more than 21 percent of all awards made during the period from 2009 to 2019.

The U.S. Small Business Administration announced 24 organizations as recipients of the 2020 Federal and State Technology partnership (FAST) program grant awards. The awards of up to $125,000 focus on “specialized training, mentoring, and technical assistance for R&D-focused small businesses.” The FAST program grants one-year funding to organizations that work to partner with other in-state groups.

Eleven states are holding gubernatorial elections this year with nine incumbents seeking reelection, two of which are facing off against their lieutenant governor. Only one governor, Steve Bullock in Montana, is term-limited and unable to seek reelection. In Utah, Gov. Gary Herbert is stepping down from the position he has held for 10 years. While many of the races this year will reflect referendums on the current governor’s response to the COVID-19 pandemic, many of the candidates have announced their innovation and economic development initiatives.

A recent report by PitchBook indicates that angel investing is seeing fewer unique participants and a greater share of activity from groups than individuals. The same report provides an analysis of startup outcomes based on whether the company began with an angel or venture capital (VC) round and finds companies with angel backing initially look stronger but have a more mixed record over the long-term.

The Central Intelligence Agency is launching CIA Labs, a federal lab and in-house research and development arm intended to drive science and technology breakthroughs surrounding intelligence challenges.

This week, the U.S. Economic Development Administration (EDA) announced the 2020 Build-to-Scale awards. In this round, nearly $35 million was awarded to 52 organizations to support regional strategies advancing entrepreneurship and innovation. Through the end of 2019, funded organizations had worked with more than 6,200 startups, facilitating $1.6 billion in investment and the launch of more than 9,000 products, according to EDA.

Many of the most successful technology, life science and advanced companies in the country received financing in the form of an equity investment during their rapid growth and scaling stages of development.  Whether viewed as valiant, villains or vultures, the presence of individuals and firms willing to provide capital to companies when they have few physical assets or revenues is strongly associated with healthy regional innovation economies. As a result, considerable policy attention has been focused by states on increasing the amount of risk capital flowing to local startups.