i6 Grant Challenge Informational Session

June 19, 2012


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USPTO-OCIO
JUNE 19, 2012
i6 GRANT CHALLENGE INFORMATIONAL SESSION



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	>> Ladies and gentlemen, we will be starting the information session for the i6 Challenge in just a few short minutes.  
	good afternoon, everyone.  Thank you for joining us for this webinar to discuss the Economic Developent Administration's i6 Challenge for 2012.  
	For those of you who are joining us, please note that this is by WebEx, and you can type in your questions in the end off to the chat box on your screen.  
	The agenda for today is I am going to give a brief overview of the i6 Challenge, the objectives, the history of the program, and then take questions and answers from the audience.  My name is Nish Acharya, and I am Director of the office of innovation and entrepreneur and Senior Advisor to the Secretary of Commerce, and I manage the office of innovation entrepreneurship that managed the i6 Challenge.  
	So with that, we are going to switch over to the PowerPoint.  
	
	So a little bit of background about what the centers for innovation and entrepreneurship or the proof of concept centers that universities, nonprofits, and research consortiums have set up and what's been the objectives for the institutions as well as for economic development in the regions where those institutions are based.  
	And the crux of it, these research consortiums and universities and nonprofits have been looking for a structure to address global challenges and to harvest the ideas that are percolating in their organizations.  Obviously, research institutions and universities are a hotbed for ideas in our society across the board, from engineering to science to education to public health to anything.  And the vast array of ideas that are present, one of the big challenges has been how to harness those ideas and make them useful from an economic and value-add perspective.  
	And the proof of concept center model is one of the latest ideas in terms of harnessing that.  And so a structure to address global challenges has been critical.  
	Secondly, these organizations are looking to increase commercialization of ideas, research, and development.  And I want to emphasize the ideas because oftentimes the work here has been focused on commercialization of technologies, and I think what we're actually trying to achieve is a broader culture of idea, commercial idea, operationalization across the organization.  And it's not just about R&D, it's not just about technology.  It's about ideas and making them into real value-add for citizens of the world.  
	Thirdly, it's about creating a community of professionals, researchers, supporters, faculty and students, and others in the community, thinking about the relevance of their research and innovation.  And it's about engaging entrepreneurs, business leaders, and investors directly with ideas and research breakthroughs.  So the old model of finishing your idea in technology or your program and then shopping it to potential partners and investors has changed, and those folks are now involved at the earliest stages of the research all the way at the idea stage to help engage.  And for these nonprofits and universities and research consortiums, this is also a new and exciting revenue stream, both in terms of traditional supporters for universities, its alumni, but also from the success of these companies that are spun off. 

	From an economic development perspective, there's been two real motivations behind supporting these proof of concept centers, these centers for innovation and entrepreneurship.  First and foremost is the realization that an innovation and entrepreneurship ecosystem is what generates local companies and industries in a systemic and a consistent manner.  So while regions have tried to recruit companies from other countries for many, many decades now, historically that's been shown to be expensive for many, many regions.  It's too expensive and also a very time-consuming process, during which time a region can innovate and launch many start-ups through its existing base of research organizations and universities.  
	And secondly that this ecosystem will sustain, so this will continue year after year after year, and start-ups will continue to grow.  Over the last five years, several reports have shown that most of the job growth in the United States has been through start-up companies, and so that, combined with the fact that it's much harder to recruit larger companies, means that building your own entrepreneurial ecosystem has become critical.  
	And secondly for economic development professionals, it's a wonderful way to retain local talent, ideas, and capital and put it into local companies.  So that's been essentially how the model has grown.  
	But if we step back a minute and say how has this been organized and what was sort of the impetus around this?  Next slide.  When this idea came about about a decade ago, what many research institutions and universities were asking is how do we organize and focus our research areas to drive innovation and entrepreneurship?  So if you take a large research organization like SRI or Battel or a large research university like a major state university or private research universities, they would have major centers of research in things like the automation of work and information or IT, improving human health, shrinking global distances, improving agricultural productivity, or creating access to capital and financial services for more people.  
