SSTI Digest

President Obama announced  the creation of the new Smart Manufacturing Innovation Institute (Smart MII) – a $140 million public-private partnership to develop smart sensors for use in advanced manufacturing. Headquartered in Los Angeles, CA, the Smart Manufacturing Leadership Coalition (SMLC) – a consortium of nearly 200 partners from academia and industry as well as nonprofit organizations – will lead the Smart MII. The Smart MII is the ninth MII awarded by the Obama administration. The president also announced five additional MII competitions, which are intended to invest nearly $800 million in combined federal and non-federal resources to support transformative manufacturing technologies in four areas:

When employees discover potentially significant inventions during their line of work, they can decide whether to leave their company and form a new startup around the idea, or to transfer the knowledge to the parent firm and attempt to gain financial compensation through a spinoff. As seen in the 2016 summary report from Failure Aversion Change in Europe (FACE) Entrepreneurship, the two main fears for entrepreneurs are financial security and losing a stable, professional job. Recent research also suggests that granting employees extended leaves of absence with guaranteed options for returning increases the likelihood of entrepreneurship. Coupled together, these results prompted SSTI to further review the relationship between corporate-leave policies and entrepreneurship.

In addition to several new moonshot R&D initiatives and other joint research efforts, several universities recently have announced public-private partnerships that will build multi-million dollar, world-class R&D facilities. Whether it is on-campus facilities in Akron and Pittsburgh or off-campus facilities in Boston, Iowa City, and South Bend, IN, these new facilities are intended to build a 21st century workforce, launch startups, and cultivate R&D partnerships between universities and industry.

Montreal Mayor Denis Coderre launched Capital Intelligent Mtl – a 100 million CD (77.3 million USD) investment fund aimed at smart city startups and established businesses offering solutions to urban challenges that also will spur job creation in Montreal. The new public-private partnership will backed by 23 founding organizations including venture capital firms, financial institutions and corporations that have pledged over 100 million CD in private capital to establish the fund. In addition to the over 100 million CD from private sources, the city will commit 400,000 CD (309,000 USD) for the administration of Capital Intelligent Mtl through to 2018 with the intent of ensuring the coordination of the group's activities. While the management team of Capital Intelligent Mtl will oversee the day-to-day operations of the investment fund as well as pre-quality companies for investment, partners will be included in the final review of all investments. Capital Intelligent Mtl can make investments of up to 5 million USD (3.9 million USD) into individual companies.

On June 3, the Department of Commerce’s Economics & Statistics Administration (ESA) released Digital Matching Firms: A New Definition in the 'Sharing Economy' Space. In the new report, the ESA provides the first government definition of digital matching firms (e.g., Uber, Lyft, AirBnb, Homeway) – companies that use Internet and smartphone-enabled apps to match service providers with consumers, help ensure trust and quality assurance via peer-rating services, and rely on flexible service providers who, when necessary, use their own assets. In addition to defining digital matching firms, the report provides an initial assessment of its size and scope of the digital matching firms (gathered from several publically available sources) including:

Ohio Gov. John Kasich signed a bill (HB 233) last month that authorizes cities and villages to create Downtown Redevelopment Districts (DRDs) that can address innovation districts and/or historic rehabilitation. The DRDs permit tax abatements of up to 70 percent of increased assessments in conjunction with payments in lieu of taxes (PILOTs) or a redevelopment charge that functions as a special assessment tax. In the case of innovation districts, these charges may be used to fund loans or grants to technology businesses—specifically including R&D and technology transfer activities—or to incubators or accelerators in the district.

In an attempt to support their respective  innovation economies, several countries have announced new national investment strategies and other entrepreneurial support efforts that help startups access the capital necessary to move their business from an idea to a sustainable businesses. Efforts include a fintech focused-fund in Ireland, expansion of existing programs in two Oceanian countries, and a partnership between two of Asia’s largest economies.

New Zealand

Federal obligations for science and engineering research and development to universities, colleges, and nonprofit institutions increased by 5.7 percent from FY 2013 to FY 2014, according to recently released data from the National Science Foundation’s (NSF) Survey of Federal Funds for Research and Development. For the fourth consecutive year, the states with the largest federal obligations for science and engineering R&D to universities, colleges and nonprofit institutions in FY 2014 were California ($3.9 billion), New York ($2.2 billion), and Maryland ($1.8 billion). Between FY 2013 and FY 2014, 38 states and the District of Columbia saw an increase in federal obligations for science and engineering research and development at these organizations. An Excel sheet that shows the obligations for each state from FY 2006 to FY 2014, plus comparisons between three specific time periods can be found here.

While the recent Job Openings and Labor Turnover Survey (JOLTS) has some economists concerned that the U.S. economy is running out of qualified workers to fill existing openings, several states have announced workforce programs that are intended to address the skills-gap and build the talent pipeline in their respective states. These programs are intended to build regional partnerships between local workforce development agencies, economic development agencies, industry, and others. Approaches include a statewide apprenticeship tax credit in Alabama; occupation training for high-demand occupations in Texas; and, incumbent workforce training in Virginia.

The Department of Labor’s (DOL) Employment and Training Administration (ETA) released a federal funding opportunity (FFO) for the America’s Promise Job Driven Grant Program. Announced in May by Vice President Joe Biden, ETA will make up to 40 grants from approximately $100 million in available funding to provide individuals the opportunity to get high-quality, tuition-free education and training that leads to in-demand and industry-recognized credentials and degrees. The grants also will help support the development and growth of regional partnerships between workforce agencies, education, training providers and employers in a variety of industries such as information technology, healthcare, advanced manufacturing, financial services and educational services. Applications are due August 25. Read the FFO…

Despite increasing demand for life sciences research funding and larger budgets from Congress, access to the investigator research funding from the National Institutes of Health (NIH) is getting harder, according to data released May 31 by Michael Lauer, NIH deputy director for Extramural Research.  R01 grants, the oldest and predominant funding mechanism NIH uses to distribute project-specific research grants, are becoming larger in size and more exclusive in who receives the grants. Recent statistics indicate dollars may be limited, in part, because they are going to fewer researchers in larger amounts.

Proponents for increasing appropriations for the National Institutes of Health (NIH) and related federal agencies supporting life sciences research argue their case, in part, on statistics showing the unmet demand for funding as expressed by the number of unsuccessful proposals submitted to NIH each year. Most recently in 2015, 16.3 percent of de novo research grant applications were successful in their pursuit of NIF funding; the figure was as high as 27.1 percent in 2001.

In the lead-up to the Biotechnology Innovation Organization’s (BIO) International Convention held this week, the organization released a series of reports on the health of the industry. Collectively, the reports indicate that the bioscience industry is seeing greater employment with better wages, increasing venture investment, but university and federal funding, patent filings and clinical trial success are leveling off or decreasing.