Developing Entrepreneurship & Technology Parks for ......Innovation Zone (KOIZ) and Keystone Innovation Zone (KIZ) IP Strategic Plan – Where We ’ve Been • 1999 – John F. Street

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Developing Entrepreneurship & Technology Parks for Industrial

DevelopmentPresented to

UN Division for Sustainable Development

Presented by

Richard A. Bendis

President & CEO

Innovation Philadelphia

May 12, 2006

“Innovation is fostered by information gathered from new connections; from insights gained by journeys into other disciplines or places it arises from ongoing circles of exchange, where information is not just accumulated or stored, but created.”

- Meg Wheatly

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A 21st Century World

vDistributed IntelligencevComplex TechnologiesvDiverse WorkforcevCreative TransformationvContinuous InnovationvGlobal EconomyvInfrastructure RenewalvSustainable DevelopmentvCareer-Long Learning vFinite Resources

Source: Statewide Conference on Science, Technology, and the Future

Factors of Worldwide Competitiveness

• Domestic Economic Strength -Macroeconomic understanding and evaluation of the domestic economy

• Government - Extent to which government policies are conducive to competitiveness

• Globalization - Extent to which the country participates in international trade and investment flows

• Finance - Performance of capital markets and quality of financial services

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Source: Statewide Conference on Science, Technology, and the Future

• Infrastructure – Extent to which resources and systems are adequate to serve the basic needs of business

• Science and Technology – Scientific and technological capacity, together with the success of basic and applied research

• Management – Extent to which enterprises are managed in an innovative, profitable, and responsible manner

• People – Availability and qualifications of human capital

Factors of Worldwide Competitiveness

Human Connectivity

Source: Fast Growth

Communications networks have the ability to transform economic, political, and social relationships on a global scale.

• In the past, organizations strategized to gain competitive advantage.

• The emphasis in the future will be to gain cooperative advantage.

• A core competency needed in individuals and organizations alike is connectivity.

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INNOVATIONGLOBAL

COMPETITIVENESS

KNOWLEDGE

“If a man empties his purse into his head, no man can take it away from him. An investment in knowledge always pays the best interest.”

--Ben Franklin

Science – The Fuel for Technology’s Engine

• Creates Jobs

• Builds New Industries

• Improves our Standard of Living

Technology

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Role of Industry: Wealth Creation

Capitalism is a Process of Creative Transformation

“The interaction of technological innovation with the competitive marketplace is the fundamental driving force in capitalist industrial progress.”

Joseph A. Schumpetter, 1942

EducationResearch

KnowledgeIntegration

ResourceInvestment

KnowledgeCreation

Knowledge Transfer

ContinuousLearning andInnovation

Role of Academia

Building Capacity For Learning and Innovation

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Educate students to:

• See the world whole; sense the coupling among seemingly disparate fields of endeavor.

• Perform synthesis in balance with analysis.

• Build connections between the world of learning and the world beyond.

• INNOVATE!

Challenges for 21st Century Academia

“Science, engineering, and technology are fundamental drivers in the economy of the future, providing the foundation for business growth and overall improvement in the quality of life.”

- Mark Birrell

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• A healthy, educated public

• Job creation, economic health and security

• World leadership in science, engineering, mathematics and technology

• Improved environmental quality and sustainable development

• Harnessed information technology

• Enhanced national security

Role of Government: Physical and Intellectual Infrastructure

© KTEC 1998

Government’s Role in Science and Technology

• Long term vision and planning• Identify gaps and trends in science and

technology environment• Be a catalyst through strategic investments

and partnering• Encourage a balanced and flexible research

and development portfolio• Encourage private sector innovation• Establish performance-based research and

development

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Principles of Successful Partnership

• Shared Ownership• Broad Participation/Diversity of Interests• Champions/Advocates• Operational Principles• Partnership Formalization• Merit-Based Decisions• Flexibility• Cost-Sharing• Evaluation• Stability/Long-Term Commitment

MISC 01289959

Pennsylvania Facts

•6th Largest State in the United States

•12,281,054 Residents

•Land Area 44,817 square miles

•Public Colleges and Universities – 146

•Full-time College Students –589,838

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Where is the Greater Philadelphia Region

3 states11 counties

• Pennsylvania: Bucks, Montgomery,

Philadelphia, Chester, Delaware

• New Jersey: Mercer, Burlington, Camden, Gloucester, Salem

• Delaware: New Castle

The Greater Philadelphia Region is the “Buckle on the Money Belt”

The Greater Philadelphia Region is “The Buckle on the Money Belt”

Almost half-way between Washington, DC –the public financing capital of the U.S. – and New York City – the private financing capital of the U.S. – Philadelphia is the perfect place to locate.

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• 6th Largest metropolitan area in the U.S. – 6.2M CMA (PA, NJ, DE)

• 5th Largest City in the U.S. – Population 1.4M

• 6th Largest GMP in U.S. – $182.4M

• The Greater Philadelphia Region has the largest per capita concentration of higher education institutions – 85+ colleges

• 80% of the world’s major pharmaceutical companiesare within a 2 hour drive of Philadelphia – Merck, GSP, BSM, J&J, AstraZeneca, Dupont

• Over 450 foreign-owned companies and subsidiaries employing over 60,000 in the Region

• Greater Philadelphia Region contains 34 foreign consuls, participates in International business promoting cultural exchange with 7 sister cities.

Greater PhiladelphiaRegion Facts

Greater Philadelphia

“1ST” Facts

• Computer was built in Philadelphia- 1946

• Piano in America was built under the name “Piano Forte” (1775)

• American hospital, Pennsylvania Hospital- (1771)

• Children’s Hospital (CHOP) (1855)

• Independent medical research facility in the U.S., Wistar Institute- (1892)

• Medical school and teaching hospital, University of Penn (1874)

• Cancer Hospital, Fox Chase Cancer Center- (1904)

• College of Pharmacy, University of the Sciences- (1921)

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PA Port and Trade Facts†

Foreign Exports - $24 Billion

Leading International Market – Canada

Leading Export Cluster – Chemicals

Philadelphia: Gateway to the Americas

* Sources: CIA World Factbook, World Bank, Government of the R epublic of Ghana

Why Philadelphia?Educated Workforce

The Greater Philadelphia Region has the largest per capita concentration of higher education institutions – 83+ colleges & universities and over 250,000 students. Our world renowned institutions include:

• The University of Pennsylvania• Rutgers University• The University of Delaware• Drexel University• Temple University

The Knowledge Industry Partnership, dedicated to attracting, engaging, and retaining students, gives the Region a key advantage in keeping an educated workforce.

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Greater Philadelphia RegionTarget Clusters

Pharmaceuticals

Bioscience/Biotechnology

Information Technology/Systems Integration

Financial/Business Services

Petrochemicals

Nanotechnology

Creative Economy

Why Philadelphia? Financial Resources

The Greater Philadelphia Private Equity Community

Total Number of Private Equity/V.C.Firms 63

Total Assets Under Management $29.7B

Total Investments by U.S. based Firms in 2003 $18.2B/2,715 co’s

Total investments in the Region in 2003 $555M/77 co’s

Number of U.S. 1st time funds in the Region 5 (38 nationwide)

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Why Philadelphia?Diverse Cultural Assets

• Annenberg Center

• Choral Arts Society of Philadelphia

• Forrest Theatre

• Kimmel Center for the Performing Arts

• Mummers Parade

• Opera Company of Philadelphia

• Pennsylvania Ballet

• Philadelphia Chamber Music Society

• Philadelphia Film Festival

• Philadelphia Folk Festival

• Philadelphia Festival of World Cinema

• Philadelphia Fringe Festival

• Philadelphia Orchestra

• Philadelphia Shakespeare Festival

• Philadelphia Theater Company

• Philly At Night

• Rennie Harris Pure Movement Dance Company

• Theatre Alliance of Philadelphia

• Tweeter Center

• Wilma Theater

Premises and Infrastructure

• Internationally recognized academic research:– Four medical schools, more than any other urban area

– Six NCI-designated cancer centers

– 20 teaching hospitals

– 2 pharmacy schools

– University of Pennsylvania — #3 nationally in NIH funding

– Science Center – 1.9 M sq. ft.