	I deliberately have worded it this way instead of calling it IT or life sciences because I think the -- while life sciences, for example, may be the sector that encompasses their research around medical devices and diagnostics and drugs and other things, really, the objective, as the institution was thinking about it, was how to improve human health, and that helped drive a culture that was more entrepreneurial with a small e, where research is being conducted, but people are thinking about the pathway towards research, that idea, that improvement actually impacting the human condition.  And that was the case with transportation and logistics, with IT, and with some of these other areas; that the objective was large-scale implementation.  
	So as these institutions started thinking about how do they organize themselves to stay focused on their research, the question became what are the key areas where they can think about this?  What are the key characteristics for each research area that are similar, and how do they develop this?  
	If we can go to the next slide.  So when we look at this, most of these institutions said that there are several components, three particularly, that each sector had in common.  That was innovation, entrepreneurship, and scale.  And when they were thinking about innovation, it was very much around key improvements in products and services.  Oftentimes when we think of innovation, we think of a big, big breakthrough in a technology or product or service when, in reality, many innovations are process improvements, business model improvements, slight improvements to an existing model or service.  Nonetheless, it is an innovation with a new business model and a new opportunity to provide impact to the world.  
	Secondly was entrepreneurship.  Another way to look at that was the word "leadership," and that was essentially how do we identify the people who will own these ideas, technologies, products, or services, and how do we build up their skill level?  And that may be an academic, that may be a graduate student, that may be somebody from the outside who has taken a keen interest in this idea or technology.  And how do we boost their skill-set in terms of their managerial skills, in terms of their understanding of business development, and how do we connect them to the right people to help them launch this idea?  
	And thirdly was scale.  One of the things that these private research consortiums, universities, and others have in common is really their global reach and the quality of their global faculty.  And so when we think about that, we think about scale.  And obviously, if a company is to grow at scale, they, themselves, have to build up their products and services and sell to customers, but the role of the institute in that cannot be diminished.  They have board members, they have alumni, they have faculty who are globally connected and can clearly facilitate this process in a significant way.  
	The four things that many practitioners -- proof of concept, many of the centers have in common revolve around these three buckets, and that is that many of them create some sort of an innovation cycle within their organizations whereby ideas can be harnessed, to be discussed, to be experimented with through some catalytic grant making, which can be as small as $500 and can be as large as $50,000, and that grant making is used to experiment, to implement the experiments and ideas, and then a robust learning cycle is created within the organization where the ideas are then shared and determined whether there's future opportunities or not.  
	Again, the difference with the proof of concept center is bringinging in the outside networks to essentially participate in this idea generation, experimentation, and learning early on to determine the market feasibility of those ideas.  
	Thirdly, many of these proof of concept centers spend a lot of their time and energy on building strong networks of outsiders and inside faculty from multidisciplinary perspectives who can come together and share with the researcher, the investigator, the student, their expertise and engage with them.  
	Finally, the institutions have been big at creating a nurturing infrastructure for their idea generators and their researchers, and that's essentially things like intellectual property support through support for patent filings and disclosures; it's courses around business planning; and mentorship; and access to outsiders who can help them with that in a structured manner.  
	And nurturing infrastructure has been critical in the operational side of growing this.  Next slide.  
	So that brings us to the 2012 i6 Challenge, and this is the third annual challenge, i6 Challenge, to create senfers for innovation -- centers for innovation and entrepreneurship or proof of concept centers.  This year we're providing $6 million from the Department of Commerce Economic Developent Administration, and that will each be for six winners, one in each region of the Economic Developent Administration.  In each of our six regions, we'll pick one winner with up to a million dollars, and that will be selected in partnership with the regions and the Washington office of the Economic Developent Administration, although each region will ultimately pick the final winner based on a variety of criteria that are laid out in the federal funding opportunity.  
