Foundations Continue Funding TBED Despite Slow Economy

Many organizations are wondering if, when and how severe their budgets could be impacted by the economy and the continuing fiscal crises in the states. While foundation endowments also have taken a hit by the stock market slump, several are increasing their contributions in building local or statewide technology-based economies. Two recent examples highlight the trend and point toward a funding path few TBED efforts have fully tapped.

Danforth Foundation Commits $117 Million in St. Louis

The St. Louis Post Dispatch reported in a Jan. 9 article that the Danforth Foundation, based in St. Louis, has set aside $117 million over the next two years to support regional economic growth in the plant and biomedical sciences. The story states the foundation's board is "soley dedicated to identifying opportunities and making grants that will further research, spin off commercial opportunities and create jobs."

"If our region and state seize the opportunities, plant and life sciences can be the economic engine for St. Louis for decades to come," the foundation's chairman John Danforth said in a prepared statement, as quoted by the story. "The foundation has made this commitment as a catalyst to move the region from research leader to commercial leader in plant and life sciences."

The Danforth Foundation and Danforth family have been significant contributors to the region's goals of being a biotech center for many years. In 1998, the Foundation pledged $60 million toward a $146.4 million research center dedicated to plant science. The gift to the center, which is named the Donald Danforth Plant Science Center, included $10 million for capital and operating expenses, plus an additional $50 million over the next 10 years.

Dr. William Danforth chairs the Coalition for Plant and Life Sciences, a group of 32 business, civic, research and academic leaders convened by the St. Louis Regional Chamber and Growth Association to oversee implementation of the region's biotechnology strategic plan, developed in 2000 by the Battelle Memorial Institute.

Lilly Endowment Adds Nearly $25 Million to Rose-Hulman Ventures

The Lilly Endowment's commitment to improving Indiana's competitive position and performance in a knowledge-based economy has been documented in the Digest (see the 6/14/02, 11/2/01 and 10/15/99 issues). The latest news is a three-year $24.9 Million gift to expand Rose-Hulman Ventures (RHV), an initiative of the Rose-Hulman Institute of Technology. Lilly previously had provided $29.7 million in 1999 to create the program.

The new funding will be used to 1) expand educational opportunities by supporting additional client companies in partnership with other colleges, incubators and communities in Indiana; 2) establish a Center for the Deployment of Disruptive Technologies to ensure that students and faculty learn about the most significant technical advances that can help enterprises make transformative rather than marginal changes in their operations; 3) increase efforts to attract and retain client companies in the Terre Haute area by providing access to additional facilities in the community; and, 4) provide continued expansion of Rose-Hulman Ventures programs to enable RHV to become self-sustaining in the foreseeable future. More information on the gift is available at: http://www.rose-hulman.edu/news/articles/lilly_ventures.htm

To date, RHV has participated in 11 of the 25 largest 2001 Indiana venture capital deals (ranked by value of deal). It also has held the 6th position out of 11 Indiana venture capital firms (ranked by capital under management). RHV supports Indiana’s deals between the $50,000 and $1 million range, with investments in 2001 totaling $3 million in early stage and established technology companies.