TIP Strategies is a privately held Austin-based economic development consulting firm committed to providing quality solutions for public and private‑sector clients.
This blog is dedicated to exploring new data and trends in economic development.
By: Devin Thorpe
If money is the only thing stopping you from doing something good in the world, stop waiting and start doing some good!
Nothing better symbolizes entrepreneurship than fundraising. Social entrepreneurs are no different. Today, there are a host of on-line resources for crowdfunding that social entrepreneurs can use to fund their projects, films, books, and social ventures. Today, I’ll briefly profile eight.
1. Kickstarter.com: Kickstarter is the 800 pound gorilla in crowdfunding, originally designed and built for creative arts, many technology entrepreneurs now use the site, some reporting to have raised millions of dollars. The Kickstarter funding model is an all-or-nothing model. You set a goal for your raise; if your raise exceeds the goal, you keep all the money, otherwise your supporters don’t pay and you don’t get anything. This protects supporters from some of the risk of your running out of money before your project is completed.
2. StartSomeGood.com: StartSomeGood, which I used to raise some money for my book, Your Mark On The World, is great for early-stage social good projects that are not (yet) 501(c)(3) registered nonprofits. StartSomeGood uses a unique “tipping point” model for fundraising, allowing you to set a funding goal and a lower “tipping point” at which your project can minimally proceed and where you will collect the money you raise.
3. Indiegogo.com: Indiegogo allows you to raise money for absolutely anything, using an optional “keep what you raise” model with higher fees or pay less to use an all-or-nothing funding approach.
5. Pozible.com: Pozible, run from Australia, has a global platform for all types of projects, emphasizing “creative projects and ideas” and specifically precludes fundraising for charities. Pozible operates with an all-or-nothing funding model.
6. Causes.com: Causes is designed specifically for 501(c)(3) registered nonprofits to raise money. The fees are low and all donors on the site understand that all of the contributions will be tax deductible. Causes is widely used to launch “action” campaigns, like boycotts, petitions and pledges rather than fundraising campaigns.
7. Razoo.com: Razoo boasts that it has now helped 14,000 causes raise over $100 million. This site is exclusively for social good causes but is not limited to 501(c)(3), using a keep-what-you-raise model, charging just 2.9% of money raised.
8. Crowdrise.com: Crowdrise is a site for 501(c)(3) charities to raise money, with the novelty being that anyone can sign up to volunteer to launch a fundraising campaign for a charity already registered on the site. Everyone can instantly become a social entrepreneur for a cause they believe in.
All of these sites are making great things happen for real people every day, advancing the arts, entrepreneurship and philanthropy in myriad ways. Check them all out and decide which one is the best for you.
Note that in general, the tax deductibility of donations made on these sites is determined by the tax status of the organization to which you donate and not by the crowdfunding site used. Donations made through any of the sites to a 501(c)(3) registered nonprofit will generally be tax deductible for U.S. donors who itemize deductions on their tax returns. Check with your tax accountant if you have questions before you make a donation.
By: Laylan Copelin
Via: Austin American Statesman
With a shortage of lab space in Austin, many companies have turned to the Georgetown facility, where Jennifer Erdman, left, and Katie Young work.
Austin, conventional wisdom goes, has all the ingredients for economic success: an entrepreneurial ecosystem at the doorstep of a top tier research university in a state perennially praised for its business climate.
Yet its biotechnology sector suffers from a missing link: Wet lab space for early startup companies is in such short supply that intellectual property discovered at the University of Texas is being commercialized at labs in Georgetown, Abilene, Dallas and points beyond.
Wet labs have the appropriate plumbing, ventilation and equipment to allow hands-on research and experimentation with chemicals, drugs or biological materials. Without enough of them, Austin risks losing startup companies and the good-paying jobs they can produce, industry officials said. And research labs are an element in Austin’s quest to expand its economy with a medical school and teaching hospital over the next several years.
