SSTI Digest

The National Institute of Food and Agriculture (NIFA), USDA, is announcing the I-FAST prize competition to develop and implement the Innovations in Food and Agricultural Science and Technology (I-FAST) program. NIFA will partner with NSF Innovation Corps (I-Corps) to provide entrepreneurship training to NIFA grantees under this pilot program. The goals are to identify valuable product opportunities that can emerge from NIFA supported academic research. Over six months, the selected teams will learn what it will take to achieve an economic impact with their particular innovation. The final goal of the competition is to facilitate technology transfer of innovations that can make an impact in the marketplace.

The pre-application phase competition submission is open and ends August 3. More information is available here.

Investment in 3,912 venture-backed companies reached $57.5 billion invested across 3,997 deals in the first half of 2018, according to the 2Q 2018 PitchBook-NVCA Venture Monitor. With six months remaining in 2018, the $57.5 billion invested by venture capital (VC) firms already exceeds the full-year total for six of the past 10 years. If the current pace of dollars invested continues, 2018 will surpass 2017 as the highest amount of capital deployed by VCs in a year since the dot com era (early 2000s). Q1 and Q2 of 2018 also report as the highest quarters for VC dollars invested since the start of 2011.

The Minnesota Department of Deployment and Economic Development (DEED) has launched a new loan program for entrepreneurs with high-tech products or services. The loans are similar in size to microfinance options increasingly available to new bricks-and-mortar establishments, but flexible payment options and innovation-focused criteria are intended to make Minnesota Innovation Loans for Entrepreneurs (MILE) uniquely appropriate for tech-based economic development.

The debt provided through MILE is generous to entrepreneurs. There is no interest on the loan, and repayments do not start until year two, escalating through the four-year term. Loans may be $20,000-$50,000 and must be equally matched by another source.

A new Pew Research Center survey shows strong support among Americans for government investments in medical research, engineering and technology, and basic scientific research, echoing previous reports from 2014 and 2009. That support crosses political parties, although liberal Democrats show a greater percentage of support (92 percent) compared to conservative Republicans (61 percent).

The boost in federal R&D funds as a result of the 2009 stimulus package had a significant impact on local economic development, according to a new working paper from researchers at the University of Michigan. In “Local Fiscal Multiplier on R&D and Science Spending: Evidence from the American Recovery and Reinvestment Act” (ARRA), authors Yulia Chhabra, Margaret Levenstein, and Jason Owen-Smith look at changes in county-level employment in response to increased federal spending on R&D as a result of ARRA. The authors estimate causal effects of the ARRA R&D funding on local economic development, and find that, all else equal, every $1 million in new R&D spending due to the stimulus in a county led to 27 new jobs, with 25 of those being in the private sector. The authors estimate that the cost per each job-year was about $15,000, which is less than the reported costs of other types of federal stimulus programs.

Working with public and private-sector partners across the U.S., the EDA invested approximately $289.1 million in 815 locally-driven economic development projects in FY 2017, according to its most recent annual report. The report provides examples of the projects it funds in each state, to help show the breadth and diversity of the programs and projects it funds. It also provides an interactive map detailing the summary and case studies of investments for any given state or territory.

The White House Office of Management and Budget released Delivering Government Solutions in the 21st Century, a plan for reorganizing federal agencies. On topics related to innovation, the wide-ranging plan would make changes to education, workforce, economic development, small business and more. Some of the suggestions could advance with administrative actions only, while many will require congressional support. As with previous initial proposals from the administration, this document does not provide many of the details necessary to evaluate the real intention and opportunity of each proposal. The actual effects of implementation for many suggestions could range from reduced administrative overhead to funding reductions totaling billions of dollars, for example depending on the interpretation of “consolidate.” These four ideas from OMB have the greatest potential to impact support for innovation economies.

Real personal income — a measure of purchasing power that connects income to costs — has grown within states at an average rate of 1.5 percent per person since 2012, according to data from the Bureau of Economic Analysis. The average American’s experienced income growth, however, appears to vary wildly depending on location. A person’s state could mean experiencing as little as a 0.0 percent or as much as a 2.8 percent annual increase, while living in a metro area could mean losing 1.0 percent in annual income growth or gaining 3.4 percent relative to in-state peers living in non-metro areas. In terms of 2016 dollars, living in an average state’s metro area means an additional $4,169 in real person income.

The above figure displays these average year-over-year growth rates in real per capita income from 2012-2016. (The picklist at the top left controls the data displayed for the states, while options on the top right controls the data displayed for the top 100 metros.)

As part of the country’s single biggest investment in science in 40 years, the UK unveiled a new investment in UK talent and skills aimed at growing and attracting the best in science and innovation. Last week, UK business secretary Greg Clark outlined a £1.3 billion ($1.72 billion) investment for British universities and businesses to develop the next generation of entrepreneurs, innovators and scientific leaders. The money will help ensure the UK invests 2.4 percent of GDP in R&D by 2027 and “becomes the most innovative economy by 2030,” the government press release stated.

Clark also announced £900 million ($1.19 billion) to be disbursed over 11 years for the UK Research and Innovation Future Leaders Fellowship Scheme, with six funding competitions and at least 550 fellowships awarded over the next three years.

In an effort to move technologies into the commercial sector more quickly, Air Force Research Laboratory (AFRL) has introduced a one-stop shopping experience called Express Licensing. Interested innovators and entrepreneurs can visit a website featuring AFRL-developed technologies that are available for license and learn about pre-negotiated terms and pricing, eliminating the need for lengthy contract negotiations. The innovative approach was inspired by work done by the U.S. Navy, which has had success with this type of licensing model. 

There are currently 36 AFRL Materials and Manufacturing Directorate-developed technologies available for Express Licensing, with more expected to be added in the near future.

While many state startup capital ecosystems have a healthy density of early-stage startups, few states have developed strong late-stage ecosystems, according to a new report from PitchBook – 2Q 2018 PitchBook Analyst Note: VC Ecosystems. PitchBook researchers contend that one potential factor leading to these underdeveloped late-stage ecosystems is the limited number/size of exits coming from those ecosystems. They contend, however, that healthy early-stage startup density could indicate the potential for future growth in many state VC ecosystems, if those ecosystems increase the number of companies with exits. Via this new report, PitchBook outlines a proposed framework for the evaluation of venture ecosystems in the United States. 

As economic development efforts try to keep up with changing demographics, many states, regions, metros, and other local governments face difficulties trying to cultivate, attract and retain a 21st century workforce. Three recent reports look at the strategic steps that states and regions must play to create strong workforce development organizations.  While these reports, from the Urban Institute, the National Skills Coalition (NSC), and the Western Governors’ Association (WGA), look at broad workforce development strategies for public-sector agencies to employ, several states and cities have launched specific efforts to reimagine or strengthen their workforce development efforts.