	The link I've put here in the slide at eda.gov, you can connect to the funding opportunity as well as the FAQ sheet about i6 and some historical data about i6.  Additionally, the National Science Foundation will provide up to $3 million for new and existing SBIR grantees that are part of or central to the awarded six winners.  Finally, other agencies will review the process.  
	This year we are going to identify our finalists and make their applications publicly known -- their names publicly known as well as share their applications with their permission with other agencies that may be interested.  So many of you will remember that the Environmental Protection Agency, the U.S. Department of Agriculture, the National Oceanic and Atmospheric Administration, the Department of Energy, and others have participated in i6 in the past.  This year because we provided a general challenge, those agencies will receive those finalist applications and review for potential funding opportunities.  We expect some of those agencies to provide additional funding in a similar manner that National Science Foundation is providing it.  So that will happen in August as well. 

	Next slide.  To review, we've had 12 winners to date, and to just quickly go over the previous winners, in 2012, out of the Atlanta region, we had the global center for medical innovation that's anchored at Georgia tech university.  We had the New Mexico Technology Ventures initiative out of the Austin office.  The University of Akron and Austen Bio innovation Institute was selected.  The buy Joe generator, done with a variety of partners, including Washington University, University of Missouri, Danforth center, and the St. Louis economic and development councils was selected by our Denver office.  
	Innovation Works and Carnegie Mellon were Pittsburgh-based organizations selected by our Philadelphia office.  And the Oregon Translational Research and Drug Development Institute and Oregon built environmental and sustainability technologies center was selected out of our Seattle office.  
	In 2011, the focus was on green technologies or clean tech.  And for those winners, we selected the following.  We selected University of Central Florida, igniting innovation, Florida i2 clean tech network, University of Florida, and TRDA.  This is, again, out of our Atlanta office.  
	Out of the Austen office, Louisiana tech was selected, and Michigan State University out of the Chicago office.  Out of Denver, we had the Iowa Innovation Network, along with a series of partners, Iowa economic development department and Iowa State.  
	Out of the Philadelphia region, we had the New England i6 Green Partnership with the New England clean energy foundation, and finally out of Seattle, we had the Washington clean energy partnership.  
	Each of those winning the 2011 i6 had a clean tech focus, but several had focuses around biofuels, while others had clean tech more of a traditional energy is focus, and as a result, the Environmental Protection Agency and Department of Energy and others were excited about the diversity of how we define clean tech and how our institutions were thinking about it.  
	With the 2010 winners, we are now starting to see some initially very exciting results.  They are about two years in now, and several of these centers are certainly generating significant ideas or building vast networks of professionals, technical experts, academics, and others to help with their start-ups.  And they are starting to spin out companies as well.  
	Next slide.  
	If we go over the funding opportunity objectives for this slide -- for this challenge this year -- there's really four areas that we defined in the funding opportunity:  Innovation, entrepreneurship, regional economic development, and commercialization.  
	And as we've laid out here and in the funding opportunity, each is slightly different but very connected.  Most importantly, I will note that the activities that a center will do to fund ideas and to bring in and build a network of outsiders all overlap in terms of their ability to impact innovation, the entrepreneurship, the commercialization, and keep those companies local.  So in fact, while these are separately defined, there's also significant overlap in terms of the people that are working on this.  
	So with innovation, we are looking at projects to nurture innovation very broadly and markets for that specifically.  This is a broad-based culture of idea generation and useful applications for the innovation, or relevance as it is often called; research and development with universities and research centers; it's the engagement of a diverse set of researchers, innovators, and practitioners with, again, diversity being defined in a variety of ways, as is relevant for the institution and the multidisciplinary approach that they may want to engage in.  And then engagement with industry professionals, investor, and successful entrepreneurs at the earliest stages of that innovation to help understand what breakthroughs, what further research are needed in order to create a viable enterprise. 

	And that last one is a little bit different from the entrepreneurship part of it, which is why I mentioned the overlap.  Because the entrepreneurship is certainly focused on the business development, the enterprise creation, but oftentimes there's overlap with identifying the right innovation and where the innovation needs to go technically before it can become an entrepreneurial activity.  