• International airport for easy access to European markets

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Philadelphia International Airport

• Located appx. 7 miles from downtown Philadelphia

• 7 terminals and 4 runways• Serves more than 100 domestic and international locations.

• A private, not-for-profit Pennsylvania corporation, founded in 1958 by the City of Philadelphia and the Greater Philadelphia Chamber of Commerce.

• Mission is to promote economic development throughout the City.

• Implements economic development by leveraging financing and real estate resources to retain and to grow employment in Philadelphia.

• Manages the planning, development, and operation of The Navy Yard.

Philadelphia Industrial Development Corporation (PIDC)

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The Navy Yard

Benefits from a unique and valuable set of architectural, landscape, and infrastructure assets. Key assets include:

• Suburban-scale, waterfront property located minutes from downtown Philadelphia• Convenient airport, Amtrak, highway, and public transit access• R&D, manufacturing, and corporate office facilities in new and historic buildings• Unique capacity for growth located within the urban core • Proximity to world-class industry, labor, logistics networks as well as federal and

academic R&D facilities • Competitive pricing and tax advantages, including Keystone Opportunity

Innovation Zone (KOIZ) and Keystone Innovation Zone (KIZ)

IP Strategic Plan –Where We’ve Been

• 1999 – John F. Street Elected Mayor of Philadelphia• 1999-2000 – Mayoral Transition Team Explores Ways to

Make Philadelphia More Competitive• 2000-2001 – New Economy Development Alliance (NEDA)

Steering Committee Created (Univ. of Penn, Dr. Judith Rodin; Comcast Corporation, Brian Roberts; GlaxoSmithKline, Dr. Jean-Pierre Garnier)

• 2001 – Innovation Philadelphia Created Under the Leadership of Dr. Rodin

• $2.5 Million in Seed Capital from the City of Philadelphia• Rich Bendis recruited to the City of Philadelphia, 12/01

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A Public/Private Partnership created to

Grow the Wealth and

Workforce of the Greater Philadelphia

Global Innovation Economy

Innovation Philadelphia’s Mission

Methodology• Blank sheet of paper

• Gap analysis of all Regional-based economic development and investment programs

• SWOT analysis of all organizational programs, boards, and funding

How IP Started

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Innovation Philadelphia’sOrganization

IP Board of Directors

Mel Baiada –Founder & Chairman, SengenRichard A. Bendis – President & CEO, Innovation PhiladelphiaErnest Dianastasis – Managing Director, CAILucinda Duncalfe Holt – Former CEO, TurnTide, Inc.Brenda D. Gavin – Managing Partner, Quaker BioVenturesStephen Goodman – Partner, Morgan Lewis & Bockius LLPJohanna Hambrose – President & COO, Electronic InkWilliam P. Hankowsky – President & CEO, Liberty Property TrustDavid R. King –CEO, Biorexis Pharmaceutical Corp.Hugh Long – State CEO, Pennsylvania/Delaware, Wachovia BankRalph Muller – CEO, University of Pennsylvania Health SystemConstantine Papadakis – President, Drexel UniversitySamuel J. Patterson – President & CEO, Veridyne, Inc.Glenn Rieger – General Partner, NewSpring Capital

Rebecca Bagley, Ex Offico – Deputy Secretary – Office of Tech. Investment, PA Dept. Comm. & Econ. Dev. Stephanie Naidoff – Ex Officio, City Representative and Commerce Director, City of PhiladelphiaJohn Street, Ex Offico – Mayor, City of Philadelphia

* Joshua Kopelman – Trustee, Kopelman Family Foundation, Emeritus as of January 2006

Robert M. McCord, Interim Chair - Chairman, Eastern Technology Council; Managing Director, PA Early StageDr. Judith Rodin, Former Chair - President, Rockefeller Foundation

Dr. Jean -Pierre Garnier, Vice Chair – CEO, GlaxoSmithKline

Brian Roberts, Vice Chair Emeritus -Comcast

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• Attracting • Growing• Retaining• Connecting

Method of Achieving Mission

Technology-based Businesses

Innovation Philadelphia’s Goals

• Increase the investment in knowledge-based companies

• Increase the Knowledge Economy workforce• Foster and Leverage Regional Cooperation to

Accelerate Technology Commercialization and Wealth Creation

• Brand and market the Greater Philadelphia Region

• Promote sustainable economic development

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What Makes IP Different?

• Most TBED organizations plan, Innovation Philadelphia implements!

• Four years ago, IP was a clean sheet of paper and today we are a comprehensive innovation/technology based economic development organization.

• IP occasionally serves as an incubator for innovative programs and at other times takes ownership and manages necessary programs.

Economic Development

• Economic Development is like a three-legged stool:– Attraction– Retention– Grow Your Own

(Innovation Philadelphia’s focus)

• TBED requires patience and persistence, continuity and consistency.

• Working with early-stage companies takes time.

Attraction –PIDC/City Commerce

Grow Your

Own - IP

Retention –City

Commerce PIDC

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Investment Commercialization

Global & Regional Economic

DevelopmentResearch & Marketing

IP Core Products / Services Today

World’s Best Technology Network

Commercialization Model

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Entrepreneurial Investments

Entrepreneurs are the foundation for economic growth. Our investment programs support entrepreneurs in the earliest stage of development as they begin to move their ideas from concept to reality.

Economic Stimulus Fund Requirements

• IP makes direct equity investments in technology-based entrepreneurial companies through ESF.

• ESF is used as a catalyst to stimulate co-investmentwith other strategic partners and funding sources to leverage its economic stimulus investments.

• ESF investments may take the form of a loan, convertible debenture, straight equity, or other combination of debt and equity, and will rarely take the form of a grant that has no repayment provisions.

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ESF Accomplishments

IP has invested $860,000 in ESF. ESF companies have raised total capital of $60 million (70:1 leverage per $

invested). ESF companies have a total enterprise value of approximately $107 million

(124:1 leverage per $ invested).123 knowledge jobs created/retained by ESF.

Why SBIR & Federal R&D Programs?

• More than $2.0 Billion available of SBIR funds and more than $50 Billion in other federal R&D programs!

• Not a loan – no repayment• Provides recognition, verification & visibility• Potential leveraging tool to attract VC/other sources of $$$• Fosters partnerships (e.g., large corporations, academia)• Small business concerns are recognized as a unique

national resource of technological innovation• Intellectual property rights are normally retained by the

small business• Provides money to fund high risk projects• Creates jobs and generates tax revenues

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Research Dollars Requirements

• Research $ connects entrepreneurs to federal grant money, providing financial grants and technical assistance, as well as research support to early-stage technology companies.

• Federal grant programs such as Small Business Innovation Research (SBIR), Small Business Technology Transfer (STTR) and Advanced Technology Program (ATP) are the focus of this web-based program.

• IP’s Research $ companies are twice as successful as the national average.

Department of Energy

SBIR Phase II

$750,000

National Institutes of Health SBIR Fast Track

$1,000,000

National Institutes of Health SBIR Phase II

$1,070,000

Department of Defense

$235,000

National Institutes of Health SBIR Fast Track

$4,000,000

National Science Foundation

SBIR Phase I

$98,000

Proteus OpticsDepartment of

Defense

SBIR Phase I

$100,000

Transposagen, Inc.

National Institutes of Health

SBIR Phase I

$100,000

National Institute of Standards & Technology

$2,000,000

Research Dollars Fund Accomplishments

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Innovation Partnership

• Consortium of leading Pennsylvania economic development organizations, universities, and PA Department of Community and Economic Development.

