SSTI Digest

Jefferson County, Missouri 

Its first economic growth strategy in more than a decade, the Jefferson County Economic Development Corp. has issued a plan aimed at attracting new businesses while supporting existing ones, an article in the St. Louis Post-Dispatch reported. The nonprofit's plan suggests acquiring land for industry and commercial development by working with farmland owners and getting municipal governments to delineate rural parcels. Among the programs detailed by the plan are a nonprofit business incubator which would offer low rent to start-up companies and a loan program for the companies. Much of the plan is geared to assist area small businesses, but it also would market the county's strengths, including its river and interstate access, to businesses across the U.S. The Economic Development Corporation presently is seeking grants to secure funding for the plan. 



Los Angeles, California 

An area in South Los Angeles devastated by riots in 1992 has been replaced by a 54,000-square-foot business incubator and technology center capable of holding 30 start-up companies, according to the Los Angeles Times. The FAME Renaissance Center, with high-speed Internet connections, video conferencing facilities and a 700-seat auditorium for community meetings and business seminars, will offer loans of $1,000 to $500,000 and up to $1 million through a venture capital fund. The creation of the center began in 1997, when FAME Renaissance received a $300,000 grant from the city's Community Development Department to purchase a 90-year-old building that once was a telephone switching station for Pacific Bell. The building subsequently was renovated with $6 million in state and federal grants and contributions. A waiting list of 100 companies exists. 



Newport, Rhode Island 

The state's first Academy of Information Technology – a four-year educational program meant to expose high school students to new technologies and prepare them for high-tech jobs – recently was introduced by the Rhode Island Technology Council (RITEC) at the Newport Area Career and Technical Center at Rogers High School. Students at the academy, the Providence Journal-Bulletin reported, will receive four years of training in high-tech skills and will be placed in internships with area high-tech businesses. Currently, 27 students are enrolled in the academy, where courses including web page design and multimedia skills training are based on a curriculum set by the National Academy Foundation (NAF), a nonprofit organization. RITEC and NAF expect to sign up to three new schools for the 2002-2003 school year. 



West Virginia  

Being encouraged by Sen. Jay Rockefeller in 2000 to increase funding for entrepreneurial development, business leaders will propose an advocacy group instead of a venture capital company, according to the Sunday Gazette Mail. The group will consist of existing venture capitalists and others wishing to help state business owners needing money for new ideas. Although mining and manufacturing traditionally have supported West Virginia's economy, the group serves to give the state a much-needed boost. The West Virginia Venture Connection is being considered as a name for the group.

California 

Capital Valley Ventures, a business accelerator with a three-month training program for tech entrepreneurs, is coming to the Sacramento region, the Sacramento Bee reported. The venture is being spearheaded by Jack Crawford Jr., founder of NetLink, NetSource, 2Publish and Campus Engine. Crawford reportedly plans to start a workshop series capable of holding 25 people interested in beginning new businesses. The series, scheduled to begin this month, will involve three-hour sessions held once a month for three months and offer training on raising capital, forming a management team and generating revenues. More information is available at: http://www.capitalvalleyventures.com 

While technological advancements occur every day, truly revolutionary technologies over the past three hundred years — those that promise so many diverse applications that they result in disruption and restructuring of several different industries — can be counted on one hand. The field of nanotechnology, with major implications for nearly every industrial sector, appears to be one of those once-in-a-lifetime breakthroughs. 



At this point, only a few states are preparing on a large scale to capitalize on the research and resulting economic growth of this exciting field. A $350 million research institute taking shape in southern California at the universities of California at Los Angeles and Santa Barbara is one of the most aggressive investments to date. 



The California NanoSystems Institute (CNSI), with 300,000 sq. ft. in two buildings on the two campuses, will house industry researchers, teachers, students and scientists. CNSI will facilitate the development of the science and engineering of integrated, macroscopic systems characterized by emergent behavior originating from the structure and organization of nanoscale components. 



Among the institute's sources of funding are the federal government, which is providing $110 million, and the State of California, contributing $100 million. Another $90 million is expected from private donors, and $50 million will come from corporate donations, including more than 20 companies. 



Martha Krebs, formerly the science director of the Department of Energy, is CNSI's founding director. 