	With entrepreneurship, we are looking at these proof of concept centers to become really a -- the center of a large number of high-growth entrepreneurs across disciplines and across regions to help entrepreneurs experiment and commercialize innovations.  And this can be educational programs, which does not have to be limited to courses are you can be limited to a variety -- but can be limited to a variety of activities, internal and externally, to support the training of people to become entrepreneurs.  And secondly, it's the growth of the ecosystem as measured bier start-ups, participation, idea generation, and a variety of metrics the institution may develop to create an ecosystem to drive job growth in the home region.  
	Next slide.  For regional economic development, we are looking at projects that -- where innovation is really driving that economic development.  And one of the best ways to do this is the presence of special events to showcase technologies and to showcase entrepreneurs for both the exchange of ideas and the formation of new collaboration partnerships.  And a lot of that has to do with the operational challenges to identifying innovation, and the proof of concept center's key role is the convening power that it holds to bring people together and share not just ideas in an academic sense, but also to showcase existing technologies and the immediate opportunities that are with them.  
	Finally, it becomes an opportunity to engage with local business associations and governments to ensure that the high-growth entrepreneurs are a part of the local business community.  Oftentimes, particularly with the research institutions and universities, the intellectual property, the ideas are commercialized, but they're commercialized somewhere else.  And when you think about all of the great companies that have been started in one place but built and created significant jobs in another, this is something that economic development professionals are looking to change.  
	Last big area is commercialization of research.  We're looking for projects that convert ideas, research, and prototypes into viable products and services that can be Monday advertised and brought to market -- monetized and brought to market in a financially manageable and rapid manner.  
	This includes the incorporation of mentors and industry catalysts to provide advisory services very early on to, again, understand the opportunity.  
	It's access to seed funding within the institution that hosts the proof of concept center to further along the business modeling and further along the targeted focus of the research, which may or may not be different from the initial focus of the research, and the federal funds or private funds that have been received to fund the research.  
	It's assistance with market evaluation and business plan development.  And finally, it's the creation of processes within the proof of concept center that integrate scientific review with market potential to accelerate the best ideas from lab to market.  
	The Economic Developent Administration has a very strict and well-defined set of eligibility requirements.  On the left is a table listing the types of organization that is can apply for economic development funding, including district organizations, Indian tribes or consortium of tribes, states, cities, and political subdivisions of the state.  Institutions of higher education or consortium of research organizations and institutions of higher education.  Finally, public or private nonprofits or associations acting with the state.  
	In the region where the i6 center is based and the project occurs, or a subdivision of the region, must meet the economic distress criteria.  We will most likely be hosting another webinar on this topic, based on the number of questions we've had from potential applicants in the past and potential applicants this year about the EDA requirements and how should they think about their region or their application in that context.  So please stay tuned to find out more about that next webinar.  
	And also on pages 11-19 of the funding opportunity that's on the website, you can also learn more about our requirements to apply for the i6 Challenge.  
	Next slide.  EDA has some basic eligibility and requirements for the i6 Challenge, as it does for many of its grant challenges.  And here are some of the background about it as well.  
	The project period is expected to last up to three years.  The fund something provided through existing economic adjustment assistance programs.  The project should advance innovation and entrepreneurship into enterprises and organizations capable of leading to job creation, expanded markets, economic growth, and global competitiveness.  
	EDA encourages projects that promote the repatriation of jobs back to the U.S., retain and grow domestic investment, attract foreign direct investment, and increase exports.  
	And applicants must be able to demonstrate a matching share from non-federal sources.  Now, I understand there's a lot of questions in this space as well, and so we hope to take questions today, but also expand on that in the future.  
	Next slide.  
	Here's a little bit about the i6 review process.  The applications will be due on July 20, and please see the FFO, again, for details about the application materials that we'll require as well as any eligibility questions you will initially have.  
