SSTI Digest

A portfolio company of JumpStart Inc., an Ohio venture development organization, is to be purchased for $1.1 billion. The proposed acquisition of Ohio startup CoverMyMeds by McKesson Corp. marks Ohio’s first tech startup unicorn. JumpStart Evergreen, the non-profit fund that invested in CoverMyMeds, was funded in part by Ohio Third Frontier. CoverMyMeds was started in Ohio in 2008 and is now headquartered in Columbus. It provides electronic prior authorization solutions to pharmacies, providers, payers and pharmaceutical manufacturers. The deal is expected to close in the first half of FY 2018 and its workforce, in both Cleveland and Columbus offices, is expected to grow. Following the close of the transaction, CoverMyMeds will operate as an independent business unit under its existing leadership team. The deal was covered in a Columbus Business First story. Both Ohio Third Frontier and JumpStart Inc. are SSTI members.

The Appalachian Regional Commission (ARC) announced $26 million in awards to expand and diversify the economy in coal-impacted communities in five states. This adds to the $47 million ARC has invested since 2015 through the Partnerships for Opportunity and Workforce and Economic Revitalization (POWER) Initiative. The 31 awards that were announced in late January are projected to create or retain more than 2,500 jobs and leverage an additional $32 million from public and private investors.

The POWER Initiative is a congressionally funded, multi-state strategy to bring federal resources to coal-impacted regions that have been negatively affected by changes in America’s energy production. The awards are intended to better equip workers and students in the Appalachian region with skills and opportunities in manufacturing, technology, entrepreneurship, agriculture, and other emerging sectors.

A sampling of the 31 grantees include:

The National Telecommunications and Information Administration and the National Science Foundation have released The National Broadband Research Agenda, a report detailing key priorities for broadband research and data. Despite significant advances in broadband connectivity, disparities remain in access, adoption and choice. For example, 10 percent of Americans lack access to the FCC’s prescribed benchmark speeds for downloads and uploads, less than 40 percent of Americans have the choice of more than one internet service provider and approximately 19 percent of schools lack the speed connectivity goals of the FCC.  A 2015 Broadband Opportunity Council report recommended further study to improve data collection, analysis and research; the topics covered in the new report.

While equity crowdfunding has received widespread attention since the 2012 JOBS Act, another SEC rule change (named Regulation A+) that allowed companies to offer “mini-IPOs” has flown largely under the radar. However, it has shown early promise as a new method for startup financing since it was passed in 2015. In this feature, SSTI addresses three important questions related to Regulation A+ (Reg A+) including:

What is Reg A+? What are the benefits and drawbacks of the offering? What impact has it made so far?

What is Reg A+?

 

NY Gov. Andrew Cuomo delivered his state of the state address over three days and six different speeches, and released his proposed FY 2018 budget following the talks. Some of his major proposals affecting the technology-based economic development field include proposals he had revealed earlier and have previously been covered in the Digest, including his proposal for free tuition as well as a major investment in the life sciences.  In keeping with our Tech Talkin’ Govs series and budget reviews, some excerpts from his various speeches are detailed here, as well as a closer analysis of his proposed budget.

From his Mid-Hudson address:

SSTI has reviewed another mix of state budgets as governors across the country continue to release their proposals. Some states, like California and North Dakota, are seeing cuts in the amount of money designated for TBED-related work, while others like Minnesota are in a more favorable fiscal situation and continue to fund such initiatives. Still others, like Rhode Island, are proposing new initiatives.

California

Online-education provider Coursera has announced a new program that allows governments and nonprofits focused on workforce development to curate massive open online course (MOOCs) that align with labor market needs, and then make these courses instantly available to their constituents. Initial partners of Coursera for Governments & Nonprofits include the United States and six other nations:  Egypt, Kazakhstan, Malaysia, Mongolia, Pakistan, and Singapore.

In the U.S., Coursera will partner with the Institute for Veterans & Military Families at Syracuse University (IVMF) to train transitioning service members, military spouses, and veterans in IT skills. Additionally, the University of New England will collaborate with TechHire grantee Coastal Counties Workforce, Inc., to offer accelerated online-offline learning programs to citizens across Maine.

With job growth for middle-skill level jobs slowing, the Federal Reserve Bank of Dallas and Austin-based nonprofit Center for Public Policy Priorities studied the nation’s best practices and surveyed regional workforce boards in Texas to determine how communities there are addressing the challenge. Their findings are detailed in the report, Regional Talent Pipelines: Collaborating with Industry to Build Opportunities in Texas, released last month. For a region to succeed in their workforce development efforts, the study states three tasks must be accomplished: identify growth through an industry cluster analysis, convene a sector partnership, and create and strengthen career pathways.

SSTI’s latest Tech Talkin’ Govs installment excerpts TBED highlights from governors’ speeches in Alaska, Indiana, Michigan, New Mexico, Nevada and Rhode Island. Education and workforce are focal points in this latest round of the state of the state addresses, as they have been in the two previous posts. Varying issues are factored into the speeches, from the $3 billion fiscal gap in Alaska to the proposed free college tuition in Rhode Island.

Alaska

Gov. Bill Walker, facing a $3 billion fiscal gap, delivered his third state of the state address to the State Legislature on Jan. 18 in Juneau:

“Here is the hard truth. Denial doesn't make the problem go away. Hope doesn't pay the bills. We need to pass a plan to stabilize our fiscal future. And we need it now.

“We must do a better job of preparing our youth for the challenges of the future. To meet this challenge, we need to rethink our entire system of public education. Alaskans must be at the heart of this effort.

Earlier in the month, Maryland Gov. Lawrence Hogan announced the 2017 Maryland Jobs Initiative, a legislative package that would eliminate all state taxes for 10 years for new manufacturing employers that create jobs in high unemployment areas, as well as incentives for current employers who expand their workforce in those areas. The package also includes $1 million for a program for employers to invest in employee training to keep their skills up to date, $3 million in funding for cyber job training grants, and expansion of an existing program that would make tax credits accessible to investors in cybersecurity startups. Released earlier this week, the governor’s budget recommends funding levels for a variety of tech-based economic development programs, initiatives and tax credits.

In his FY 2018 budget proposal, the governor is recommending:

While some researchers contend that university-industry collaboration may corrupt the academic ideal of open sciences and reduce academic productivity, researchers from the London Business School (LBS) and University of Southern California (USC) found that university-industry research collaborations – in certain situations – can lead to more publications but fewer patents than similar academic studies without industry partners. These findings would indicate that such collaboration can actually stimulate open science and increase academic productivity, rather than weaken it.

Approximately 6.2 percent of U.S. workers (nearly 8.6 million people) were employed in STEM jobs in May 2015, according to STEM Occupations: Past, Present, And Future from the U.S. Bureau of Labor Statistics (BLS).  Of those nearly 8.6 million people, nearly half (45 percent) are employed in computer occupations. In addition, seven of the 10 largest STEM occupations were related to computers and information systems including the largest STEM occupation – applications software developers (750,000 people).  STEM occupations provide nearly double the wages of non-STEM occupations.