What is Nanotechnology Anyway? 

Whether your state or community is prepared to invest as heavily into nano research as California, understanding the implications of nanotechnololgy will greatly improve the ability of your businesses, universities, technical colleges and tech-based economic development programs to benefit from and respond to the opportunities and challenges nanotechnology will bring. 



To assist practitioners in gaining a foothold in the field, SSTI is offering an in-depth workshop on the technology as one of its pre-conference sessions, September 19 in Pittsburgh. Nanotechnology and Photonics: Waves of the Future is being held in partnership with the American Society of Mechanical Engineers. Dr. Mihail Roco, Director of the National Nanotechnology Initiative and John Mendel, Materials Commercialization Manager with Eastman Kodak Company will lead the discussion of what nanotechnology is and its diverse applications, the current state of development, the potential impact on the economy and our lives, and what the federal government is doing to support the development of the technology. 



More information on CNSI is available at http://www.cnsi.ucla.edu/  To learn more about SSTI's nanotechnology and photonics pre-conference session and to register, visit http://www.ssti.org/Conf01/preconference.htm [expired]

Despite many indications that show strong potential for growth, Southern California's bioscience industry still faces challenges, according to a new report from the Los Angeles Regional Technology Alliance (larta). Released July 19, Heart of Gold: The Bioscience Industry in Southern California highlights the strengths of the region's industry and honestly assesses the ways that the industry can overcome its weaknesses. The report was created to present a full 

and objective overview of the industry through analysis of data from numerous sources, interviews with leaders of the biosciences industry, and insights from bioscience publications.

Cliff Numark is leaving his position as president and CEO of the San Diego Regional Technology Alliance to join a Los Angeles-based private consulting practice.

Julia Wilson is the new Executive Director of the San Diego Telecom Council. She formerly was director of corporate and foundation relations for San Diego State University.

Encouraging local sources of capital is a common element of most tech-based economic development efforts. The broad strategies to accomplish this typically include forums, investor groups, tax credits, CAPCOs, and public seed capital to fuel fund development.



A different approach was made almost two years ago when Pennsylvania Governor Tom Ridge announced the state was giving a $200,000 grant to Redleaf Group, a West Coast venture capital group to open its Atlantic headquarters in Pittsburgh. (see the Pittsburgh story in the 7/23/99 issue of the SSTI Weekly Digest).



Besides the obvious advantage to the state's economic development strategy of increasing deal flow for local businesses by having venture capital nearby, that inducement grant appears to be producing more notable fruit for the state.



Redleaf Group is in the news again for its recently formed partnership with the University of Pittsburgh to launch a new business accelerator. In addition to traditional incubator services, the new Oak Leaf Networks will provide preseed financing ranging between $50,000 and $500,000. Information technology, and bioinformatics companies will be targeted for potential tenants and investees.



Through its Office of Technology Management, the University of Pittsburgh with Oak Leaf Networks will facilitate the formation of new ventures based on university technology. Permanent space for Oak Leaf Networks will be located near the Pitt campus.



Redleaf also operates a similar business accelerator at the University of Pennsylvania.



OTHER RECENT VC DEVELOPMENTS



Lexington, Kentucky

The Lexington Herald-Leader reported Thursday that Lexington will be home to a $15-25 million private venture capital fund that will focus on health care and high-tech start up companies throughout the Commonwealth. Partners in the fund include Village Ventures, a private VC group that targets its deal searches toward smaller communities overlooked by other, larger investment companies. According to the article, Massachusetts-based Village Ventures has participated in the establishment of a dozen early-stage funds in ten states. The state's recent tech-based initiatives, including Bucks for Brains and the $52 million Kentucky Innovation Act, were cited by the new fund's founders as reasons why they were attracted to Kentucky (see the 2/18/00 issue of the SSTI Weekly Digest for a related story)



Fresno, California

In an effort to keep more local investors' money in the community, Fresno State University is assisting in the development of a $10-20 million venture capital fund for the central San Joaquin valley, according to a recent article in the Fresno Bee. The new CEO say once fully capitalized, San Joaquin Venture Partners could become "the premier agricultural technology venture capital fund in the country."