• Goal – to assist Pennsylvania technology companies (biotechnology, nanotechnology, advanced manufacturing, and communications) in gaining a greater share of federal grant dollars available each year.

• IP is the Statewide fiscal intermediary and a partner, the Research Dollars Fund was the model for the Partnership.

Innovation Partnership

• Opportunity to tap into more than $2B available SBIR/STTR funds and over $50B in other federal R&D programs annually.

• Outreach/education• Proposal Preparation Reviews• Microgrants

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Innovation Partnership –The Partners

Founding Partner Organizations

Associate Partner Organizations

Innovation Partnership Accomplishments

• IPART has assisted more than 197 portfolio companies to win more than $1.9 million in federal research and development grants.

• IPART has provided 91 micro-grants valued at more than $350,000 to Pennsylvania companies.

• IPART leverage is 4:1.• The IPART award to proposal ratio is 21%. • Outreach and marketing to more than 1,000 small

businesses and university representatives.

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Source: Jeffrey E. Sohl, Center for Venture Research, 2002

Supply

Stage

Source

Demand

Pre-Seed Seed/Start-Up Early Later

Founders

FFF Angel/Angel AlliancesVenture Funds

$25K $100K $2, 000K $5, 000K

Funding Gap

Secondary Funding Gap

Equity Capital for Entrepreneurs

The Funding GAP

State of Seed& Start-up Investing

Despite stronger long-term results, early-stage funding has been dramatically decreasing as a percentage of VC

funding as investors move “up market”

Source: PWC MoneyTree Survey, 2004

19%

13%

2% 2% 1.7%

6%

2%3%

9%9%

0%2%4%6%8%

10%12%14%16%18%20%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

(See

d/St

artu

p Fu

ndin

g %

of V

C)

% of Total VC

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State of Seed/Startup Investing

Source: PWC MoneyTree Survey, 2005.

2,939$217 million2005

2,966$216 million2004

2,865$196 million2003

3,057$217 million2002

4,456$305 million2001

DealsDollars

Angel Investors

Angel Investors

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Angel investors provide about 90% of the seed and early-stage outside equity capital for start-up entrepreneurs.

Angel Investors

The Increasing Importance of Angels

Source: University of New Hampshire, Whittmore School of Business, Center for Venture Research

• 225,000 angels invested $22.5 billion in 48,000 ventures in 2004, up from $18.1billion in 42,000 ventures in 2003.• VCs invested $20.9 billion in 2004 and $18.9 billion in 2003.

• 100+ Angel Groups formed nationwide in last 3 years

• In many cases, Angel Groups are becoming alternatives to early-stage VCs

• However, the average investment per angel group is still below the funding gaps as evidenced by ACA statistics (and simple mathematics on above statistics)

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Angel Fund Competitive Advantages

•Competitive advantages

To get best returns:

• Only do deals where expert is leading deal• Higher quality due diligence• More eyes on deal• Diversification• Vote process selects only the best deals

• Performance – a bit better:

Why:

•Increased chance of an expert at the table• More people available to share due diligence• More eyes on deal

• Typically poor returns

Why:

• Lack of expertise•Generally weak due diligence• Less eyes on deal• Inadequate diversification

Angel FundsAngel GroupsIndividual Angels

Angel Group Expansion

As VCs move up market, the number of Angel Groups is growing to fill the early-stage funding gap.

0

5 0

1 0 0

1 5 0

2 0 0

2 5 0

1 9 9 6 1 9 9 8 2 0 0 0 2 0 0 2 2 0 0 4

Growth of Angel Organizations

Source: Center for Venture Research

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Examples of Other Angel Funds

• Tri-State Investment Group (Research Triangle)– Four funds totaling more than $20 million under management– Successful Investments

• Celotek - Sold to Cylink (Nasdq:CYLK) - Returned 2x• Ganymede Software Inc. - Sold to by NetIQ - Returned 7x-10x• Accipiter - Acquired by CMGI and Merged into Engage Technologies –

Returned 40x –60x

• The Washington Dinner Club (D.C.)– Three funds totaling $23 million under management– Each fund has a theme

• Bi-State Investment Group (Kansas City)– $2.8 million fully invested

• Springboard Capital LLC (Jacksonville, FL)– 100 members, initial close at $2.25 million in ’02– $4 million invested currently in 7 deals

• Ohio TechAngels Fund (Columbus)– 50 members, $1.3 million fund size

Angel Capital Association Member Locations

Full Member

Provisional Member

May 2005

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Mid-Atlantic Angel Group

• MAG is a member-managed private equity investment fund that bridges the gap between seed investments and institutional venture capital created and administered by IP Management.

• MAG leverages public and private funding resources and networks by providing equity capital to seed and early-stage, technology-based, high-growth companies.

• Investors include Pennsylvania BFTDA, NJEDA, Delaware Innovation Fund, Robin Hood Ventures (18 Members), LORE 6 Members) and Individuals (21 Members).

• The fund plans to invest in 2-4 companies per year and 10-12 companies in all. Average investments will be $200,000 or more in rounds ranging f rom $500,000 to $4 million.

• MAG made its first investment in Protez Pharmaceuticals in July 2005

• MAG announced its third close of more than $4.4 million with 89 investors on January 13, 2006.

Pennsylvania Angel Network

• The Pennsylvania Angel Network (PAN) is a statewide organization designed to offer support to over two thousand angels in the state of Pennsylvania.

• By increasing individuals' knowledge base through information sharing, PAN provides an opportunity to assist angels in making connections with companies and to make the most of those connections.

• Helps its members to capture the benefits of fostering entrepreneurship at its early stages.

• PAN's members will enable individual businesses to grow at a steady rate.

• PAN creates the opportunity for its members to share in the considerable wealth of resources in our local economy.

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Pennsylvania Angel Network

• Loans to venture capital fund managers to invest in young PA research and development companies.

• A $60 million fund designed to provide loans to Pennsylvania-focused venture capital companies looking to make investments in companies located in the Commonwealth.

• It will allocate 50% of the funds available to venture capital partnerships which are headquartered in historically underserved areas of Pennsylvania. These areas are defined as counties outside of the Philadelphia MSA and those with populations below 1 million. (Will also insure that 50% of the funds are invested in these areas.)

• Requires a dollar-for-dollar match which will then create $120 million of investment capital available for Pennsylvania companies.

New PA Venture Capital Investment Program

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Keystone Innovation Zones

• KIZs are designated zones that may be established in communities that host

• institutions of higher education – colleges, universities, junior colleges, and

• technical schools.

• Offers special funding incentives.

• KIZs support technology innovation through:

• Tech transfer

• Leveraging research and development at universities

• Commercializing technologies and new products from R&D

Federal Tax Credit for Angel Investors

• Rep. Donald Manzullo (R-IL16), Chairman of the US House Committee on Small Business, plans to create a federal income tax credit for angel investors.

• The proposed legislation is an effort to help fill the gap for early-stage capital formation for small companies.

• More than twenty states currently offer a variety of income tax credits to encourage such private investment in worthy early stage businesses.

• The legislation is still in the draft stage.

• The amount of the credit per investment is yet to be determined.

• Investments qualified for the tax credits will be limited to accredited investors in qualified small businesses.

• Some yet-to-be-defined caps both per investor and per company are also being considered for the legislation.

• Legislation will avoid creation of a new bureaucracy for adminis tration; and so the tax credits will be self-executing for those who claim them.

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Once ideas become reality, the next step is creating revenue. This is the process of commercialization – moving a technology or innovative concept from the idea stage to the marketplace.

Commercialization

A Strategy for Intellectual Property Donation

• Innovation Philadelphia (IP) and Phoenix IP Ventures received $750,000 from the BFTDA for their joint intellectual property donation initiative.

