Transcript NGA Power Point Template

Policies to Grow
State Economies
Erin Sparks
CSG-WEST Annual Meeting
July 31, 2013
U.S. Not Getting Back Many of the
Jobs Lost During the Recession
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Recent Trends Suggest U.S. Economy
Has Turned Soft on Risks
• Companies add jobs more slowly
• Investors put less money in new ventures
• Americans start fewer businesses and are
less inclined to change jobs or move for new
opportunities
• All three reverse prior trends
Source: “Risk-Adverse Culture Infects U.S. Workers, Entrepreneurs”, WSJ, 6-3-13
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Economic Development
in the State of the States
The top 100 words governors used when discussing economic development
in their 2013 state of the state addresses.
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Economic Development
in the State of the States
• Governors are still talking about business attraction, but
they’re
talking
about
startup
companies,
entrepreneurship, and growing businesses in the state
just as much.
• Governors are focused on supporting on innovation and
entrepreneurship.
• With the new focus on “growing from within”, governors
are launching partnerships and tools to help existing
businesses grow and stay competitive.
• Most governors are talking about lowering taxes to
create better business conditions, but some governors
did discuss raising taxes.
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Where Does Growth Come From?
Role of EDUCATION, WORKFORCE & ECONOMIC DEVELOPMENT Policy
An Action Plan for Growth:
12 Actions
Distinguish among
different entrepreneurs
and companies; target
resources accordingly.
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State of the States Excerpts: Growing
From Within
• Wisconsin: Most new jobs are going to come from new businesses
created here or from small businesses growing in our state. We need
to help them tap into the capital they need to make investments that
will lead to more jobs.
• Colorado: We hope to partner with the Secretary of State and fund a
comprehensive “suite of business services” that will give
entrepreneurs additional resources to grow their businesses.
• Illinois: We're partnering with the University of Illinois and the
National Center for Supercomputing Applications to create an
advanced manufacturing hub where companies - big and small - come
to learn and use the world's most sophisticated tools and software.
The Illinois Manufacturing Lab will make our manufacturers more
competitive.
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Cast a wide net.
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Not all entrepreneurs are twenty-something
“techies” – reach out to baby boomers
(“reinventuers”), women, immigrants.
Provide
entrepreneurship
training for
veterans and the
unemployed.
Find the high-growth
companies;
help them grow.
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Success Stories
• Innovation Works (Pennsylvania)
– Has invested more than $50 million in over 150 companies
that have created thousands of new jobs and attracted over
$1.2 billion in follow-on capital.
• Pipeline Fellowship Program (Kansas)
– Since 2007, companies led by Pipeline fellows have grown at
an average rate of 82 percent.
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Recent Initiatives
• Michigan’s Pure Business Connect
– $8 billion, multiyear initiative to help Michigan-based companies grow.
– Helps companies find new ways to raise capital, get access to various
business services, and connect with each other for business-to-business
procurement opportunities.
– Michigan is also investing $12 million in entrepreneurship support
services.
• Hawaii Growth Initiative
– Set of policies aimed at developing an ecosystem to support high-growth
entrepreneurial companies in the state.
– funded with $6 million, will focus on three main areas: mentoring,
collaborating, and funding opportunities for entrepreneurs to establish
and grow their businesses; leading partnerships between public and
private organizations to build research and commercialization activities;
and networking Hawaii’s businesses into broader U.S. and international
sources of investment.
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Reward strong ties
among universities,
companies, and
entrepreneurs.
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Offer R&D Funding in New Ways
Utah Science Technology and Research Initiative
(USTAR)
– Utah has invested a total of $977 million in
research teams and infrastructure, which has
generated $4.9 billion in new research funds and
$4.9 in new state revenues.
– The University of Utah generated more startups in
2011 than any other U.S. university.
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Utah’s Results
Source: Jack Brittain, Presentation to NGA, April 25, 2012.
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Helping Create Good Paying Jobs
in the State
Utah
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Utah
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Invest in Mega Partnerships
Virginia’s Commonwealth for Advanced Manufacturing
– State played key role in developing a “mega” partnership of
that provided tailored R&D and workforce to attract a Rolls
Royce production facility to the state.
– Partnership includes worldwide manufacturers, 3
universities, and the state.