	We will then have our EDA offices, which will conduct an application and eligibility review to determine the eligibility of the application itself, if it fits the technical merits.  There will also be a merit review to evaluate the proposals along those four criteria areas, innovation, entrepreneurship, commercialization, and regional development.  And there will be a policy review and recommendations committee that will consist of senior officials from various agencies as well as a panel of expert judges in this space who will review and look at a variety of factors and make recommendations for final selections.  And then the EDA regional offices, in coordination with the EDA headquarters in Washington, DC, will make the final funding decisions, and we expect that towards the end of the summer early in September. 

	Next slide.  
	A little bit of information about the FFO.  It can be found at grants.gov or at this website, EDA.gov/challenges/i6, and the funding opportunity number is i62012.  If you have any questions, we do have an email address set up, and that's i6@EDA.gov, but I would strongly urge all of you to contact the person listed in the FFO as the regional point of contact.  And so EDA has six regions, and each of those regions there is an identified staff person with the email address and phone number listed who is the main contact for your region, and we strongly urge you to first communicate with those individuals, and if you send an email to this address, it will be forwarded to your regional coordinator for the i6 as well.  And so we strongly urge you to start there.  
	With that, as I mentioned, we'll probably do some more informational sessions around the questions that arise out of this webinar as well as other questions that have come up from applications that are more specific in nature.  But for now, this is the overview of the 2012 i6 Challenge.  Thank you.  
	We're now going to answer some questions that have come through on this.  
	On the question of eligibility limitations, the FFO identifies what the Economic Developent Administration will fund for the i6, and there's an earlier slide, if we could go back.  
	And this is, again, how EDA defines the types of organizations that can apply, and then secondly, in the funding announcement itself, there's some information about what economically distressed area actually is defined as.  
	I want to make a correction.  One of my colleagues at EDA has mentioned that the project period is actually only allowed to be up to two years, not the three years, so my apologies for that incorrect information.  
	On the question of -- other questions here.  
	These slides will be posted shortly.  
	Question about the emphasis on ideation rather than commercialization.  I would suggest that the two are not separate.  Essentially, the reason for focusing on ideation was to not define it specifically by traditional technology transfer definitions for commercialization, which is often included just engineering or just life sciences.  What we are looking at is focusing on ideation broadly so that a broader segment of the research community, of the university community, of the partnerships of these nonprofits can apply.  So essentially, we are talking about a process for greater commercialization, but I wanted to be clear that it was not around the same topical areas -- it was not around a narrow set of topics but around a very broad set of topics that exist across -- across the community, across the institution, or what have you. 

	We have a question on the matching requirement.  Is that 100% match requirement?  Again, I would refer you to the FFO that states out how the match actually works.  
	We have a question on the limitations of how the money can be spent.  There are some limitations about how the money can be spent in terms of going directly to the winning organizations and directly to companies because the EDA does not fund companies directly.  But again, I would urge you to look at the FFO to see some of the answers for how EDA will fund some of these things.  
	We have a few more minutes for questions if people want to ask questions.  
	One person has asked what does "high growth" mean?  That is a -- really, a open question.  High-growth entrepreneurship is traditionally thought of as entrepreneurship around technologies or innovations that have the ability to rapidly impact a large number of people.  Essentially, some of the information technologies that can spread rapidly through the Internet or those technologies that, with the appropriate amount of capital, could quickly scale up through existing companies or other vehicles.  
	And so "high growth" has traditionally meant that.  I think the way the economy is changing so fast today, we want to expand the definition of "high growth" to be more than just some of those traditional areas.  Also, because many of our regions, many of the people applying are not in areas where venture capital is abundant, and so when we think about high growth, it can't just be not something that's BC backed, we have to think about other -- VC backed, we have to think about other companies.  
	We do -- somebody has asked about previous project-awarded grants, and we do have some brief summaries of those that we can share with people, and we'll add that to the website in the coming days and weeks.  