“There is a deficit of wet lab space that is going to retard biotechnology in Austin,” said Isaac Barchas, director of UT’s Austin Technology Incubator, or ATI. Janet Walkow said that when she took over as director of UT’s Drug Dynamics Institute four years ago, she was swamped with phone calls from biotech startups looking for lab space.
Why the shortage? “I ask that question every day,” Walkow said. “I’m just befuddled.” Cindy WalkerPeach, who leads ATI’s biotech division, has studied the issue with the help of a federal grant. “It will require 60,000 square feet of wet laboratory space just to meet the demand of current companies,” WalkerPeach said. To address that, WalkerPeach’s feasibility study envisions a 150,000-square-foot wet lab facility at the Mueller development — a facility that would come with a price tag of $80 million. “That’s a lot of money,” Barchas acknowledged.
But WalkerPeach’s study says the facility could generate 275 to 740 jobs — not counting indirect jobs created by the investment — and have an economic impact of $40 million to $110 million over five years. The Mueller site is preferred because of its proximity to the University of Texas, local hospitals and a possible future medical school. WalkerPeach estimated it could take 58 months to complete the plan, including a year to obtain financing. ATI has applied for a $255,215 grant from the U.S. Commerce Department’s Economic Development Administration as the next step.
Barchas said the grant, if awarded, will be used to investigate how to finance the facility, including a possible public-private partnership with an anchor tenant from the private sector. “If the grant is awarded, we will buy expertise to teach us how to raise the money,” Barchas said. In the meantime, Austin’s biotech startups are making do.
WalkerPeach said ATI recently lost a company to Dallas because it lacked adequate wet lab space. And Barchas said several of the incubator’s companies have contracted research with organizations in other states and countries. “Frankly, a number of our companies are operating in virtual labs,” he said.
That is not necessarily unusual. The life cycles of many biotech startups include outsourcing research because the companies cannot yet afford staff and equipment. A lot of that work goes out of state now. Eventually, though, many startups need their own small labs to prove their concepts before they can attract investors and grow.
Working with ATI, Walkow last year persuaded UT officials to convert space at the university into the UTech Dorm Room, about 1,000 square feet of labs. The City of Austin contributed $35,000 for equipment. “Once we opened our doors, people were just lined up,” she said. Three companies quickly leased the space.
An additional 5,500 square feet of old lab space in the North Pharmacy School building that has been set aside, pending a grant application for a cancer project, could be converted to wet lab space. While UT awaits word on the state grant, Walkow said, the space can be used by startups for a few months.
Others are conducting lab work in Georgetown at the Texas Life-Sciences Collaboration Center, 15,000 square feet of labs that opened in 2007. A collaboration by Georgetown, the Georgetown Chamber of Commerce and Southwestern University created the center, which is overflowing with eight tenants. Ground is scheduled to be broken on a second building this fall, and the center just signed an agreement to help commercialize technology expected to come out of the Texas A&M University System’s proposed medical school in Williamson County.
The center has also attracted out-of-state biotech startups. “We’re getting clients from the East Coast and West Coast,” said Russ Peterman, the center’s director. Xeris Pharmaceuticals Inc. moved from California to the Austin Technology Incubator in 2010. Saretta Ramdial, a company spokeswoman, said Austin has the right combination of talent, a startup environment, cheaper overhead and a central location that “can bring people here from both coasts.” Xeris outsourced its early research, but when it came time to create its own lab, there weren’t many options in Austin. “The limited spaces available to us were too large and too expensive,” said Nancy Scott, the company’s director of product development. “They would have posed too much risk to our company at an early stage.”
Georgetown provided the answer, though company officials said splitting operations between two cities is not ideal. “Eventually, we’d like to have all our office and lab space under the same roof,” Scott said. Peterman, who is accepting a new job as chairman of the Texas Bio Corridor Alliance, plans to urge the creation of more lab space. “If we are going to have this industry grow, it is absolutely essential to have wet labs,” Peterman said. “You won’t have these companies move to Central Texas without them.”