– CCAM’s eight industry members, including Newport News
Shipbuilding, Rolls Royce, and Siemans, make sizable
contributions to the partnership, drive university research
to be production ready, and provide direction on workforce
strategy.
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Recent Initiatives
• Maryland Innovation Initiative
– Partnership between the state and five academic research institutions.
– Created the role of “site miners” to make connections between partners.
– In order to access funding that will assist with the costs of
commercialization, university faculty and other entrepreneurs are
required to meet with a site miner, who will make sure their application
is business-oriented and champion the application during the review
process.
• Washington W Fund
– A combination of state, university, and philanthropic funding.
– Provides early-stage venture funds to promising companies that are
started at the state’s research institutions.
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Build ecosystems, not
programs.
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The Elements of the Innovation
Ecosystem
• Institutions that attract and support the people with the talent and
foresight to create new ideas;
• Industry networks that encourage interaction, stimulate further
innovation, help develop specialized services to support area
companies, and encourage cross-industry partnerships;
• Facilitation of entrepreneurship to commercialize concepts so that
ideas, and businesses based on them, grow in the area; and
• Cultural and social amenities constituting quality of life that motivate
knowledge workers and the innovation-based companies that rely on
them to stay in the area.
Source: Rosabeth Moss Kanter, 1995,
Harvard Business School
Who Coordinates Key Elements of an
Innovation Ecosystem?
Source: Mary Walshok, 2010
Institutes for Collaboration
•
Innovation is built in from the beginning as a core mission. Their job is to
build, nurture and link the elements of “an innovative place” – a local
ecosystem of people, institutions, and companies that all support the
innovation process.
•
They are building an innovation ecosystem for a particular industry
cluster. Connected to a particular industry from inception, they know how to
create consistency from research ideas forward through the commercialization
process to feed the industrial base within the state.
•
The institutes are not part of one university. They sit at the nexus of
multiple universities and aim for a “catalytic effect” that will produce results.
•
They depart from traditional university technology transfer efforts by
focusing on what is required “upstream” to bring new products out
“downstream”. The goal is not to focus on just ideas or just markets, but to
stimulate the entire innovation process in such a profound way that the state’s
entire innovation pipeline is transformed.
These Organizations Require
 Leaders who proactively find and nurture connections across the
boundaries and know who to connect with whom. Companies and
entrepreneurs need one point of contact that will connect them with all
the diverse resources they need.
 Speed and Flexibility in working with industry. For this reason,
non-profit organizations that operate outside of the
university/government orbit may be needed, but they must excel at
bringing together the resources of several universities.
 Industry Focus that allows innovation to be strategically targeted
at sectors that are promising to the state or region. At the same time,
however, there is a balancing act between being sector-focused (built
up around innovation process and network for one sector) and
bringing together research and companies from different disciplines
and industries.
 Space That Crosses Traditional Academic Boundaries so that
innovation results from different disciplines working together. Shared
research facilities push researchers, entrepreneurs and industries
beyond their specializations and allow for discoveries at the
boundaries of disciplines.
Evolving from….
Source: Regis Kelly, QB3
To this…..and…
Source: Regis Kelly, QB3
….To this: Institutes of Collaboration
Source: Regis Kelly, QB3
Institute of Collaboration
Source: Regis Kelly, QB3
Recent Initiatives
• Connecticut Innovation Ecosystem
– Funded with $4.8 million in its first year for four innovations
hubs to help scalable young companies start and grow in
Connecticut.
– Launched innovation vouchers program to help most
promising early stage companies develop their ideas and get
products to market faster.
• StartupNY
– Creates tax free zones near universities across the state in an
effort to create, keep and attract high-tech and other
startups and venture capital.
– Aligns with Regional Councils.
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Overarching Lessons Learned
• Companies within the state are most likely to create new jobs
and entrepreneurs leading the fastest growing companies
should be a focus of economic development efforts.
• States are emphasizing policies and programs that have strong
industry buy-in and participation.
• States are applying lessons learned from cluster strategies to
innovation hub strategies, which combines a cluster strategy
with a place-based strategy for entrepreneurship and
revitalization. Each strategy depends on getting public and
private leaders to work together to develop an ecosystem of
statewide proficiencies.
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