• The new program will enhance the rate and magnitude of science driven economic development in the Commonwealth of Pennsylvania and the Greater Philadelphia Region

• Under this model, IP and Phoenix IPV have established a not-for-profit entity, which will accept intellectual property backed assets from “Fortune 500 companies” as donations.

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• In return for these donations, the donating companies have the opportunity to receive tax credits for their philanthropicefforts.

• Donated assets will be commercialized subsequently by IP and by Phoenix IPV primarily through investments in existing companies or the creation of new companies.

• The overall goal is to access worldwide science to increasethe overall economic growth in the Commonwealth and the Region.

A Strategy for Intellectual Property Donation

Technology Transfer

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Up to $13MUp to $750KIPART & IP SBIR Program

Up to $1MUp to $250KMAG

$500K-1MUp to $100KIP (ESF)

$3MUp to $500KScience Center

$5MUp to $1MBioAdvance

$3MUp to $750KBen Franklin

Total Annual Deal Funding Available

Cumulative Funding Per DealCumulative Funding Per Deal

World’s Best Technology Network

• Regional Branding & Marketing

• Common Investment Review Process

• Shared Due Diligence

• Established in 1982 to stimulate economic growth through innovation,

entrepreneurship, and the development and adoption of new

technologies.

• BFTP operates on a Regional level through four centers strategically located

throughout PA , with offices in Pittsburgh, State College, Bethlehem, and

Philadelphia.

• Every dollar invested in BFTP yielded nearly $23 of additional income in the

state.

• BFTP generated 93,105 job-years at a cost to PA of $3,342 per job-year*.

• The state garnered more than $400 million in additional tax revenue as

a direct result of the program, which more than covered the operating

costs of the program over the same period.

• BFTP boosted Pennsylvania’s economy by $8 billion.

• Web site – www.benfranklin.org

Ben Franklin Technology Partners

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BioAdvance

• Founded as part of the $2 Billion plus initiative by PA to strengthen the commitment to life sciences

• Three Greenhouses established throughout the Commonwealth by Governor Rendell – BioAdvance, the Life Science Greenhouse of Central Pennsylvania, and Pittsburgh Life Sciences Greenhouse

• BioAdvance received $33.8 million from the State’s share of tobacco settlement monies to spur the creation of life sciences jobs and businesses

• Creation of statewide Clinical Trials Network• The Greater Philadelphia Region has 2nd largest concentration of

biopharmaceutical jobs in North America and earned $2.8 billion in NIH funding from 1996 to 2000

• Web site – www.bioadvance.com

• Mission: To be the world’s best science and technology commercialization engine.• The Science Center is home to more than 150 companies whose work spans the

business cycle from applied research and development through commercialization and maturity.

• The Science Center counts 30 academic institutions as shareholders.• Covers more than 17 acres in University City. • In an expansion that will double its capacity, the Science Center will build

an additional 1.8 million square feet in a comprehensive plan to providescientific laboratories, residential housing, a hotel and conference center,retail space and parking on Market Street in the University City section ofPhiladelphia.

• The building program is part of the Center's strategic two-fold effort to provide companies with the full range of facilities and services they need to accelerate commercialization.

• Have a $10 million Venture Capital Fund.

Science Center

Web site – www.sciencecenter.org

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Web site –www.sciencecenter.org

Real Estate SBU Commercialization Hub

• Sc Venture Formation

• Sc Capital

• Sc Management Services

• Sc Knowledge and Information

Exchange

Mission:

To be the world’s best science and technology commercialization engine.

Science & Technology Center

Science Center

• Innovation Philadelphia connects and provides access to skilled human capital.

• Innovation Philadelphia fulfills the need to provide networking and internships that benefit students, professionals, and Regional employers.

• Innovation Philadelphia attracts and retains knowledge workers, making the Region’s companies globally competitive.

Global / Regional Economic Development

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Regional Cooperation

© 2005 Innovation Philadelphia. All rights reserved.

The Knowledge Industry Partnership is a broad based coalition of Greater Philadelphia civic, government, business and higher education leaders working together to create positive first-hand experiences throughout the entire student life cycle.

Attract Engage Retain

Knowledge Industry Partnership

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Knowledge Industry Partnership & CareerPhilly

The Commonwealth of PA “Stay Invent the Future” program led to the creation of the Knowledge Industry Partnership.

The goal of CareerPhilly is to help students find jobs in the Greater Philadelphia Region by linking the Region's students to Regional employers after they graduate, and linking the students with employers while they are in school through internships.

Since April of ’03, CareerPhilly has:• More than four MILLION hits to its Web site• Hosted 9 internship fairs• Attracted over 4,000 students• Attracted over 700 companies• Offered over 4,100 internshipopportunities

• Hosted 5 career development workshops

The goal of CareerPhilly is to entice graduating students to remain in the Region as they begin their professional careers in order to stimulate the Region’s innovative and entrepreneurial economy. Retained graduates will: • Build the skilled workforce that companies

crave

• Attract new companies to the Region

• Increase the tax base

• Create a generation of future entrepreneurs

CareerPhilly

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CareerPhilly retains college students by linking the Region’s students to the Regional employers after they graduate, and linking the students with employers while they are in school through internships. CareerPhilly has three primary initiatives to retain college graduates in the Region.

• Internship Fairs

•

• Internship-In-A-Box Program

• CareerPhilly Web site

CareerPhilly

CareerPhilly.com is the first Web site dedicated to the career development of students in the Greater Philadelphia Region. The site provides college students with a search engine designed to help them find Regional job and internship opportunities.

The CareerPhilly Web site has:

• More than 3.5 million hits to the site

• 6,655 student accounts

• More than 2,000 positions available

on the site

www.CareerPhilly.com

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CareerPhilly Internship Fairs:

• CareerPhilly has hosted 9 Internship Fairs over the past

three years.

• Approximately 4,114

internship opportunities have

been offered at the Fairs.

• More than 3,200 students

and 700 employers have

attended the internship fairs.

Internship Fairs

• FREE specially designed, step-• by-step manual on creating and • implementing meaningful internship • programs in companies and • organizations.•• CareerPhilly has distributed 9,246 • Internship-In-A-Box programs • through its Web site and in a CD-• Rom format.

Internship In A Box

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IP’s International Accomplishments

• Attracted and hosted a United Nations (U.N.) Conference in

December 2003, the first U.N. Conference in the United States to be

held outside of Washington D.C. or New York.

• United Nations Educational, Scientific and Cultural Organization (UNESCO) has opened an

office in Philadelphia.

• Signed a Memorandum of Understanding to strengthen cultural,

educational, economic and trade ties between the cities. The two

cities have agreed to exchange information, organize conferenc es,

invite each other to participate in events, and take steps for both

sides to realize the benefits of the agreement, including increased

trade, foreign direct investment, and tourism.

GP2 strives to strengthen the Greater Philadelphia Region’s global interaction and outreach through connectivity and collaboration.

Greater Philadelphia Global Partners

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Why GP2 was Created?

GP2 was created to foster collaboration and connectivity between internationally-focused organizations in order to initiate and grow:

• International Trade

• Foreign Direct Investment

• International Travel and Tourism

• Immigration

• Cultural, Educational, and Scientific Linkages with

• Foreign Governments

Summer 2003 – GP2 created by City of Philadelphia Commerce Department and Innovation Philadelphia

Fall 2003 – More Partners join and GP2 Meetings begin, goals are outlined

November 2003 – GP2’s International Resource Guide published

December 2003 – GP2 hosts United Nations Forum

February 2004 – www.GPTWO.com created, and GP2 officially launched at City Hall ceremony

December 2004– Publication of the Global Plan, Phase I

GP2 History

45

• The Greater Philadelphia International Resource Guide and Web site

• Global Conference Initiative

• The Global Plan for Greater Philadelphia

GP2 Goals

The Greater Philadelphia Region International Resource Guide includes more than 100 private and public Regional organizations whose goal is to serve the needs of the international community.