The Georgetown lab also has helped keep some homegrown companies in Central Texas. DisperSol Technologies, founded in 2007, arose from research at UT’s College of Pharmacy. Dave Miller, the company’s vice president of research and development, said he started as a UT graduate student working on a novel technology that makes new drugs more soluble. Today the company is making a drug product at its Georgetown lab for clinical trials. Miller said the company came to Georgetown because Austin didn’t have a small facility that met the federal standards for manufacturing drugs. Over the next several years, Miller said, the company hopes to triple its need for manufacturing space and stay in the Austin area.
He said company officials have deep roots in Texas. “We have our own personal reasons for staying here,” Miller said. After a startup leaves Austin for lab space, it won’t necessarily return to the capital city.
Bill Williams is a UT pharmacy professor and a co-founder of PharmaForm, a successful company that he and his partner sold in 2007. A second company, Enavail LLC, is developing drug products based on Williams’ research. Williams, who serves as an adviser at Enavail, said the Austin-based company located its lab in Abilene, a city of almost 120,000 people, about 220 miles northwest of Austin. That West Texas city has built a $10.5 million publicly funded facility to attract biotech firms. “It filled a void,” Williams said. Despite its Austin roots, Enavail won’t necessarily return after it develops its line of cancer therapeutics. “We’ve brought people there and hired locals,” Williams said. “We’re not going to ask them to move.”
Once biotech startups make it — and only about 1 in 4 does — they typically look for larger labs. The private sector fills that need. A San Francisco firm, Drawbridge Realty Trust, recently purchased two buildings in Austin that will provide a combined 30,000 square feet of office and wet lab space. Mark Pearson, a managing partner, said the firm is looking for startup companies that need 6,000 square feet of space or more. He said the typical prospective company already has received venture funding and is growing. He said Drawbridge is negotiating with several tenants. “We like the Austin market,” Pearson said. “It fits with what we do in Silicon Valley.”
But he questions whether Austin needs 60,000 square feet of wet lab space for early startups. “We don’t think it’s as big a need as others have thought,” Pearson said. He said that will change if the medical school is built. “That will drive the innovation and need for more biotech space in Austin,” Pearson said. “That’s what’s driven it everywhere.”
By: Kirk Johnson
Via: The New York Times
SEATTLE — The cultivated rusticity of a farmers’ market, where dirt-dusted beets are status symbols and earnest entrepreneurs preside over chunks of cheese, is a part of weekend life in cities across the nation as the high days of the summer harvest approach.
But beyond the familiar mantras about nutrition or reduced fossil fuel use, the movement toward local food is creating a vibrant new economic laboratory for American agriculture. The result, with its growing army of small-scale local farmers, is as much about dollars as dinner: a reworking of old models about how food gets sold and farms get financed, and who gets dirt under their fingernails doing the work.
“The future is local,” said Narendra Varma, 43, a former manager at Microsoft who invested $2 million of his own money last year in a 58-acre project of small plots and new-farmer training near Portland, Ore. The first four farmers arrived this spring alongside Mr. Varma and his family, aiming to create an economy of scale — tiny players banded in collective organic clout. He had to interrupt a telephone interview to move some goats.
Economists and agriculture experts say the “slow money” movement that inspired Mr. Varma, a way of channeling money into small-scale and organic food operations, along with the aging of the farmer population and steep barriers for young farmers who cannot afford the land for traditional rural agriculture, are only part of the new mix.
A looming shortage of migrant workers, with fewer Mexicans coming north in recent years, could create a kind of rural-urban divide if it continues, with mass-production farms that depend on cheap labor losing some of their price advantages over locally grown food, which tends to be more expensive. From the vineyards of California to the cherry orchards of Oregon, big agriculture has struggled this year to find willing hands. Local farm sales are becoming more stable, predictable and measurable. A study last fall by the Department of Agriculture said that local revenues had been radically undercounted in previous analyses that mainly focused on road stands and markets. When sales to restaurants and stores were factored in, the study said, the local food industry was four times bigger than in any previous count, upward of $4.8 billion.
