An SSTI analysis of exits occurring during the second quarter by a number of venture development organizations reveals equity investment in innovation companies undertaken as strategic public-private partnerships for regional growth can yield more for their communities than just hitting the return on investment expectations of seed and traditional venture capital. The recent exits highlighted below reveal a variety of economic development impacts resulting from effective innovation investment strategies, including:

Restoring America’s competitive edge requires a new approach to managing suppliers, one where all the players are connected, collaborative, and focused on maximizing shared value – a “smart supply chain” – says a new report from MForesight.

Presently, the IRS provides private foundations a tax break if they show a trend of exceeding qualifying distribution requirements (grants).

Funding for TBED programs took a hit under Massachusetts Gov. Charles Baker, who vetoed millions of dollars in programs that the legislature had approved in the FY 2018 state budget. Michigan programs fared better with funding maintained to diversify the state’s economy and funding for entrepreneurship ecosystems getting a boost. And in Virginia, after a messy budget process addressing an addendum to its biennial budget, many innovation programs saw increases.

Massachusetts

On July 11, without Gov. Tom Wolf’s signature, Pennsylvania’s budget (HB 218) for FY 2018 became law. State lawmakers, however, are still in the midst of a stalemate over how to pay for a nearly $32 billion budget.

In Blockchain and Economic Development: Hype vs. Reality, experts from the Center for Global Development address the economic development potential of blockchain technology including its potential and existing hurdles to its growth.

In its latest survey of U.S. public perception of manufacturing, Deloitte and The Manufacturing Institute found that the majority of Americans surveyed (roughly 8 in 10) view manufacturing as vital to maintaining economic prosperity in the country, but less than 5 in 10 find those jobs interesting or secure, and less than 3 in 10 would encourage their children to pursue a manufacturing career. However, respondents also said they believe future manufacturing jobs will require high-tech skills, be clean, safe and more innovative.

The number of minority-owned employer firms in the United States inched closer to the million-mark in 2015 after growing by 4.9 percent from the previous year, according to recently published data from the U.S. Census Bureau’s Annual Survey of Entrepreneurs. The 996,248 minority-owned employer firms in the U.S. employed roughly 8.0 million people in 2015 (6.2 percent increase from 2014) and had payrolls of $254.0 billion (8.0 percent increase from 2014).

From Main Street businesses to technology startups, research has shown the rate of new business formation in the United States has plummeted since the 1970s. In the past year, the Digest has frequently cited research from the Economic Innovation Group (EIG), the Kauffman Foundation, and the Federal Reserve on the impacts of declining dynamism on America’s economic outlook. A recent letter by economists at the Federal Reserve Bank of San Francisco suggests that an often-overlooked aspect of business formation is the availability of labor, and that policies that seek to improve and deepen the labor pool may help increase new business growth.

Over the past week, the U.S. Senate Committee on Appropriations has passed bills to fund commerce and science, transportation, energy and water and agriculture. Regional Innovation Strategies would be funded at $21 million, an increase of $4 million over FY 2017. Other innovation proposals received mixed support, as the Senate cut $3.2 billion from commerce, justice and science funding and another $400 million from agriculture.

As we enter the second half of 2017, the U.S. venture capital (VC) market is driven by several noticeable trends. After peaking in 2015, the current VC market continues its slow decline in the number of deals, but Q2 of 2017 saw a spike in mega-rounds – rounds of $100 million or more. These mega-rounds are accompanied by strong fundraising efforts including a record-setting mega fund launch.

The U.S. House and Senate Armed Services Committees recently passed their versions of the FY 2018 National Defense Authorization Act (NDAA). The legislation includes provisions for federal labs, SBIR and SBA technical assistance programs. These portions of the bills are currently very different between the chambers, and, if passed in their current forms, the final bill could address a wide range of policies affecting small business and innovation.

One week before implementation, the Department of Homeland Security (DHS) announced that the International Entrepreneur Rule would be delayed until March 2018 and that a new proposal to rescind the rule will be made. The rule would have provided immigrants who have founded a high-potential startup with equity investment to remain in the country up to five years to scale the company.

