Is your state putting their innovation dollars into university innovation?
Over 30 states in the US and countless established and emerging innovation economies across the globe are actively supporting these funding programs. In our most recent report, over 30% of all gap funding support for university proof of concept and startup gap funding programs came from these agencies and initiatives.
State, regional, and federal governments are a growing source of funding for translational research, proof of concept, and startup funding often in collaboration and support of opportunities stemming from research institutions. These initiatives are motivated by the promise of economic development, and business and talent development/attraction/retention.
We conducted an initial review of state-based programs that directly support translational research, proof of concept, and startup gap funding programs at their research institutions and have presented that draft below. We also included two, newer federal programs (the EDA i6 Challenge and NSF iCorps) that are ecosystem-based and require state-university collaboration.
Note: The map above is an initial draft based on our survey of state-support university POC and startup funding programs. If you would like to add a program, please note it here and we will update the map
Source and Operation:
Funding for these programs are typically tied to economic development or strategic investment offices and usually sourced from:
- Pooled agency operating budgets towards strategic or politically motivated technology and industry priorities (e.g. cleantech, life sciences, healthcare, etc.)
- Re-investment from tax revenue, legal settlements, or other windfall
- Small percentage of state pension or other strategic investments (with associated ROI expectations)
In most cases, state-supported programs are competing against other public programs or priorities and under constant pressure to produce. Agencies, legislatures and leaders that champion these funds must understand the breadth of gap funding opportunities, their corresponding time horizons, and manage expectations accordingly. It is also important to make sure that the impetus of the fund is strategic, rather than political, as a successful effort must operate above partisan lines.
States represent one of the most natural partners in early stage technology development and commercialization because their primary motive of economic development, not direct return on investment, often aligns better with the risk involved in seeding new, breakthrough industries. Additionally, their motivation to support closely associated programs at their educational institutions, can make them a good partner through capital dedicated towards gap funding programs, or through support policies or services like:
- Tax incentive programs including angel/investor tax credits (27 US States) and R&D investment tax credits (40 US States)
- State accelerator, business development, and incubation services
We have collected over 214 stories of state-based gap funding operations at our Mind the Gap website:
Here are a few examples:
- State Investing to Make Connecticut More Attractive to Tech Startups
- Invest Georgia putting state’s money to work
- BC $8.7M Investment Unlocks Canadian National Initiative To Accelerate Discovery And Innovation
- Center for Innovative Technology (CIT) of Virginia releases 2016 annual report on research commercialization and funding