More predictable revenue streams, especially at a time when so many investments feel risky, are creating a firmer economic argument for local farming that, in years past, was more of a political or lifestyle choice.
“How you make it pay is to get closer to the customer,” said Michael Duffy, a professor of economics at Iowa State University, capsuling the advice he gives to new farmers in the Midwest.
Labor, as it has been for generations in the United States, is still the big wrinkle for local growers. But in many cases, experts like Professor Duffy say, the local food system is increasingly going its own way, differentiated from the traditional labor pool of migrant workers that the United States’ mainstream produce system depends on. Many larger local farms hire Hispanic workers, but at more farm stands and markets, buying local also means, in subtle or not so subtle ways, buying native.
“A byproduct of local food is that local hands are more likely to be producing, harvesting, packing and marketing it, especially for new farmers on small-scale farms,” said Dawn Thilmany McFadden, an agricultural economist at Colorado State University who is part of a leadership team for a training program for beginning farmers.
In other instances, Hispanics who had worked as low-wage laborers are now becoming entrepreneurs. A three-year-old nonprofit group north of Seattle, Viva Farms, specifically aims to help Hispanic farmers get started, with assistance in language training and in understanding the vagaries of the marketplace.
“We work harder now,” said Misael Morales, 35, describing the main difference between life as a farm laborer and as an entrepreneur.
Mr. Morales came to the United States from Oaxaca, Mexico, as a teenager, and last year he and his brother, Salvador, 32, began farming a one-acre plot at Viva Farms. They mainly grow lettuce for markets and restaurants in Seattle.
“Early or late, when something has to get done, you do it,” he said.
Viva Farms’ director of business and organizational development, Ethan Schaffer, said former wage workers like the Morales brothers are often surprised when they realize the prices and profit margins that local organic produce can fetch — something, he said, that rarely penetrates down to the daily life of a migrant picker.
“They get the ag part, and once they realize how the market works, they’re off and running,” Mr. Schaffer said.
Other new farmers, like Christopher Brown, 26, a former Marine infantryman who worked his first day last month at Grow Washington, an organic farm north of Seattle, have more complex motives. Taking a break from the carrot-cleaning table, he says he dreams of building an organization to help bring other veterans into local farming.
Other urban-focused farms, including one in Oregon City, Ore., called C’est Naturelle, are offering, starting this month, one-stop shopping services: community-supported agriculture subscriptions to supply a family a full diet of food from one place, from eggs and butter to beef and greens.
Mr. Varma’s project near Portland, called Community by Design, was inspired, he said, by the Slow Money movement, which has emerged in recent years as a vehicle for financing local, organic food production through groups like Slow Money, a nonprofit group in Boulder, Colo., that connects investors, entrepreneurs and farmers. Of $18 million raised in the last two years by Slow Money, $4 million — the biggest chunk — landed here in the Pacific Northwest, said Woody Tasch, the group’s chairman.
But the economic path for local food is still in many ways difficult.
The federal farm bill, passed by the Senate last month, has provisions to support farmers’ markets. But in Washington State, a program aimed at helping growers build direct marketing relationships with grocers or restaurants died last year in a round of budget cuts.
For Jenny and Alex Smith, both 25, a couple since they met in college — now first-year farmers on a tiny plot about an hour north of Seattle — the economic equation comes down to lowering costs and needs.
