SSTI Digest

Rev1 Ventures, an investor startup studio in Columbus, Ohio, that combines capital and strategic services to help startups scale and corporations innovate, recently released its 2023 Startup Impact Report. The report notes the entrepreneurs they supported last year raised $390 million in capital with 34 raising pre-seed capital, 16 seed capital, and 19 early-stage capital. The clients generated $192 million in revenue and created or retained 1,013 jobs.  Rev1 invested $6.4 million in 17 companies in 2023 and supported a variety of startups, “including enterprise SaaS technology creating efficiencies in insurance and real estate, advanced technologies in green energy and life science disruptors with novel therapeutics for genetic diseases with no current cure.” Additionally, Rev1 reports the companies it has supported over the last 10 years have surpassed $5 billion in total economic impact in Ohio.

The U.S. Small Business Administration (SBA) has announced the 2024 Growth Accelerator Fund Competition (GAFC) Stage One winners. Each received $50,000 in prize awards for impactful and inclusive approaches to foster a thriving, collaborative national innovation support ecosystem to advance small business R&D. The SBA press release announcing the winners stated that “GAFC Stage One winners are organizations with ecosystem-building activities, including recruitment of new partners and strengthening existing alliances among stakeholders (including public, private, nonprofit, and academic partners), that aligned their submission with one of the following GAFC Theme Areas” of national and economic security; domestic manufacturing and production; and, sustainability and biotechnology.

Data center electricity consumption is expected to triple in just eight years, according to a recent report from the Boston Consulting Group. They project the tripling to occur in both the amount of electricity consumed (~130 TWh in 2022 to ~390 TWh in 2030) and its share of total U.S. electricity consumption (2.5% in 2022 to 7.5% in 2030). Of that ~260 TWh increase, BCG attributes ~70TWh to the electricity demands for generative AI. The impact of this demand is being felt in some regions of the U.S. For example, “Data centers in central Ohio are gobbling up vast amounts of electricity so fast that American Electric Power expects demand for power to double between 2018 and 2028,” according to a recent Columbus Dispatch article (subscription).

Which should be more valuable for an economic development minded investment program?

• Company A, which yields a 2x return on investment and has a technology that reduces carbon emissions and energy use,
• Company B, which returns 12x to investors through an impressive IPO but contributes more to climate change, or
• Company C, which returns 3x and the climate impacts of its technology and production process aren’t as easily measured so remain unknown.

The Federal Trade Commission has issued a final rule to promote competition by banning noncompetes against workers nationwide. According to the FTC press release, this final rule protects the fundamental freedom of workers to change jobs, increases innovation, and fosters new business formation.The FTC estimates that the final rule banning noncompetes will lead to new business formation growing by 2.7% per year, resulting in more than 8,500 additional new businesses created each year.

Pending congressional appropriations, NSF announced a solicitation  for a new set of NSF Regional Innovation Engines (NSF Engines). These NSF Engines would be in addition to the 10 inaugural engines the agency announced in January. In this proposed round of funding, NSF would only accept proposals for full NSF Engines, competing for up to $160 million over 10 years. Proposers would be asked to submit a letter of intent in place of a concept outline and a short preliminary proposal.

SSTI and more than 160 state and local governments, institutions of higher education, businesses, trade associations, and nonprofit organizations sent a letter to Congress asking for Tech Hubs appropriations in the FY 2025 budget. As the letter points out, “America’s economic and security needs depend on the country’s ability to remain at the forefront of technological frontiers,” and the bipartisan CHIPS and Science Act envisioned a scale for this effort that would see approximately $6 billion in funding through FY 2025—well above the $541 million that Congress has provided to date. Read the full letter, add your organization’s support, and share with your regional stakeholders. 

The U.S. Department of Commerce has recently signed two non-binding preliminary memorandums of terms (PMTs) with semiconductor companies to provide direct funding under the CHIPS and Science Act. One company, the TSMC Arizona Corporation (TSMC Arizona), a subsidiary of Taiwan Semiconductor Manufacturing Company Limited (TSMC), will receive up to $6.6 billion to support the company’s investment of more than $65 billion in three greenfield fabs in Phoenix, Arizona. The second company, Samsung Electronics (Samsung), will receive up to $6.4 billion for two new logic fabs, an R&D fab, and an advanced packaging facility in Taylor, Texas, as well as an expansion to their existing Austin facility.

The National Institute of Standards and Technology (NIST) have posted the position for director, Hollings Manufacturing Extension Partnership (MEP) Program after the recent announcement that the previous director had left to become director of the CDFI Fund. The director “directs and controls the activities of the MEP,” according to the posting. Qualifications required include, “A broad knowledge of and demonstrated experience in manufacturing, manufacturing and industrial extension programs, and/or technology-based economic development.” The posting is open to May 8 with applicants encouraged not to wait until the last day to apply. Historically, MEP has partnered closely with the states and most SSTI members.

The U.S. Environmental Protection Agency has announced its selections for $20 billion in grant awards under two competitions within the $27 billion Greenhouse Gas Reduction Fund (GGRF). The three selections under the $14 billion National Clean Investment Fund and five selections under the $6 billion Clean Communities Investment Accelerator will, according to an announcement from the EPA, “create a national clean financing network for clean energy and climate solutions across sectors…. By financing tens of thousands of projects, this national clean financing network will mobilize private capital to reduce climate and air pollution….”

Sometime in late May, the U.S. will pass a deadline that could have major repercussions for new administration rules, depending on the outcome of the 2024 federal elections. In effect, rules finalized before late May would be overturned only by going through a new, full rulemaking process, which can be a lengthy process. Rules passed after that date, however, could be overturned relatively quickly by Congress if control of the branches changes.

The Commerce Department has suspended plans to announce a funding opportunity for the construction, modernization, or expansion of commercial semiconductor R&D facilities, according to an announcement the CHIPS Program Office made in their newsletter last week. The suspension does not impact the $11 billion the CHIPS Program Office still plans to spend on semiconductor R&D through separate R&D programs, nor does it affect the awards for incentive program funding opportunities already announced.