SSTI Digest

With veteran unemployment rates exceeding the already-high national unemployment rate, organizations and agencies around the country are seeking ways to plug veterans into the innovation economy. These efforts capitalize on the leadership skills and technical knowledge of military veterans by helping them become entrepreneurs. Operation Boots to Business is a new nationwide initiative, backed by the U.S. Small Business Administration (SBA), that will provide entrepreneurship training courses at military bases to help veterans transition into business ownership. Arizona State University's Venture Catalyst will offer a version of its Rapid Startup School program for veterans as part of a more extensive effort to help veterans become a part of the innovation community.

Life sciences advocates in Arizona are celebrating the passage of HB 2272, a measure to tighten open records laws that require details of intellectual property be disclosed. Passage of the legislation will protect against the loss of current research contracts or the possibility of missed opportunities due to concerns over the state's previous law, according to a statement by the Arizona Bioscience Industry Association (AZBio).

As many states near the mid-point of their 2012 legislative sessions, we thought it would be a good time to take a look at some of the bills advancing in statehouses that could impact states' efforts to improve economic conditions. Several states are seeking to advance access to capital initiatives as they continue to struggle with declining revenue and tight credit restrictions. The following overview provides a sampling of TBED bills supporting access to capital, R&D enhancements and higher education standards.

With the goal of integrating STEM learning into schools and strengthening teacher effectiveness in STEM areas, Science Foundation Arizona (SFAz) is launching the Arizona STEM Network, which will be implemented over the next five years in school districts throughout the state. In Texas, officials are counting on a new $30 million fund to produce more STEM graduates by recruiting top-notch research faculty to the University of Houston (UH). The Arizona STEM Network builds on Gov. Jan Brewer's plan for STEM education announced in 2010. SFAz will serve as the operational management hub to provide focus, commitment and structure to achieve the goals outlined in the implementation plan. Four strategic concentrations will guide the work of the STEM Network over the next five years. These include: Integrating STEM into schools and districts by working with the governor's office, Department of Education and county superintendents to extend STEM expertise through Regional Education Service Centers. Predictive analysis and measurement of outcomes by developing and deploying performance-based analytics and a technology infrastructure to collect, analyze and disseminate program metrics throughout the network. Strengthening teacher effectiveness by identifying project-based STEM teaching models, engaging teachers and students in STEM career exploration and professional development, and supporting research and teaching faculty at Arizona higher education institutions to develop innovative, content-focused STEM education courses for new teachers. Creating meaningful business engagement opportunities by designing activities for STEM advocates to mentor teachers, host field trips, or contribute to curriculum development. The network is supported primarily through a private foundation, Freeport-McMoRan, Cooper & Gold, which provided $2.2 million to establish the STEM initiative. The foundation announced a new three-year commitment beginning in 2012 totaling $2.1 million for operational funding that will allow SFAz to roll out its new plan. Read the announcement: http://sfaz.org/live/collection/news-stories/114310. A new initiative in Texas is aiming for the same goal of producing more graduates in STEM fields, but efforts will be focused on faculty recruitment with hopes of attracting high-achieving students. Over the next two years, the University of Houston (UH) will hire 60 new faculty members in STEM fields with help from a new $30 million fund. The fund will provide startup incentive packages to attract some of the nation's most talented research faculty in the fields of science, technology, education and mathematics, according to a press release. The initiative is part of the university's efforts to secure Tier 1 status. Read more: http://www.uh.edu/news-events/stories/2012/february/0228STEM.php.

Across the U.S. and Canada, universities continue to forge public-private partnerships focused on creating a formalized approach to turn university research into market-ready products and startup companies. Three universities and their respective partners recently have announced efforts to bring inventors, the community and investors closer together. They also intended to provide potential entrepreneurs with the skills, mentorship and resources need to launch a startup company. Simon Fraser University Simon Fraser University (British Columbia, Canada) launched a $210,000 high-tech entrepreneurship initiative that will establish an incubator targeted at third- and fourth-year business and applied sciences students. The program will provide skills, mentors and resources to help launch new, student-led startups from innovative ideas. Students accepted into the program will take a variety of courses and have access to mentors, scholarships and a product design studio. Over the next seven years, the university hopes to accept 20 to 25 students with the goal of producing six potential companies or products annually. The initiative received approximately $205,000 in matching funds from the province through the British Columbia Innovation Council. Read the press release... University of Alabama at Birmingham The University of Alabama at Birmingham (UAB) recently unveiled the Invention to Innovation (i2i) initiative — a formalized approach intended to directly link the business community to university research activities. UAB, in partnership with the Birmingham Business Alliance, hopes to match potential entrepreneurs and research teams with technology-specific mentors (i.e., market experts, technology experts or as entrepreneurial quarterbacks). The University also intends to revive a certificate in the life sciences entrepreneurship program. Currently, the four-course graduate program is working with candidates in the Alabama Launchpad, a statewide competition between tech-based startups held by the Economic Development Partnership of Alabama. However, the certificate will be made available to all students in the future. Read the press release... University of Arizona Tech Launch Arizona is intended to help University of Arizona (UA) students and researchers move their inventions from the labs to the marketplace. The initiative is intended to restructure university technology transfer and commercialization and bring UA inventors, the community and investors closer together. To achieve these goals, Tech Launch Arizona will consolidate resources and provide funding for proof-of-concept tests, or prototyping and testing. The state will contribute about $1 million a year in funding from the Technology Research Initiative Fund to increase this funding through Tech Launch Arizona. The program also will work to match business students with innovators to help with business plans and potentially create startup companies. Currently, Tech Launch Arizona is a decentralized hub, but long-term the University plans to construct a physical area to house Tech Launch projects.