They live in a recreational vehicle with no television or Internet service, and they hope to break even this year, earning perhaps $1,600 a month through farmers’ markets and subscriptions for weekly produce packages, so far mostly from friends and family. But they say a farming life still feels, to them, full of promise. They had boring office jobs in Seattle, they said, and now they have a farm dog named Banjo.
via The Atlantic and NPR
Today, at least 90% of the country has a stove, electricity, car, fridge, clothes washer, air-conditioning, color TV, microwave, and cell phone. Take a moment to savor this graph from Visual Economics, which shows the adoption rate of new technologies across the century:
One way to parse it is to ignore everything at the top and trace your eye along the 10% line:
– In 1900, <10% of families owned a stove, or had access to electricity or phones
– In 1915, <10% of families owned a car
– In 1930, <10% of families owned a refrigerator or clothes washer
– In 1945, <10% of families owned a clothes dryer or air-conditioning
– In 1960, <10% of families owned a dishwasher or color TV
– In 1975, <10% of families owned a microwave
– In 1990, <10% of families had a cell phone or access to the Internet
In his final of 3 posts, Derek Thompson of The Atlantic notes: “In 1900, less than 10% of families owned a stove, or had access to electricity or phones, and the Model-T was still a full decade away.” His first installment of this series followed shifting family budgets between 1900 and 2003. The second explained why food seems so much cheaper at the dawn of the 21st century. The third is different because it goes beyond numbers, to include issues of quality of life and the question of progress: “It’s not just that life expectancy at birth has grown from 49 years in 1900 to 78 today, but also the quality of our lives has been improved by law (e.g.: new safety and anti-discrimination laws), by culture (e.g.: women’s ascent in college and the workplace) and by technology.” (Believe it or not, the boom box was the fastest-adopted gadget of the last 50 years.)
Another piece from NPR traces the Birth of Silicon Valley. Now a well-known hotbed of innovation stretching along the peninsula southwest of San Francisco Bay, the story that emerges from this timeline is the transformative power of venture capital, as well as the onward march of technology. Click on the image below to explore the timeline.
By Christine Negroni
The old Town Hall in Stamford, Conn. has been renovated and will become a home for aspiring entrepreneurs.
STAMFORD, Conn. — The old Town Hall here, a Beaux-Arts building on the National Registry of Historic Places, has sat unused for 25 years, a victim of Stamford’s rapid growth in the 20th century. But the Town Hall will join the 21st-century economy, with the announcement this month that it would become an incubator for business start-ups in a 10-year lease agreement with private investors.
The Stamford Innovation Center, as the venture is called, is expected to open by summer, and aspiring entrepreneurs will get work space, mentoring and access to investors.
Acting as a corporate sponsor for the venture will be Sikorsky Aircraft, the helicopter maker and military contractor based in nearby Stratford, Conn. The company, a subsidiary of United Technologies, has leased 2,000 square feet on the building’s second floor, and will coach tenants and may even invest in them, said Chris Van Buiten, the vice president for Sikorsky Innovations, a network of employees focused on finding new technologies.
Sikorsky is priming the pump by issuing five technological challenges to the public that, on the surface, are aviation related. It is seeking proposals on, among other things, ways to apply wireless monitoring to digitized aircraft and to obscure the visibility of airplanes in flight. Successful applicants will have use of the company’s space at the Town Hall for a year.
“In much the same way that Sikorsky does not make the engines or avionics that are installed into our helicopters,” Mr. Van Buiten said, “likewise will some next-generation technology solutions not be produced by us.”
The Stamford Innovation Center is renting most of the old Town Hall from the city. The Connecticut Department of Economic and Community Development provided a half-million-dollar loan to turn the building into modern office space.
In 2008 the city began renovating the Town Hall, with the hope of finding a tenant. It spent $16 million enlarging the space and making it handicapped-accessible. Patty Meagher, a founder of the Innovation Center, remembers the time she and the others involved with the project first considered leasing the building as the work was completed in 2010. “Remember the line from that movie, ‘You had me at hello’? That was the initial reaction,” she said when they first saw the limestone facade, iron-railed staircase, terrazzo floors and brilliant murals on the walls of several rooms.
The location was also an asset, she said, in the shadow of Stamford Town Center mall, steps from the city’s library, theater, shopping and dining districts. There are no restrictions on the kinds of ideas that will be considered for the center, so long as the directors believe there is potential for turning them into successful businesses. A few start-ups are already working in the building on projects as varied as a GPS-enabled community news site and the use of cloned immune cells for medicine.