The Guide is available in print and online at www.GPTWO.com.

GP2 Accomplishments

46

Global Plan for Greater Philadelphia

Phase I: “Globalizing Greater Philadelphia: Assessments and Recommendations”

GP2 Accomplishments

List of delegations that have visited Philadelphia.

IP is Addressing the Flat World

Innovation Philadelphia Global Interactions!

Ivory Coast

Taiwan

Russia

France

Wales

Palestine

Romania

Korea

JapanSpain

The Philippines

Sweden

Italy

India

ChinaJordan

Israel

Australia

United Kingdom

Portugal

Canada

Mexico

Panama

Columbia

Ireland

Germany Uzbekistan

Hong KongSingapore

Zimbabwe

South Africa

Senegal

Ghana

47

MissionWireless Philadelphia aims to strengthen the City'seconomy and transform Philadelphia's neighborhoodsby providing wireless internet access throughout thecity. Wireless Philadelphia will create a digitalinfrastructure to help citizens, businesses, schools andcommunity organizations make effective use of thistechnology to achieve their goals while providing agreater experience for visitors to the City.

Objectives• To spur economic development• To enhance community neighborhoods• To help overcome the digital divide• To reduce the cost of government

Wireless Philadelphia

• Business Plan launched April 7,2005.

• Network will be launched City-wide in 2006 to correspond with Ben Franklin’s 300th Birthday.

Regional Asset Mapping

48

What is needed?• The Greater Philadelphia Region’s innovation economy

must include critical mass of technology-based industries.• Strong research infrastructure capable of generating new

ideas & nurturing them through early-stage development.• Academic community has to leverage investment.• Eliminate “capital gap” for early investments.• Change “brain drain” to “brain gain” & create world-class

lifelong learning environments.• Greater coordination & collaboration among industry,

government, academic, & non-profit organization involved in economic development initiatives.

• Create public policy and programs that stimulate business innovation and growth.

Executive Summary

49

Key Indicator RatingsKnowledge Ratings

Key Indicator RatingsCapital Ratings

50

Key Indicator RatingsLocation Ratings

Knowledge Overview

51

Patent Productivity

Start-up Companies Formed from University Research

52

Early-Stage Venture Capital Investments

Gazelle Firms Employment

53

Creative Class Ranking

• Within 5 years, increase the annual science and engineering research investment in our Region to $1 billion. This will be accomplished by leveraging state, industry, academic science andengineering investment in the Region.

• Establish a nationally recognized Federal Research Center withinthe next 5 years.

• Create 25 university and research-based spin out companies per year with the next 5 years.

• Generate $100 million worth of new and incremental Early-stage/Seed Capital resources within the next 3 years.

• Attract 3 international conferences to Philadelphia focused on the Knowledge Economy within the next 5 years.

Resulting Regional Goals

54

Regional Cluster Identification and

Analysis

This is a Title:This is a sub-head Churning the

Greater PhiladelphiaInnovation Economy

A Roadmap for Regional Growth

Connecting the


Innovation Economy

55

Greater Philadelphia Region

This is a Title:This is a sub-head Churning the

Greater PhiladelphiaInnovation Economy

A Roadmap for Regional Growth

Connecting the


Innovation Economy

56

Research Approach

Qualitative• One-on-One Interviews (150+ conducted)

• Forums/Group Format with 8 Regional Organizations

• Two Online Regional Mindset Surveys (2600 recipients/800 responses)

• University Innovation Inventory

Quantitative•Review of Prior Regional Reports and Studies

• RAND RaDiUS Data on Federal Funding of R & D

• Private Sector R&D Spending

• Venture Capital Investment Data (GrowThink Research)

• Patents and Citations Analysis

• Global Technology Trends and Market Assessment

• ES202 Regional Cluster , Wages, Employment, Revenue Data

• Inventory of Regional Post Baccalaureate Skills Programs in Support of Science and Technology

Philadelphia County: Cluster Analysis by Output

57

Philadelphia Region: 11-County Aggregate; Cluster Analysis by Output

The Targets of Opportunity – Churn Indicators

58

Road Map Implementation

Next Steps / Hot Teams

The Targets of Opportunity

Five Prime Targets of Opportunity

Transforming Biomedical Research

ChemicalIndustries

The CreativeEconomy

Nanotechnology

Business Process,

Technology and Software

59

The Targets of Opportunity & Accomplishments


ChemicalIndustries

The CreativeEconomy

Nanotechnology

Business Process,


• Hosted Creative Economy (CE) Conference and Workshop in beginning of 2005

• Current goals include creation of a CE Convergence Center, CE Seed Capital Fund, and CE Assets & Capabilities Mapping

• Hosted “Make the Campaign ” event in November 2005• Planning Global Creative Economy Summit for June 12 -

14, 2006

Creative Economy – Innovation Philadelphia

• Mid-Atlantic Nanotechnology Alliance formed• Sponsored largest-ever Annual Regional

Nanotechnology Conference from April 18-20, 2005

Nanotechnology - Ben Franklin Technology Partners of SE PA

• Molecular Valley Business Plan Complete• Raising Funding for Implementation• Identifying industry partners and vital technologies for

commercialization• Intellectual Property Donation Program Developed

Chemicals/Petrochemicals - Innovation Philadelphia

• Business Plan Completed• Seed Capital Raised• Clinical Trials Supersite and Translational Research

Center in development • Intellectual Property Donation Program Developed

Transforming Biomedical Research –BioAdvance

StatusHot Team

Connecting the


Innovation Economy:A Road Map for Regional Growth

Business Process, Technology and Services Hot Team

60


Goal:

The Greater Philadelphia Region will be the world leader in addressing complex processes in large organizations through the application of advanced information technology to dramatically improve the leverage and utilization of assets and the economics of delivery of products and services.

THE RESULT WILL BE A RESEARCH CONVERGENCE CENTER.

61

Our key differentiation from other technology centers around the country and the world is based upon a fundamental difference in focus. Our Region has a unique process:• we focus first on understanding the major processes in business and other larger organizations and • then seek to apply or develop breakthrough technologies to dramatically improve the efficiency of these processes.

Connecting the


Innovation Economy:A Road Map for Regional Growth

The Creative Community Hot Team

62


The Summit

Come to Philadelphia from June 12-14, 2006

to Experience the Impact of Creativity

Location: Park Hyatt Philadelphia

63

What is the Creative Economy?

The Creative Economy is the sum of economic activity arising from those occupations that make original and valuable ideas their primary objective. Members of the Creative Economy have a high level of skill in the cultural, fine, or applied arts.

• Philadelphia Region’s Creative Economy generates $44 billion in revenue annually

• The Greater Philadelphia Region graduates –23% more art graduate students than the national average

• The Philadelphia Live Arts and Festival & Philly Fringe was highlighted as one of the season's best fringe festivals in Oprah's OMagazine. (August 2005)

Regional Creative Economy Facts

64

Regional Creative Economy Facts

• The Greater Philadelphia Region has more than 2,300 Web site Designers and Computer Consultants

• Since 1992 the economic impact of Philadelphia’s film industry has been more than $750 million

• Gross receipts of cultural organizations in Greater Philadelphia totals more than $1 billion per year

Goals of the Hot Team


ChemicalIndustries

The CreativeEconomy

Nanotechnology

Business Process,


Create a Business Incubator

Conduct Asset Mapping of the Creative Economy

Host an international Creative Economy Conference

65

Richard Floridaignited a movement upon publishing his book, The Rise of the Creative Class

Creative Economy Timeline

2002


November 2004

The Young & the Restless: How Philadelphia Competes for Talent study is published, which detailed the economic

importance of the young talented workers and their role in creating the new ideas that drive business success and

Regional economic progress.