With a sharp decline in state funding available for higher education over the past several years, performance- and outcome-based funding has garnered a great deal of attention in several states seeking to maximize education funds and support economic growth. Governors in Arizona and New Mexico recently proposed significant reforms in higher education funding so that universities with greater R&D expenditures and those that graduate more students in science, technology, engineering and mathematics (STEM) fields would receive a bigger share of state funds. Arizona Gov. Jan Brewer's funding plan for higher education builds on a formula recommendation published last year by the Board of Regents that includes increases in degrees, credit hours and outside research and public service funding. Gov. Brewer recommends moving to the Board of Regents $15 million of the universities' base funding, which would be allocated using each university's share of total general fund support. The state would match the $15 million, for a total $30 million to be allocated by the Board of Regents to the universities based on an agreed-upon funding formula. The governor plans to work with the legislature and the universities in the coming months to determine a performance-funding formula. Her recommendations include incentivizing greater production of in-demand degrees specifically in the STEM fields. The governor also would expand community college and university partnership programs and increase graduation rates. The executive budget recommends $706.8 million for the University System in FY13, up from $682.5 million last year. Budget documents are available at: http://www.ospb.state.az.us/documents/2012/FY2013-ExecutiveBudget-Agency.... New Mexico Colleges and universities that increase the number of graduates qualified to fill new economy jobs in fields such as science, technology, engineering, health care and mathematics (STEHM) would be rewarded with more state funding under Gov. Susana Martinez's new formula. The governor wants to change the state's current formula, which funds higher education institutions based on size, courses and degree programs started to one that awards funding based on courses and degree programs completed. Although many details of the proposal have not been released, Jose Garcia, Secretary of Higher Education, said initially no institution would gain or lose more than 2 percent of its funding, and the ration of funding to the two-year and four-year colleges and universities would remain roughly equal, reports El Defensor Chieftain. Read the governor's press release: http://www.governor.state.nm.us/uploads/PressRelease/191a415014634aa8960...

Finding new and creative ways for high-tech companies to succeed is an important component in business incubation. A recent study examining best practices for supporting new company formation finds it is the synergy among multiple practices, policies and services that produces optimal outcomes. At the same time, collecting standardized measures, reporting on progress annually, conducting external independent evaluations, tracking programs, and continuing to enhance practices are singled out as important policy implications. Over the past few months, several new incubator models have emerged — including a concept for a hybrid-accelerator and a startup incubator that floats. Select announcements are included below. 

The National Science Foundation (NSF) has announced that it will award $74 million total for the creation of four interdisciplinary research and education centers as part of the third generation of NSF Engineering Research Centers. In addition to their primary focus on commercialization and education, these centers will emphasize innovation, entrepreneurship, small business collaboration, and international partnerships. For the first time, two of the ERCs will be co-funded by the Department of Energy. One, led by Arizona State University, will investigate quantum energy and sustainable solar technologies. A second at the University of Tennessee, Knoxville will develop more reliable and efficient electricity transmission networks. The other two ERCs will focus on research into urban water infrastructure and mind-machine interface at Stanford University and the University of Washington, respectively.

Recent announcements of new and emerging technology incubators range from Google's selection of Cape Town, South Africa to launch a pilot incubator supporting technology entrepreneurs that it hopes to replicate globally to Alabama Gov. Robert Bentley's plan to create a statewide business incubator focusing on workforce training. Select announcements from across the globe are highlighted below.

Science Foundation Arizona (SFAz) has stimulated the state's job creation and increased the amount of additional funds leveraged, according to a report by Battelle. In 2010, SFAz-funded programs led to over 1,150 new jobs, 84 patents and 16 new companies. For every $1.00 awarded by SFAz, an additional $3.06 was matched by an outside source (e.g., federal grants, industry, and venture capital). SFAz's leveraging has increased progressively over the last three years. The report also looked at the state's position in technology development and found several positives including: higher than average salaries for technology workers; lower unemployment in these sectors; and, strong gains in university R&D expenditures. However, according to the report, SFAz and the state should focus on developing a talented workforce and increasing the state's digital infrastructure. In comparison to national averages and 12 other benchmark states averages — including Colorado, Utah and Washington — Arizona lags behind national and benchmark state averages in access to school technology and STEM education. Read the report...

Facing massive government deficits and stagnant regional economies, many states are exploring new options for their economic development activities. Three states recently have taken steps towards eliminating their primary economic development agencies, and replacing them with public-private partnerships, intended to reduce state spending and improve the responsiveness of state efforts.

Arizona Gov. Jan Brewer will convene a special session to focus on job creation proposals centered on her effort to replace the state's Department of Commerce with the public-private partnership she established through executive order last year (see the July 14, 2010 issue of the Digest). Along with legislative approval of the Arizona Commerce Authority (ACA), the governor is calling for $25 million to launch the Arizona Competes Fund, providing tax incentives for businesses locating in the state.