As fledgling businesses develop, tenants will be introduced to venture capitalists, many of whom live or work in the area, Ms. Meagher said. The investors and entrepreneurs, she said, “will be meeting each other, interacting, and that’s how these companies could very well get funded.”
Business incubators are very of-the-moment across the country. In Chandler, Ariz., the City Council financed a biotechnology-themed center, while a center in Portland, Ore., focuses on sustainability. Nearly three-quarters of these enterprises are sponsored by economic development agencies, governments or academic institutions, according to the National Business Incubation Association. The Stamford Innovation Center is among the 25 percent that are private, with aspirations to become profitable businesses based on rents charged to tenants and educational programs offered to the public.
Over the last five years there have been 150 incubation centers opened nationwide, the association said. While no studies cite the recession as motivating that growth, Linda Knopp, the group’s research and policy director, said she believed the economy played a role. “More communities at least start considering the business incubation concept during economic downturns,” she said, “as they’re looking for ways to stimulate economic growth and create jobs.”
Certainly that is the goal in Stamford, with a population of 122,643, which has an unemployment rate of 7.1 percent, lower than the state and the nation as a whole, but which has lost jobs in the financial and manufacturing sectors and has had an increase in office vacancies. One quarter of the city’s 13 million feet of business space is unoccupied, said Laure Aubuchon, the director of the Stamford Office of Economic Development.
“We are a victim of our own success, because we keep building space,” Ms. Aubuchon said. But she said the upside is that when the entrepreneurs are ready to start their businesses they will be able to find affordable rents in Stamford.
Sikorsky has set a goal of incubating at least two viable companies a year. Barry Schwimmer, a founder of the Innovation Center who is managing the opening, said Sikorsky was setting an example that he hoped other large companies would follow.
“It is a fairly unique model,” he said, adding that such communication between large, established businesses and small, untested ones was “virtually unheard-of.”
What is developed here will most likely have wider applications, Mr. Van Buiten of Sikorsky said. He offered the example of paint that changes color on a military helicopter, which could also be sold to the automobile industry. “We’d be willing to spend a lot of money,” he said of a product like that. “But think of how that would appeal to teenagers if a car company could offer that kind of paint on a Scion at $1,500.”
By Caitlin Mac Neal
A driverless car is tested in Germany. Photo by ODD ANDERSEN/AFP/Getty Images
Yesterday, February 16th, Nevada became the first state to approve regulations that permit self-driving cars. Since the legislation process began last June, Nevada officials worked with insurance companies, car manufacturers, law enforcement and testing professionals to develop rules mainly aimed at safety, according to PC magazine.
The regulations spell out procedures for testing the vehicles now and requirements for use by residents in the future. The robocars in the testing phase will have red license plates. Cars that have been approved for use by Nevada residents will sport green plates. The person in the car is considered the operator (and two people will be in testing-phase cars at all times). TechCrunch notes that as of right now, while people cannot operate the car drunk, they are allowed to text and make phone calls.
In order for a company to test its self-driving car, the company must purchase a bond from Nevada, at the price of somewhere between $1 million and $3 million.
While Nevada is the first state to approve and regulate robocars, Google has already tested its self-driving cars on public roads (see the car in action here). There were always people manning the cars (its first crash was actually the fault of a human), and Google notified local law enforcement in advance of any tests. Audi and Voltswagen are also working on robocars, according to PC magazine.
The main benefits of self-driving cars include reduced fuel consumption as well as less traffic congestion and accidents. Widespread consumer adoption of the technology is still far away—taxi drivers, your jobs are safe for now. But the new regulations could have an immediate effect on the Nevada economy. The state has the worst unemployment rate in the country, having been hit hardest by the recession, according to CNN. As the first state to develop regulations for this emerging technology, Nevada may experience an economic boost as companies flock to the state to test their vehicles.