66

The first Creative Economy Conference is held. The goals

of the conference were to discover what is being done to

improve upon Greater Philadelphia’s creative assets

and translate them into Regional growth.

December 2004



Attracted 60 representatives to a Creative Economy Workshop

facilitated by Larry Quick, a Strategist and Principal of Larry

Quick & Associates (from Australia.) He offered practical models of how to reshape an

economy or production capabilities by adapting 21st

Century Capability or (21CC).

January 2005

67


The University of the Arts creates their Center for the Creative Economy that brings together the Region’s world-class

assets in business, arts, and education and will serve as an incubator to link creative ideas to the resources necessary to

commercialize them.

September 2005


Arts and Technology Internship Fair held to link creative students to

creative employers.

March 2005

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The New Philadelphia Forum showcased new creative business ventures, resources, and

initiatives planned to grow the Greater Philadelphia Region’s Creative Economy and

also demonstrated the new City Creatives asset mapping tool.

May 2005


The Make the Campaign: Shape the Creative Economyevent provided an opportunity for the Region’s Creative

Community to develop marketing campaigns for the GreaterPhiladelphia Region's Creative Economy. The audience voted

for the best ideas using an audience response keypad.

November 2005

69


500 business and creative professionals representing design, architecture, fashion, music production, communications, film production, software development, the performing and fine arts, and Web design will gather in Philadelphia to understand how the Creative Economy contributes to

economic future of the world.

June 12-14, 2006

The Summit

The goals of the Summit are:• To acquaint Regional, national, and international

leaders with the impact of the for-profit and non-profit sectors of the Creative Economy

• To learn and share best practices how the creative industries interact and converge to generate wealth and create businesses and jobs within regions

• To showcase Greater Philadelphia’s creative assets to attendees coming from across the country and around the globe.

70

The Summit

Summit Themes will include

1. Creative Economy 101: The Criteria for Success

2. Creative Cityscapes: Developing Diverse and Interactive Environments

3. Funding Creative Ideas and Industries

4. New Creative Technologies for Reaching New Audiences

5. Creative Human Capital: The Key to Sustainable Growth

The Summit

Featured Speakers to Include

Christo and Jeanne Claude, creators of The Gates

Daniel Pink, author of A Whole New Mind and Free Agent Nation

John Howkins, author of The Creative Economy: How People Make Money from

Ideas

71

The Summit

Regional Best Practices

“Digital Domes: New Medium for Art, Science, and Education”

“An American Cultural Street in the 21st

Century”

“Creating Future Human Capital”

“Magnet Creative Centers”

The Summit

Regional Best Practices

Philadelphia Architecture & Design Tour

AIA Philadelphia

Mural Arts Tour

Philadelphia Mural Arts Program

Philadelphia Film Location Tour

72

National Best Practices

The Summit

Michigan

New York

Rhode Island

Illinois

“Cool Cities”

“Defining and Planning for the Creative Economy”

“The Secret Life of Creative Capability”

“Impact of Creativity on Politics”

International Best Practices

The Summit

“International Culture: Policies and Platforms”

“Building and Sustaining Cool Cities”

“Best Users of Innovative Communication Mediums”

“Textiles in the 21st Century”

UNESCO

Artscape, Toronto

London, England

Lyon, France

73

Summit Outcomes

Promotion of the Region’s Creative AssetsAnnouncement of future workshops and seminars to continue to focus on the RegionOpportunity to learn and emulate best practice initiativesOpportunity to continue to exchange ideas through Summit Web site

The Summit

Summit Supporters

The Summit

74

The Global Creative Economy Convergence Summit

June 12-14, 2006

Summit Themes will include

1. Creative Economy 101: The Criteria for Success

2. Creative Cityscapes: Developing Diverse and Interactive Environments

3. Funding Creative Ideas and Industries

4. New Creative Technologies for Reaching New Audiences

5. Creative Human Capital: The Key to Sustainable Growth

The Targets of Opportunity & Accomplishments


ChemicalIndustries

The CreativeEconomy

Nanotechnology

Business Process,


• Hosted Creative Economy (CE) Conference and Workshop in beginning of 2005

• Current goals include creation of a CE Convergence Center, CE Seed Capital Fund, and CE Assets & Capabilities Mapping

• Hosted “Make the Campaign ” event in November 2005• Planning Global Creative Economy Summit for June 12 -

14, 2006

Creative Economy – Innovation Philadelphia

• Mid-Atlantic Nanotechnology Alliance formed• Sponsored largest-ever Annual Regional

Nanotechnology Conference from April 18-20, 2005

Nanotechnology - Ben Franklin Technology Partners of SE PA

• Molecular Valley Business Plan Complete• Raising Funding for Implementation• Identifying industry partners and vital technologies for

commercialization• Intellectual Property Donation Program Developed

Chemicals/Petrochemicals - Innovation Philadelphia

• Business Plan Completed• Seed Capital Raised• Clinical Trials Supersite and Translational Research

Center in development • Intellectual Property Donation Program Developed

Transforming Biomedical Research –BioAdvance

StatusHot Team

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• The biotech and pharmaceutical industries are responsible for employing more than 509,000 people, either directly or indirectly in PA, NJ, and DE. These jobs result in $40 billionin business per year in the tri-state region.

• U.S. Production in the tri-state region

– 1st in pharma, medicine production, & healthcare industry employment

– 2nd for industrial R&D funds in pharma per capita

– 6th for venture capital investment in biotechnology

– 10th for medical instruments and supplies

– $1.6 billion in NIH funding with over 1,500 research grants awarded

Regional Life Science Facts

• 6 National Cancer Institute (NCI) designated Cancer Centers– Fox Chase– Jefferson– Penn– Temple– Wistar Institute– University of Pittsburgh

• Regional Life Sciences Employment & Training


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• 40,000 biological scientists in the tri-state region

• 1,500+ biotechnology, device & diagnostic,

pharmaceutical, and bio-agricultural enterprises are

located in the Greater Philadelphia Region

• 174,000 people directly employed by the life sciences in

the 11-county Greater Philadelphia Region

• 1 in 5 of the nation’s physicians train in the Region’s

medical schools and hospitals


• 80% of the world’s pharmaceutical companies have presence within 50 miles of Philadelphia

•


– Biotechnology companies include Centocor,

Cephalon, Medarex, ImmuneControl, Macroarray,

Gentis, Cira

– Pharmaceuticals companies include Aventis, Merck,

AstraZeneca, GSK, BMS

– CROs include Covance, AppTec

– Venture capital firms include Quaker BioVentures,

PAX, Care Capital, Domain, TL Ventures

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The Greater Philadelphia Region (PA, NJ, DE) has the Regional assets to help biotechnology companies succeed:

Regional Assets

Pennsylvania Bio

• A resource dedicated to helping advance the companies and research institutions that are developing ground-breaking therapies, devices, diagnostics, and vaccines.

• Provides networking opportunities and targeted introductions to help members showcase their strengths and to meet people and organizations that will help them advance.

• The only statewide association in the Commonwealth dedicated to advancing the bioscience cause on both state and federal levels.

• Mission - To be a catalyst to ensure Pennsylvania’s position as a global leader in the biosciences by developing a cohesive community that unites the Region’s biotechnology, pharmaceutical, research, and financial strengths.

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Located in the state's capital of Trenton, the BiotechnologyCouncil of New Jersey (BCNJ) was chartered in 1994 witha three-fold mission:

• To formulate and advocate public policy to elected officials andregulators.

• To acquire and coordinate resources and provide services to members

• regarding issues critical to building successful biotechnology enterprises.

• To enhance awareness and appreciation of New Jersey's biotechnology

• industry.

Biotechnology Council of NJ

Delaware Economic Development Office

• Offers a variety of support and assistance to existing and new biotech companies including finding companies wet lab space, securing capital, locating networking opportunities, providing information on workforce training programs and tax incentives, and facilitating other needs.