Startup innovators from around the country have the opportunity to exhibit their ideas and win $10,000 during the Catalysts of the Climate Economy national innovation summit in Burlington, Vermont, Sept. 6-8. Innovators in the climate economy are encouraged to enter a contest that will result in five competitors pitching their ideas to a panel of judges, with the winning idea garnering the top prize.

In a recent post, the Brookings Institution’s Mark Muro raises concerns about the U.S. manufacturing sector’s health due to the leading indicators of slowed growth in both auto sector output and auto manufacturing employment. Muro contends that these slowdowns are driven by plateaued consumer demand and automakers investing billions in developing technologies necessary for electric and self-driving cars.

Breaking a two-year impasse, legislators in Illinois were able to pass a state budget that reinstitutes an R&D tax credit and implements workforce development programs. In California, the Governor’s Office of Business and Economic Development (Go-Biz) will see a 28 percent increase in funding, while other innovation initiative are receiving level funding. In other states whose budgets SSTI analyzed this week for TBED-related funding, we found that Innovate Mississippi was able to maintain state funding and new funding was appropriated for workforce development at the state’s community and junior colleges; a variety of programs were cut in North Carolina; and, Ohio will not get funding for a state office focused on commercializing research across key industries that the governor had proposed. More findings from California, Illinois, Mississippi, North Carolina and Ohio are detailed below.

SSTI’s annual conference will focus on building bridges for a better future by establishing new connections and wading through an uncertain political climate during a three-day conference filled with tips and insights. The agenda is now online at ssticonference.org and early bird rates are available. The conference, held in Washington, D.C., Sept. 13-15, will feature speakers on innovation, capital, policy, workforce, R&D, manufacturing and more.

A new survey released by the Pew Research Center reveals a much more negative view of the  impact of colleges and universities on America on the right, with a majority (58 percent) of the Republicans and Republican-leaning independents surveyed saying that colleges and universities have a negative effect on the country compared to 45 percent last August. Democrats and Democratic leaning independents (72 percent) say the colleges and universities have a positive effect.

The White House Office of Management and Budget sent a letter directing all agency heads to prepare FY 2019 budget requests with the figures provided in the administration’s FY 2018 request.

Washington, D.C. – From teaching high school students in rural western Kentucky how to become entrepreneurs to connecting entrepreneurs with a worldwide network of partners in a virtual hub, organizations are finding innovative ways to build regional prosperity.

The Economic Development Administration (EDA) announced approximately $30 million in funding for the Assistance to Coal Communities (ACC). As part of the FY 2017 appropriation for the Public Works and Economic Adjustment Assistance (EAA) programs, the ACC will assist communities severely impacted by the declining use of coal through activities and programs that support economic diversification, job creation, capital investment, workforce development, and re-employment opportunities.

On June 14, the Appalachian Regional Commission (ARC) announced $15.7 million in funding to support 18 projects (including those of two SSTI members – LaunchTN and Ohio University) that will help grow the economies in coal-impacted communities in seven states. With this latest announcement, ARC has invested over $92 million (leveraging an additional $206 million in investments) to diversify the economies in 250 coal-impacted counties across 11 Appalachian states through its POWER (Partnerships for Opportunity and Workforce and Economic Revitalization) Initiative. The new round of investments are intended to create and retain hundreds of jobs in advanced manufacturing and tech industries; support entrepreneurial development efforts, and, build workforce pipelines through institutions of higher education.

Massachusetts Gov. Charlie Baker announced a legislative proposal that would provide $500 million over five years for the life sciences sector, extending the state’s commitment to the biotech and medical technology industry. The money would be used for strategic investments in public infrastructure, research and development, workforce training and education.

Earlier this month, the White House released an executive order to expand apprenticeship programs and to study other federal workforce initiatives. The administration will attempt to reduce regulations for “effective” efforts while reducing funding for other programs.