Investment Needed to Advance Innovation Economy

Targeted investment would leverage the state’s new foundation in entrepreneurship education and support into productive businesses and good jobs.

Written by Mike Green

A vast number of West Virginians are interested in and aggressively pursuing entrepreneurship. We hear and read every day about the creativity of our citizens who are willing and eager to take chances, push the envelope, pursue their dreams and create new and exciting products and services. We truly are going through a metamorphosis to a new and exciting innovation/technology-based economy. A new economy starts with education, and good things are happening there. Many of our elementary school children are participating in programs like Lemonade Days, in which kids learn how much it costs to start a business, determine how many cups of lemonade they need to sell, how to price it, and how to make a profit. In addition, entrepreneurship curricula are rapidly being introduced at the middle and high school levels.

Our state Department of Education has a program called Simulated Workplaces, part of our Career and Technology Education initiative, which engages students in running real businesses. Our colleges and universities all have entrepreneur programs that encourage a new attitude toward taking chances. For just one example, at the LaunchLab startup resource center at West Virginia University one can develop a business plan, conduct market research, protect intellectual property, find technical development expertise, recruit team members from the university community and private sector, gain introductions to industry-specific experts and mentors, develop an investor presentation, and gain access to initial customers. There is no question that we have the people and the intellectual capacity to actively participate in this innovation/technology- based economy. But to accomplish our goal here requires a new, concerted effort and an aggressive investment of time, effort, and energy by both the public and private sectors. “Stuff” does not happen on its own and without investment. Investment in two broad areas would move the needle.

The private sector must participate by

⇒Influencing school curricula. Executives who hire locally could provide local school teachers or administrators real examples of how math and science are applied in the production of specific products. Students are much more likely to embrace and understand those principles if they can see the direct application of the academics.

⇒Talking to kids in our schools, especially in our career and technical schools. Great jobs are out there for our kids. They just need to see with their own eyes how the “stuff” they are learning in school is applicable to their career path. They will also see that regular folks like them can become executives in corporate America. Our businesses also need to invest in their local schools and create internships for worthy students.

When we talk about investment, we naturally get to financial investment— the need for capital. Our legislature must provide sufficient funding for this endeavor.

⇒Our neighboring states all provide funding and programs for entrepreneurs and early stage companies. Innovation Works in southwest Pennsylvania (I was a board member for six years) invested more than $60 million in more than 200 technology start-ups. Those companies created thousands of new jobs and attracted follow-on capital of over $1.6 billion since their seed fund began in 1999. Ohio, Virginia, Maryland, and Kentucky have all recognized the need for investing capital and creating programs to spur entrepreneurship. These states have active angel organizations as well as venture capital investors. In West Virginia we have an ad hoc collaborative effort between TechConnect West Virginia, the INNOVA Commercialization Group, the West Virginia Jobs Investment Trust, the West Virginia Small Business Development Center, and several other organizations, public and private. Past funding has come from federal and state government organizations, but never enough sustained funding. We need the legislature to provide more funding in order for these groups to grow and continue to provide mentorship.

⇒Education needs funding, too. Our own governor was selected to lead the nationwide Council of State Governments, turning its focus on workforce development needs, particularly in the area of STEM (Science, Technology, Education, Math). The council he created last year in West Virginia came back with specific recommendations, including funding recommendations, as to how STEM programs can prepare our citizens for the jobs that will be needed over the next decade. Programs like this require leadership and organization, but they also require substantial funding.

It has been proven over and over that state funding does work and that profits from funded companies are routinely reinvested to provide new opportunities. If the state leads, there is no doubt that financial institutions, the private sector, angels, angel groups, venture capitalists, and other private equity entities will join in and provide additional funding to perpetuate and sustain growing businesses.


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