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Financial Institutions

Public Relations

Accounting Firms

Educational Institutions

Real Estate Firms

Intellectual PropertyLawyers Angel Investors

Venture Capitalists

Regulatory Boards

Consultants

Marketing Firms

Incubators and Technology Parks

Molecular ValleyConvergence

Center

CommercializationServices

BusinessExpansionServices

Corporate Venture Services

Seed CapitalFund

Chemical Futures

Exchange

Building an Economy:Chemical & Advanced Materials Cluster

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Chemical Derivatives

Ore Mine

Chemicals

PetroleumRefinery

Agriculture

Chemical Derivatives

Electronics

Paints & Coatings

Automotive

Fertilizers & Pesticides Food

Building & Construction

Paper

Textiles

Pharmaceutical

Appliances

Personal CareOil & Gas

Packaging

Adhesives & Sealants

Cleaners

Plastics & Rubber

Imaging/Photography

Nanotechnology

Biotechnology Medical


Value

Added

Chemical Derivatives End UserChemicals

Ethylene~$0.20/lb

Petroleum Refinery(Sun Oil)

Example of Chemical Derivatives

Fluoropolymere.g.Teflon~$5/lb

PolymerManufacturer(DuPont, Atofina)

FirstResponder(Philadelphia Fire Dept.)

Gore-Tex

FabricCompany(W.L. Gore)

~$50/lb

Vantage II

Apparel Company(Ricochet)

~$250/jacket


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Strategic Relationships Throughout the Region

Molecular Valley Convergence Center

Business Processes,Technology& Services

CreativeCommunity

Nanotechnology &Advanced Materials

Biotechnology& Life Sciences

Pharmaceuticals


Resource Guides

A comprehensive guide that lists over 170 organizations providing information and resources for entrepreneurs and early-stage technology companies.

A guide that highlights the Region’s sources for funding and offers practical strategies for growing companies.

Includes more than 100 private and public Regional organizations whose goal is to serve the needs of the international community.

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Regional Research

The Innovation and Entrepreneurial Index examines key indicators that position the Greater Philadelphia Region relative to other regions and establishes regional objectives based on current and potential Regional assets.

Connecting the Greater Philadelphia Innovation Economy: A Road Map for Regional Growth is the first-ever comprehensive analysis of the Region’s assets and served as the foundation for the Trust Team and Hot Teams.

Discusses the importance of attracting and retaining young workers (25 -34 year olds) to the Greater Philadelphia Region.

Focused on how the Greater Philadelphia Region can become more competitive internationally.

IP Links is your weekly resource for technology news in the Greater Philadelphia Region. Featured topics include life sciences, investments, federal funding, and community and economic development.

To view IP Links, please visit:

www.IPphila.com/IPLinks

Distributed to 17,600 people weekly.

Regional News & Marketing

IP Magazine is a quarterly publication produced by Innovation Philadelphia. Each issue features articles highlighting global and Regional initiatives, investments, research and commercialization, events, and more.

12,000 are distributed quarterly.

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• Centers of Excellence

• Science Centers

• Research Parks

• Incubators

• Innovation and Commercialization Centers

Center of Excellence:An Introduction

Centers of Excellence are generally defined as organizations managed by specialized professionals whose main aim is to increase the wealth of its community by promoting their industry or technology sector. COEs tend to consist of partnerships between academics, business people and government interested in advancing a region’s particular industry cluster.

84

Structured as a collaboration led by its founding members, Ben Franklin Technology Partners of Southeastern Pennsylvania, Drexel University and The University of Pennsylvania, the Nanotechnology Institute (NTI) represents a comprehensive model for nanotechnology-driven regional development in the pharmaceutical, life sciences and materials industries. Funded by the Commonwealth of Pennsylvania as a catalyst that facilitates the research, development and commercialization of nanotechnology’s real world applications in biomedical research, disease diagnosis and therapy, the NTI will harness the potential of this new scientific frontier to propel nano-based activities.

Nanotechnology Institute: Mission

Aspects of the NTI that differentiate it from traditional models of research institutions include:

A Collaborative Enterprise among academic and research institutions, corporate partners, private investors, government, and economic development organizations.

A Multi-Institutional/Inter-Disciplinary Research & Development Approach to facilitate the transfer and commercialization of discoveries and intellectual knowledge that support rapid application of nanotechnology to the life sciences sector and the creation of new enterprises around this technology.

A Comprehensive Approach requiring the strategic alignment of six programmatic areas: Scientific Research & Development; Risk Capital & Commercialization; Community of Interest Networks; Entrepreneurial Enterprises & Business Development; Education & Workforce Development, and Economic Research.

Nanotechnology Institute:Model

85

Nanotechnology Institute:Fast Facts

• $9.3 million award received from Pennsylvania

• $600,000 award from the U.S. Department of Education for Workforce Development and Education

• $600,000 NSF Partnership for Innovation Award for Workforce Development strategy given to NTI partner University of Pennsylvania

•Four multi-institutional, inter-disciplinary research teams involving 41 faculty representing 9 prestigious academic and medical institutions formed

• Four-state NanoForum ® founded

• Four-state nanotechnology asset mapping study completed

• International partnerships created

• Multi-state alliances for research, commercialization and workforce development

• MOA/MOUs signed with federal facilities

• Sponsorship, planning and participation in Pennsylvania’s first statewide nanotechnology symposium

They are generally defined as organizations managed by specialized professionals whose main aim is to increase the wealth of its community by promoting the culture of innovation and the competitiveness of their associated businesses and knowledge-based institutions. Science centers provide not only the specialized physical space, but also a range of other value-added services to help commercialize technology and innovation.

Science Centers: An Introduction

86

Science Centers – Example:University City Science Center

University City Science Center:Mission

The Science Center is a developer of knowledge communities. Whether physical or virtual, regional or global, knowledge communities create a culture of innovation and competitiveness based on the collective and connected assets of its members.

The Science Center seeks to stimulate and facilitate the flow ofknowledge and technology among leading universities, research institutions, companies and service providers to create jobs andgenerate revenue - in short, regional wealth.

87

Science Center:Fast Facts

•University City Science Center - oldest and one of the world’s largest research parks in the world.

•Located in Philadelphia’s University City, the Science Center technology park is adjacent to the University of Pennsylvania and Drexel University campuses.

•Established 40 years ago, the Science Center’s University City Technology Park now covers more than 17 acres and more than 2 million square feet.

•The Science Center’s 30 shareholders represent major institutions of higher education, medical facilities, foundations, and non-profit research organizations from the Greater Philadelphia region and beyond.

•It provides a collaborative environment with access to intellectual capital from nearby academic institutions and businesses for nearly 200 tenants.

The Science Center’s advocacy work is built on Greater Philadelphia’s assets:

•As a major center for the American pharmaceutical and life-science industries, 80% of the nation’s pharmaceutical employment is found within a 50-mile radius of Philadelphia.

•The Region is home to some of the most prestigious teaching hospitals in the country, and boasts the highest percentage of physicians engaged in research of all U.S. metropolitan areas.

•The Region is an emerging a leader in the exciting new fields of bio-informatics and nanotechnology.

•Because of this pioneering work, the Region consistently receives a sizable portion of federal research funds, including nearly $600 million from the National Institutes of Health alone.

Science Center:Advocacy

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Management Services is acritical component

of “powering commercialization

Investors• Higher success rate

• Lower risks• Cost effective

• Reliable mechanism

Expert Resources• Easier to commit time/

energy• Access to opportunity

stream• SC stability/reliability• Prestige

The Science Center• Attract highly skilled expertise• Attract more new opportunities• Enhance success of

investments• Support a larger base of

people

Management Services

Start-up Companies• Expertise they might not

otherwise get• Broader range of help

• Higher quality end results• Easier access &

transactions• Cost effective

Region/Other Centers• Attract more entrepreneurs• Stretch investment funds• Deeper base of jobs• Easily extends to other

centers

Management Services

The Science Center can help entrepreneurs and intrapreneurs overcome barriers. It provides a customized portfolio of business development services to help early stage companies survive the often-turbulent period of initial commercialization and reach their full potential.

