SSTI Digest

A recent Brookings Institution report looks at the nearly 30-year impact of manufacturing's global realignment on US metropolitan areas, finding those with the highest dependence on manufacturing were impacted in several negative ways in addition to the losses in manufacturing. In particular, the resilience of the most manufacturing-centered economies — their ability to transition employment into other sectors — was particularly poor, many experiencing below national average growth in jobs and wages. Brookings reports only 3 of the 114 metro areas in the study exceeded the national averages for both jobs and wages: Charlotte, Manchester and Portland, ME.

The State of Wisconsin Investment Board (SWIB), on of the largest public pension funds in the country, plans to invest $80 million in a new "Catalyst Portfolio", intended to create profitable returns from venture investments and to attract the attention of coastal venture firms. SWIB intends to use to funds to invest in one or more venture funds, likely through a firm on the East or West coast. That investment would allow the board to act as a matchmaker between large investors in other states and Wisconsin's investor community. SWIB decided to create the fund following a 2010 analysis that found ample opportunities for profitable venture investment in the Midwest, but a lack of capital to support emerging companies. Read the announcement ...

Communities that are well-loved by their residents are more likely to experience strong economic growth and long-term prosperity , according to a new Gallup and Knight Foundation study noted by C2ER. Researchers have hypothesized that the relationship is causal, since community attachment can drive residents to make long-term, local investments and pursue other activities that bolster economic growth, such as entrepreneurship. Three qualities emerged in the study as the most important in increasing community attachment: social offerings, openness and beauty. Read the report ...

Ann Arbor SPARK is seeking qualified applicants to become their next CEO. The CEO will be responsible for continuing the momentum and positioning SPARK as a key leader in economic development. The ideal candidate has demonstrated P&L experience, preferably as a CEO; can build and manage a high performance team; has outstanding communication skills; has a strong financial and fundraising skillset and experience base; is able to quickly and effectively develop strong partnerships and relationships.

Maine Governor Paul LePage named Phillip Congdon as the new commissioner of the Department of Economic and Community Development. Cogndon is a licensed professional engineer who spent more than 20 years with Texas Instruments in Dallas. He replaces Acting Commissioner Thaxter Trafton.

Ohio Governor John Kasich announced Mark Kvamme, a partner at Sequoia Capital, will serve as the interim state development director. The Silicon Valley venture capitalist has agreed to do the job for a dollar.

Former NorTech CEO Dorothy Baunach will be Cuyahoga County's interim economic development director.

Ken Bloemer, executive director of the U.S.A. National Innovation Marketplace, will replace Phil Doepker as director of the University of Dayton, Innovation Center.

Earlier this week, President Barack Obama signed the reauthorization of the COMPETES Act, extending the federal competitiveness initiative that provides funding for numerous science, STEM education and commercialization programs. Though the final bill represents a significantly scaled-back version of the legislation passed in May by the House, the final version will allow the programs introduced in the COMPETES Act to continue for another three years. The reauthorization also includes a new regional innovation program to award competitive grants for activities relating to the formation and development of regional innovation clusters.

A $25 million fund providing grants for tech commercialization, matching funds for research, and funding to attract "star" researchers to Virginia's universities is a key component of Gov. Bob McDonnell's $54 million Opportunity at Work agenda presented to lawmakers as part of his amendments to the 2010-12 budget. The governor's budget also includes $5 million for a refundable R&D tax credit and an extra $50 million for higher education directed toward increasing college access and economic development opportunities.

The $25 million Virginia Research and Technology Innovation Fund would be governed by a board of technology industry experts, legislators and administration representatives with funding directed toward targeted sectors including information technology, biotechnology, life sciences, alternative energy, advanced electronics, polymers, composites and aerospace propulsion. Grants or loans would be distributed among three funds:

The 11th Annual Tech Talkin' Govs series highlights new and expanded TBED proposals from governors' State of the State, Budget and Inaugural Addresses across the nation. The first edition includes excerpts from speeches delivered in the following states:

New YorkGov. Andrew Cuomo, State of the State Address, Jan. 5, 2011"We must change the way we engage in economic development planning and execution. Those working at the local level know their area economies best and we will empower them through the creation of regional economic development councils that can coordinate and integrate state agency responses with local government and business activities to create jobs.

"These will not be advisory councils but instead planning and implementation councils that are empowered to allocate resources. ...

Building on the state's seven economic clusters identified to grow the economy through targeted investments in emerging industries, Gov. Gary Herbert is asking lawmakers to provide $500,000 in FY12 to plan and identify for additional projects. The Utah Cluster Acceleration Partnership (UCAP) is a collaboration of leaders from industry, state government, higher education, and workforce charged with developing strategies to develop industry-driven education and training services, leverage resources from higher education to accelerate industry clusters, and identify best practices.

So far, three partnerships are underway in the areas of aerospace and defense, energy, and digital media. Additional UCAP's may be established in the areas of health care, life sciences and advanced manufacturing. The governor recommends one-time funding of $500,000 for "development of new technologies within Utah's economic clusters" from the Education Fund within the higher education operating budget.

After two years of stagnancy, venture-backed company exits improved dramatically in 2010, according to the National Venture Capital Association (NVCA). The increase was driven by a record-breaking market for acquisitions and the best quarter for initial public offerings (IPOs) in ten years. NVCA attributes the uptick in IPOs to a surge in Chinese venture-backed companies going public on U.S. exchanges. A recent NVCA/Dow Jones VentureSource survey finds that most venture capitalists (VCs) and venture-backed CEOs expect exits to continue their upward swing and that venture investments will grow in the coming year.

Connecticut has certified its first fund manager under the state's revised Insurance Reinvestment Tax Credit program, which has now expanded beyond its focus on insurance-related companies to support early stage and high-tech firms. Advantage Capital Partners has raised $72 million to invest under the revamped program. Fund managers may invest in any Connecticut-based business. One quarter of the investments must support green technology firms, and three percent must go toward pre-seed stage projects. Read Governor Joni Rell's press release ...

In "Advantage: How American Innovation can Overcome the Asian Challenge," Adam Segal contends the U.S. will continue to maintain a comparative advantage in innovation over Asia due to the "software" of innovation. The "software" of innovation revolves around the political social and institutional factors that move ideas from the lab to the market place. America's cultural values of individualism, social mobility, entrepreneurship, limited barriers to market access and low risk-aversion provide it a significant advantage over our Asian competitors. It is necessary to leverage and continue to cultivate the U.S. "software" of innovation because Asia's science and technology sectors (S&T), specifically China and India, are rapidly catching up to and should overtake the U.S. in several areas including the number of Ph.D.s awarded, investments in product innovation, number of patents obtained and facilities — Segal terms these quantifiable factors as the "hardware" of innovation. Segal, a senior fellow at the Council on Foreign Relations, argues that this decline in the U.S.