	We've got a question about special needs to meet EDA regional economic distress signals and manufacturing jobs that have moved from a specific region.  There, the EDA in the FFO has outlined what is the definition of "distressed region," and one of those categories is around significant job loss.  So that is an area that would fit, depending on what the situation in that particular community was.  
	 -- if the specific focus is on manufacturing, and the answer is no.  Certainly, if that is an area where an application would like to focus, they are more than welcome to, but all of the applications do not need to be about manufacturing.  That is really a decision about relevance as it relates to the local region and the local application.  
	Another question is around universities as a requirement of the partnership.  The answer is no.  Once again, EDA eligibility is across these different types of organizations.  Oftentimes, universities and private research centers are the hubs of idea generation and research in a city or a region, and so they often become partners, but it is not a requirement.  
	We have a question about the -- refocus the i6 center for jobs driver for the region.  
	so while it is important to measure jobs created out of the i6 centers, one of the beauties of the i6 centers, the proof of concept centers, is their ability to uncover ideas and possibilities that weren't previously known.  So these are new technologies and how to apply them that had not been thought of before.  And so when we're thinking about it as job drivers, I think the critical thing is -- and research has shown this -- the experiences of some of the best practices is that less of a top-down job creation in a specific sector and more of how do we create the nurturing environment so that the start-ups that do come out are able to maximize their job growth in the region.  And so the best centers don't have -- they certainly have sector focuses, but it's very broad, and it's not targeted around a specific emerging industry with a -- with an analytically set job creation objective. 
It's more about bottoms-up nurturing with the hopes and planning to actually responsible job creation. -- support job creation.  
	Someone is asking about partnerships we are looking for in the applications.  The application, in terms of partnerships, again, one of the values of the proof of concept center is building the network that can come in and help the innovators understand the business plan, the opportunity, the low Han hanging fruit for them -- the low-hanging fruit for them to follow, and to develop their ideas and technologies into companies.  
	So in many ways, the more partnerships that a proof of concept center has, the more likely they are to succeed.  However, obviously, when you are talking about sharing funds and partnering together, that's not always the best scenario either.  So we're talking about partnerships that will help you to leverage the innovation in your institution, to find the -- their needs to grow and succeed, and so that could be a technical support in terms of intellectual property.  That could be networks with the investment community, it could be other organizations that subelement and complement the research in your organization, and other things of that nature.  
	Someone has asked about the amount of partnerships that have to be in place, and yes, as part of the application, the -- it is expected that you will list your partners, and so it would be expected that those partnerships are legitimate and that the organizations have a relationship in place in a formal manner.  
	Does the technology have to be proven is another question we've received.  The answer to that is a qualified no.  Part of the objective of the proof of concept center is to actually receive funds to prove the commercial value of a technology.  Certainly, the technology will have gone through the research and experimentation phase from a technical perspective, but the part of the proof of concept center work is to showcase the commercial aspects of it and to find the commercial opportunity for it in reality.  
	So it needs to be proven, and many of the centers actually have a scientific peer review process in place before they are chosen -- the winners are chosen for receiving funding from the i6 center.  
	We have time for a few more questions.  
	Someone asked if we can support and encourage high-growth ideas that do not have technology.  Such as service companies.  And the answer is yes.  The objective here is to identify innovation, entrepreneurship, and to grow these companies to create jobs.  And so under that broad canopy, service companies would qualify, and again, the objective is for the institution that hosts the i6 center to have robust systems to select those.  And so hopefully the service company will have fit through that selection process as well.  
	Several people have asked about the distressed criteria.  Once again I would urge to you look at the funding opportunity which lists the various distressed criteria and also contact your regional rep that's listed in the i6 FFO about that.  
	Great.  Well, if we don't have any more questions, I want to thank everyone for participating, and then please follow up with us by email through your region contacts for other questions that you might have.  Thank you very much.  
	

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This text is being provided in a rough draft format.  Communication Access Realtime Translation (CART) is provided in order to facilitate communication accessibility and may not be a totally verbatim record of the proceedings.
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