Create West Virginia

Pre-Conference Thoughts: It's Been a Creative Year!

As we get set to launch the Create WV 2008 Conference today, we asked ourselves "Has there been any impact on West Virginia in the past 12 months? Do we see tangible progress towards building the New Economy?"

We asked in a survey "Is your community actively including key pillars of building creative communities for the new economy in your local growth and development plans?" And here's what you said:

• We're actively infusing new economy thinking into our plans - 33%
• We're just getting started, but we're committed - 38%
• Not sure - 5%
• Not yet - It's not well understood, but we're open to the possibility - 14%
• Not at all - It's not understood or accepted in our area - 10%

That's pretty good momentum. We also asked you to help us build a list of what's going on out there. And boy did we come away feeling excited! Here are just a FEW of the highlights from the last 12 months:

QUALITY OF PLACE

• Community Development Hub launched
• 40% increase in total arts funding in West Virginia
• Create Huntington and the Old Main Corridor Project
• WV Music Hall of Fame launched
• Chuck Mathena Center in Princeton opened
• Gary Bowling's House of Art opened in Bluefied
• Clay Center Community Arts Programs in Mingo, Logan, Kanawha, Lincoln, Clay
• 30th Anniversary of the Morgan Arts Council!
• American Mountain Theater opened in Elkins
• Pocahontas County Artisan Co-Op and Opera House
• Charleston's East End Wi-Fi program launch

DIVERSITY

• Diversity Leadership Academy and Communities United Against Hate forums in Charleston
• One WVU Campaign
• Five Inclusive Communities program members in WV: Morgantown, Parkersburg, Clarksburg, Huntington, Ranson
• "Communities in Schools" in Greenbrier County

TECHNOLOGY and R&D

• Bucks for Brains and Bucks for Jobs program passes
• NETL Tech Support Facility in Morgantown
• CWP Inc - Fossil fuels research partnership with WVU, Carnegie Mellon and Pitt
• Statewide broadband plan revealed
• Robert C. Byrd Science and Tech Center at Marshall
• Marshall Institute for Interdisciplinary Research launched
• MATRIC expansion in South Charleston
• Tech Connect WV reveals Blueprint for Tech-Based Economic Development
• State support for SBIR grants
• Blanchette Rockefeller Neurosciences Institute
• WV Angel Investor Network

EDUCATION AND TALENT

• 21st Century Learning Initiative by WV Dept of Education
• Center for Educational Technology at Wheeling Jesuit
• STEM initiative at Marshall University
• Come Home to WV campaign by WV Dept of Commerce
• Globaloria program - learning via online gaming

We know there are more, so please take the 5-10 minute survey to let us know what is going on in your community! There is nothing better to build momentum in our state than to share the progress that is happening in every county.

MATRIC Continues its Innovative Ways

MATRIC - the Mid-Atlantic Technology, Research and Innovation Center - has already put dozens of ex-chemical industry Ph.D.'s to work in South Charleston. Yesterday the non-profit group, which was launched in 2004, announced a new round of investments and new jobs. From the Charleston Gazette:

The Mid-Atlantic Technology, Research and Innovation Center in South Charleston will add 150 new high-tech jobs in the next 18 months and is receiving $2 million in federal funds to start a Homeland Security data integration center, the center announced on Wednesday.

"While a lot of people are afraid for their jobs, we are creating jobs," MATRIC chief executive officer Keith Pauley said prior to the group's annual celebration on Wednesday.

MATRIC will partner with Butler International Inc. to form the International Design Center, which will create 150 new engineering and research and development jobs. Butler is a tech outsourcing company headquartered in Florida.

This is what it's all about - leveraging innovation to create jobs, not just wait for them to come.

WVU is also on the move with the opening of the Blanchette Rockefeller Neurosciences Institute. You can also hear - if you listen closely - the phrase "new economy" cross the lips of various politicians running for election or re-election this season.

As hundreds of folks head to Snowshoe Mountain next week (including Keith Pauley, CEO of MATRIC and a featured speaker), we can celebrate the progress our state is making across many pillars for "building creative communities for the new economy."