Green Bay, Wisconsin

The Post-Crescent reports a new Green Bay angels network is forming called ValleyAngels Investment Group, the fifth angel group to be created in the state during the past twelve months. The article says with 13 members currently and the potential to accommodate up to 30 investors, ValleyAngels plans to focus on science, technology, processing and manufacturing deals.



Great Angel Investing Resource

The new book Angel Investing, written by Harvard Business School professor Robert J. Robinson and management consultant Mark Van Osnabrugge, is already touted as one of the best resources for understanding the angel investment phenomenon -- one of the oldest but least known forms of raising capital for entrepreneurship. Angel and informal investing is a particularly useful tool in small communities under-served by venture capitalists and dominated by risk -adverse financial institutions. A longer description and purchasing information for Angel Investing and other titles for accessing capital are available on SSTI's website at: http://www.ssti.org/Publications/capital.htm

The latest Issue Brief from the National Science Foundation (NSF) shows research and development (R&D) expenditures remain heavily concentrated in a few states. Ten states -- California, New York, Michigan, Massachusetts, New Jersey, Texas, Illinois, Pennsylvania, Washington, and Maryland -- account for nearly two-thirds of national R&D investments. With the exception of California, which can claim one-fifth of the nation's R&D activity, there has been some movement in rankings of the top ten in the last four NSF reports:

Few economic sectors have experienced the combined economic, technological, social, biological, and – now with threats of mad cow and foot-and-mouth diseases – medical pressures that confront American agriculture. Adding the challenges of competing in the knowledge-based economy presents a formidable task for rural regions.



New Valley Connexions, a public-private partnership in California that teams agriculture businesses with both state and local governments as well as the larger business, financial, and educational communities, may provide a worthy model for study and replication in other parts of the country. Core funding for the initiative was provided by the Division of Science, Technology and Innovation within the California Technology, Trade and Commerce Agency.



Over the past three years, the partnership has developed plans for and is implementing a cluster-based economic development strategy, a comprehensive telecommunications plan, and a strategy to address digital divide issues for the eight-county San Joaquin Valley. An offshoot of the telecom plan is a builders’ seminar, to be held April 5, that will provide developers, planners, lenders, and communication companies strategic guidance on wiring the Valley's neighborhoods and offices for broadband communications services.



Producing A Competitive Advantage, the latest report from New Valley Connexions, outlines a tech-based economic development strategy for the region’s agri-businesses that focuses on the technological and marketplace dynamics of the New Economy and agri-technologies and processes for overcoming critical environmental issues.



The plan includes five recommendations for the San Joaquin Valley to implement to help the region address the forces of change in the agricultural sector: consolidation of the food distribution chain, technological advances, globalization, and mass market fragmentation. The recommendations, each of which has multiple action items identified for implementation, are:

Complementing California’s support for New Valley Connexion, described above, is the state’s $2 million Rural E-Commerce program. Administered by the Division of Science, Technology and Innovation within the California Technology, Trade & Commerce Agency, Rural E-Commerce provides grants to non-profit organizations, educational institutions, and local governments for innovative, community-driven solutions to the telecommunications challenges faced by rural residents.



Examples of projects eligible for Rural E-Commerce support include rural telecommunications planning, rural network infrastructure, innovative applications, education and training, and related community planning efforts. According to the request for proposals, Rural E-Commerce grants also can be used as matching funds for rural communities competing for federal and foundation grants in areas relevant to rural e-commerce, such as the Technology Opportunities Program (TOP) and the Public Telecommunications Facilities Program.



More information on the California Rural E-commerce Program is available at: http://commerce.ca.gov/dsti/grants.html

Does patenting encourage or speed the transfer of technology from universities? Does the prospect of receiving royalties and licensing fees increase motivation among university researchers to work with businesses to commercialize technology? A recent paper suggests the answers to both questions is "no," but that more empirical and statistical research is needed to determine whether or not increased emphasis on intellectual property rights is achieving the desired results.



How Do University Inventions Get Into Practice?, prepared by a team of researchers from across the country, is the first report on a study that attempts to understand:

President Bush has nominated Los Angeles resident Hector Barretto to serve as Administrator of the Small Business Administration.