The Science Center delivers its commercialization servicesthrough the following means: vIncubationvBusiness MentoringvNetworking

Science Center :Commercialization

89

Research Parks:An Introduction

•Research parks are defined as organizational entities that sell or lease spatially contiguous land and/or buildings to businesses or other organizations whose principal activities are basic or applied research or development of new products or processes.

•Master planned property and buildings designed primarily for private/public research and development facilities, high technology and science based companies, and support services

•A contractual, formal or operational relationship with one or more science/research institutions of higher education

Research Parks:An Introduction

•A role in promoting the university's research and development through industry partnerships, assisting in the growth of new ventures and promoting economic development

•A role in aiding the transfer of technology and business skills between university and industry teams

•A role in promoting technology-led economic development for the community or region

90

Research Parks:Facts

•48% of the research parks are university affiliated, non-profit entities

•22.7% have a university corporate structure

•13.3% are governmental (non-university)

•9.3% are private, for profit entities, and 6.7% are joint ventures

•54.7% of university parks' land is at least partially owned by a university

•26.7% are owned at least partially by a university affiliated, non-profit entity

•22.7% have governmental (non-university) ownership and 17.3% are owned by private, for profit entities.

Research Parks:Facts

Occupancy Criteria

•46.7% of parks require university or governmental connections for occupancy

•46.7% have mixed use

•36% are discipline specific

•9.3% have mixed use plus housing

Tenant Selection

•34.7% have a board that approves the selection/14.7% are approved by the university.

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Research Parks – Example:Research Triangle, North Carolina

Research Triangle Park (RTP) is a public/private, planned research park, created in 1959 by leaders from business, academia and industry.

• The Park encompasses 7,000 acres of North Carolina pine forest and has approximately 1,100 acres for development.

• 131 organizations are located in the Park

• 100 research and development-related organizations

• Approximately 50% of the employees in the Park work for multinational corporations

• Development surpasses 19 million square feet

• Capital investment exceeds $2 billion

• Total payroll is estimated at $2.7 billion

Research Triangle Park:Fast Facts

92

A business incubator is an economic development tool designed to accelerate the growth and success of entrepreneurial companies through an array of business support resources and services. A business incubator's main goal is to produce successful firms that will leave the program financially viable and freestanding.

These incubator "graduates" create jobs, revitalize neighborhoods, commercialize critical new technologies and strengthen regional and national economies.

Incubators: An Introduction

12 Key Differences Between Old & New Incubators

• Space Renter

• Not-for-profit• Dependent• Partners• Funder• Manager• Facility

• Idea driven• Lifestyle• No tech• Economic development• Geographically restrictive• Insulated

• Innovation Center

• For-profit• Self-sufficient• Stakeholder• Seed Investor• President• Innovation without walls

• Market driven• High growth• Advanced technology• Sustainable development• Global• Expanded network

93

Incubators – Example:Port of Technology

The Science Center is a total “Venture Ecosystem" that forms and funds early-stage life science and technology companies, accelerates their commercialization and provides the infrastructure and community they need to flourish.

Incubators – Example:Science Center

The Science Center is an attractive “soft landing” place for international companies to launch their US businesses and a powerful economic engine for the regional economy.

94

Science Center Incubator

The facilities at the Science Center serve as:

•A physical hub, bringing together entrepreneurs, scientists, and established businesses with the resources they need.

•Science Center facilities include almost 2,000,000 square feet of space dedicated to the advancement of life science and technology companies.

•It ranges from incubator space with fully-equipped laboratories to “plug ‘n play” offices for entrepreneurs, to customized tenant office space.

Plug & Play Environment

• Two floors dedicated to technology startups

• First-class wet labs

• High-speed Internet connection

• Collaborative environment

Science Center Incubator

95

International Alliances

ArgentinaAustraliaCanadaChileChinaCzech RepublicGermanyIndiaIrelandIsrael

JapanKorea Spain

RussiaMexicoUkraine

ThailandSingaporeVenezuela

United Kingdom

Science Center Global Gateway

Applied ResearchProject

DevelopmentRisk

•Development Risk•Market Risk•Management Risk•Growth Risk

Innovation

Innovationand

Commercialization Corporations

Start-up Company•Market Risk

Seed Capital•Market Risk•Management Risk•Growth Risk

Laboratory &Office Space

•Business Plan Consulting•Financial Expertise•Management & Operations Consulting

•Marketing & Sales Strategies

•Guidance in Accessing Financing

•Training•Market Research•Due Diligence•Technical Review

$ QualityInvestments

Independent 501(c)(3) not -for-profitIndependent Board of Directors

President with commercialization experienceFor Profit Seed Capital Funds

General IncubatorServices

InvestmentGrade

Technologies

ICC’s Expand the Life Cycle

96

…has many complex pieces!

Market-drivenOpportunity

MatchingResearch $$

ScientificResearchTeam

Commercial-izationPartner

Risk $$

FederalGrants

QualifiedManagement

Private/Public/UniversityPartnership

StrategicImplementation,Market Research& Marketing Plan

The Road from Basic Research to Commercialization

All of the puzzle pieces must come together early in order for the project to have any hope

of commercial success

Market-drivenOpportunity

MatchingResearch $$

ScientificResearchTeam

Commercial -izationPartner

Risk $$

FederalGrants

QualifiedManagement

Private/Public/UniversityPartnership

StrategicImplementation,Market Research & Marketing Plan

The Road from Basic Research to Commercialization

97

What Worked For IP

• Integrated Science & Technology Collaboration for Philadelphia

• Private sector leadership

• Functions as a business

• Successfully manage a technology investment portfolio for ROI

• Operational flexibility

• Accountability with measurable outcomes

• Experienced professional team

• Focus on the entrepreneur’s needs

Implementing a New TBED Paradigm

• Willingness to deviate from traditional and parochial perspectives

• Willingness to encourage public investment and risk taking

• Developing trust through collaboration

• Ensuring the paradigm is responsive to partners’missions

• Building consensus of all constituents through education, participation, and positive outcomes

• Move from technology-based economic development to innovation-based economic development

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What’s Next for Me?

•True Product id produces integrators for anti-counterfeiting security surveillance applications and provider of integrated tracking devices and services.

•The Company delivers “cradle to grave” tailored solutions for governments, armed forces, and industry, through its proprietary technology and through converging technologies products, and services.

What’s Next for Me?

•ID TheftØIdentified as the world’s fastest growing crimeØEstimated cost in time and money to correct identity theft in the in the US was over $52 billion/297 million hours in 2003

•Currency counterfeitingØOne of the oldest crimes in history

•Brand/Product CounterfeitingØCost of counterfeit products and brands includes safety, jobs, tax avoidance & business lossesØUS businesses have lose an estimated $200 billion a year

•Employee Fraud and AbuseØWhen an employer issues or makes available, assets to its employees, it will inevitably experience some degree of theftØEmployee theft costs $9/day per employee or $2400/annually

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“It is not the strongest of species that survive, nor the most

intelligent, but the ones most responsive to change.”

Change is Inevitable

-Charles Darwin

Richard A. BendisPresident and CEO

Innovation Philadelphia2600 Centre Square West

1500 Market StreetPhiladelphia, PA 19102

(215) [email protected]

www.IPphila.com

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Developing Entrepreneurship & Technology Parks for ......Innovation Zone (KOIZ) and Keystone Innovation Zone (KIZ) IP Strategic Plan – Where We ’ve Been • 1999 – John F. Street