See Ideas Come Alive at Seed Matchmaking Event

Please take note of an exciting event being held in conjunction with the Create WV Conference on Showshoe Mountain. The WV Angel Investor Network, Concord University's Rahall Technology Center, and the Federal Reserve Bank of Richmond are holding the Seed Capital Matchmaking event Wednesday 10/22 afternoon from 1:30pm - 5:00pm immediately following the closing session of Create WV.

The event is generously sponsored by WVU's Entrepreneurship Center.

Whether you have a business idea and would like to see how the investment process evolves, you're interested in sparking entrepreneurship in your community, or just love bold ideas, consider attending! You DO NOT have to be a registered attendee at Create WV, you can attend this event standalone for free.

Here is the agenda:

• 1:45PM   Entrepreneur Business Plan Showcase - Entrepreneurs will display graphic synopses of their business concepts and be available to answer questions about them
• 2:45 PM  Opening Remarks - Courtney Mailey, Federal Reserve Bank of Richmond
• 2:50 PM  Investor Roundtable Discussion - Moderated by Ron Basini, Concord University - Panel of investors will discuss how investors go about making decisions to invest in new companies.
• 3:30 PM  Break
• 3:45 PM Business Plan Presentations - Three companies will be given 10 minutes to present and 10 minutes to take questions from actual investors (yes, it's sort of like a realty TV show - you get to watch the process!)
• 4:45 PM Open Discussion

If you're interested in attending, there is no need to RSVP. Just make your way to Snowshoe Mountain on Wednesday 10/22 or attend the Create WV conference. We promise it will be worth the drive!

 

Free Money - Just Add Business Plan

A reminder that three exciting workshops for business and "social" entrepreneurs are being held this week by the Federal Reserve Bank of Richmond and the WV Angel Investor Network. The primary goal of this seminar is to develop a compelling story about your business idea that will appeal to investors. Please bring a copy of your business plan with you and any other materials that you are using to develop your plan.  Refreshments will be provided.

It's not too late to make plans to stop by any of these three sessions:

• Tue, Sept 9, 3pm - 5pm  - Concord University, Rahall Tech Center, Athens, WV
• Wed, Sept 10, 10:30am - 1:00pm - West Virginia High Tech Consortium, Fairmont, WV
• Thur, Sept 11, 10am - 12:30pm - University of Charleston Frankenberger Gallery, Charleston, WV

Please pre-register by sending an email to Courtney Mailey at [email protected].

Participants in these workshops are invited to meet with actual investors at the Seed Matchmaking Event at the Create WV conference on October 22 at Snowshoe Mountain Resort.

If you of any budding entrepreneur, either business or social/non-profit, please make sure they know about this event!

Resources for Creative Projects

Mary Hunt-Lieving of the Benedum Foundation wanted to share the following opportunities for organizations seeking financial support for their creative inititiaves. Thank you Mary!

Seed Money for Innovative Projects

Sparkplug Foundation
The Sparkplug Foundation primarily supports nonprofit organizations that are proposing start-up projects in the fields of music, education, and grassroots organizing. In the Music category, the Foundation supports emerging professional musicians or music-development programs. In Education and Teaching, the Foundation funds projects that deal with "the whole student" and with learning as a community activity. Through Grassroots Organizing, the Foundation encourages activist strategies for addressing institutional injustices and for building a reasoned, just society. In addition to these three categories, the Foundation is currently interested in supporting communities working on sustainable energy and

Gulf

Coast

reconstruction democracy. The Foundation also provides limited support for projects in

Israel

that involve Palestinian communities. The next application deadline is

October 31, 2008

. The Foundation does not accept unsolicited applications. A telephone conversation to determine eligibility must be scheduled in order to initiate the application process. Prospective applicants are strongly urged to read the Foundation's website listed above carefully before requesting a telephone interview.

Support for Progressive Artists

Puffin Foundation
The Puffin Foundation seeks to open the doors of artistic expression by providing grants to art organizations and artists who are often excluded from mainstream opportunities due to their race, gender, or social philosophy. The Foundation makes grants averaging $1,000 to $2,500 to encourage emerging artists in the fields of fine arts, film and video, music, photography, theater, and public interest. The Foundation is particularly interested in supporting creative and innovative initiatives that will advance progressive social change. Proposals for 2009 grants will be accepted from September 1 until

December 30, 2008

. Visit the website listed above for application instructions.

Got Funding?

Do you have a great idea or project that needs financial support? A new business? A public-private partnership that needs some investment?

The Federal Reserve Bank of Richmond, in partnership with Create WV, is holding an exciting "seed capital matchmaking" event at the 2nd Annual Create WV Conference at Snowshoe Mountain Resort on Wednesday, October 22, 2008. The purpose of the event is to introduce business, social, and community entrepreneurs who have solid business plans with potential funders from banks, private investors and other sources.

"Our goal is to help cultivate early stage projects that benefit communities," said Courtney Mailey, Regional Community Development Manager for the Federal Reserve Bank of Richmond, whose responsibility covers most of West Virginia. "We want to connect people with well-developed ideas and projects with the funding sources to help bring these projects to reality." The event will run from 1 p.m. - 4 p.m on Wednesday, October 22, immediately following the Create WV Conference.

Entrepreneurs will gain experience by spending 10-15 minutes with potential funding partners to pitch their investment opportunity. Seed capital investors will benefit from the opportunity to see a number of high-potential business plans in a single event.

In preparation for the October 22 event, which is a "post-conference" component of the Create WV 2008 Conference (www.createwv.com) running October 20-22, the Federal Reserve will be holding three regional business planning presentation seminars in Athens, Fairmont, and Charleston on September 9, 10, and 11, respectively. The purpose is to ensure a strong pipeline of entrepreneurs with business plans ready for the matchmaking event.

"It's important to note that communities are eligible for this event, not just individual business entrepreneurs," said Jeff James, Chairperson of Create WV. "The Federal Reserve has been a key partner in West Virginia to help stimulate creative, bold projects to help communities embrace the new economy. This resource matchmaking event is a fantastic opportunity for local leaders to identify and fill gaps in funding to move forward."

Register for the business planning presentations by contacting Courtney Mailey at [email protected] or call 804-697-8778 today!

To register for the Seed Capital Matchmaking event, simply register for the Create WV Conference at www.createwvevents.com!

Should State Governments Invest in Start-Ups?

How do small states or states not traditionally strong in vibrant high-tech industry sectors catch up? In some cases, they focus the resources of the state to provide an investment spark. Is this a good idea?

West Virginia entered into an experiment in venture capital investment a few years ago by divvying up $25 million into seven VC funds, including one public entity, the Jobs Investment Trust, or JIT. Some investments seem promising (see the individual fund web sites to view their portfolio of investments), but some believe the number of new high-growth start-ups fueled by this effort is underwhelming. In some cases, investments went to out-of-state companies because not enough high-potential start-up firms could be identified in the state. So a new effort (not funded by the state) to develop "angel", or early stage, investment from the private sector has begun.

Wisconsin has taken a middle approach. Rather that strictly leave the development of an angel investment network up to a relatively risk-averse, conservative private sector, they have aggressively developed the Wisconsin Angel Network, or WAN. Within two years of its launch, angel investing in the state more than doubled from $67 million to $146 million in 2007. The number of organized angel networks in Wisconsin tripped from six in 2005 to 18 in 2007.

But Wisconsin is serving more as the organizer and trainer of networks, not an investor. Instead, they target wealth individuals and help them become more comfortable with the concept of riskier early-stage investing. Other states such as North Dakota (which recently shot up from 44th to 31st in new economy state rankings in just four years), Georgia and Oklahoma have similar programs.

Wisconsin's program is one of the most successful. The state has added a 25% tax break so investors can write off their investments on state income tax.

Oklahoma has gone a step further and started a $7 million seed fund, but will only invest if other private sector investors are secured first. The practice of using taxpayer money for risky early stage efforts remains controversial, even with such caveats.

What role would you like to see West Virginia state government take in this arena? What is the proper balance between acting as a spark for much-needed high-growth startups (and hopefully stirring private sector investors to join in) and potentially losing taxpayer dollars on risky investments?

Growing From Within

Many folks have highlighted West Virginia's historic reliance on two forces for "economic development": 1) outside companies willing to locate facilities here, and 2) state government. Seeking the first leads to an intense focus on comparing our relative competitiveness on tax structure and incentives, seeking the second leads to an intense focus on central planning and tax-payer fueled investments (and the inherent political nature of those investments).

Both approaches have a heavy reliance on government to lead the way. Much pressure is put on state and local development organizations to recruit newsworthy wins, such as the hugely successful Toyota plan in Putnam County and the Hino Motors facility in Wood County (also looking like a good win for our state). In fact, West Virginia has won awards for its centralized development and business recruiting efforts. Why then are we still at the bottom of the heap in economic growth and income?

  What can often get lost with the centralized approach is the lack of a vibrant, entrepreneurial small business sector. And after all, this is where the majority of new jobs are created and where future big companies get their start. We should be very concerned that West Virginia has the lowest rate of entrepeneurship in the nation, and that we only had seven companies on the Inc. 5000 list of fastest-growing small companies (that's 0.14%, far below the 0.6% WV represents of the U.S. population). 

Some point to an historic reliance on the government and outside corporations for jobs for our predicament in the entrepeneurial realm. How can we balance our economic future with a more vibrant private-sector, entrepreneurial community of risk-tolerant investors, inventors and innovators?

We're attempting many of the right things, according to agreed upon best practices. Some organizations like the YES Network and the Entrepreneurship Alliance are focusing on matching much-needed mentors with budding entrepreneurs. Some are focusing on reaching young people with business plan contests and education. Some are focusing on intensive training programs. Others on the commercialization of technical research from our universities.

What else will it take? Time, perhaps. More investors, for sure, especially those with a higher risk tolerance and a willingness to invest in industries they may not be familiar with (much of our local wealth is from the energy sector; how can we help these investors feel comfortable evaluating and investing in an Internet startup?).

The Next Microsoft...in West Virginia?

Sounds far-fetched, doesn't it? But more and more, high-tech entrepreneurs are setting up their companies based on lifestyle choices vs. clustering around the expensive Silicon Valley area. Dozens of companies have started in or migrated to places like Boise, Idaho, where the costs are low, the air is clean, and the outdoor amenities are many.

Heck, even Bill Gates chose to set up shop in his hometown of Seattle primarily because he wanted to live near his parents. It's hard to imagine, but Seattle was not the high-tech, internationally known city it is today back in the mid-70's when Microsoft got started. It had high unemployment and was primarily known for its shipping and aircraft (Boeing) industries, which had fallen on hard times.

Today, companies like RightNow are popping up in towns like Bozeman, Montana. Started by Greg Gianforte, who:

... moved to Bozeman in 1995 because he'd fallen in love with Montana on a junior-high-school backpacking trip, and because he thought it would be a good place to raise his kids. In Montana, Gianforte can camp in the summer, hunt in the fall, and ski in the winter. Mountain-ringed Bozeman, population 27,500, home of Montana State University, was half college town, half cow town, a place that offered gorgeous scenery, an active outdoor lifestyle, and not much in the way of employment. Gianforte decided that his personal mission was to create 2,000 high-paying high-tech jobs in town. He had the talent for starting companies, he figured, so why not put it to use? First, he launched an incubator and started mentoring local entrepreneurs. He then started a venture of his own, an E-mail stock-quote service. But he got impatient. The companies that he was involved with were just too small. He began looking around for a new business to start.

This is what we mean by "they will come and build it" vs. "build it and they will come." West Virginia, particularly Morgantown, Fairmont, Wheeling and Huntington, has the same potential to attract entrepreneurs based on lifestyle choices and to provide young talent with local colleges and universities. Yes, we have some tax issue to fix, but notice nothing in the Inc. Magazine article about Greg mentioned him choosing Montana based on tax incentives or structure.

West Virginia's primary "attractor" for entrepreneurs like Greg is our quality of place and overall low cost of living and doing business. We have to market West Virginia aggressively as "your state to create."