John Thompson: Use the Federal Gust of Wind to Develop the Indiana Technique for Innovation and Entrepreneurship
With Indiana considering raising $ 3 billion from the American Rescue Act, here are a few ideas that will aim to build the state’s strong fiscal position, accelerate its business recovery and competitive growth, and ensure future economic resilience by seizing this golden opportunity, transformative growth.
A vision is now emerging for the next 10 years in Indiana as major drivers revolutionize companies and industries. These drivers will transform communities across the country, the business as we know it today, and even the way we live. These drivers are already beginning to unfold, and states with a vision and a disciplined plan to take advantage of these drivers will begin to outperform other states and nations. Some states will see a new era of prosperity, growth, and thought leadership while other states and nations will be left behind.
These drivers require the adoption of a plan that not only includes building and encouraging the industry to adapt and change, but also a strategy to align workforce development, education (preschool through graduation), infrastructure investments, taxation policies, and innovation and entrepreneurship to Maximize Indiana’s competitiveness for the next decade.
So what are some of these drivers? One is the dramatic convergence of life sciences, data analysis, and engineering. Others are the increasing use of artificial intelligence, cybersecurity, 5G, quantum computers, advanced and additive manufacturing, digital thread, autonomous mobility, robotics, hypersonics, trustworthy microelectronics and more at the intersection of traditional sectors and digital technologies. Major areas of rapid advances in biotechnology, pharmacy, and genetic engineering will continue to change our lives dramatically over the next 10 years.
Building an innovation and entrepreneurship strategy from lifestyle companies through high potential, high growth companies that align with strong public and private skill and educational development strategies like the Eleven Fifty Academy should be the foundation for this transformative change. The broad strategy would include programs, grants and investments. Today’s programs are just part of the vision to fully align Indiana’s ambitions to become a national leader in innovation and entrepreneurship.
Let’s set specific spending targets by starting with an area that matters to our state, which is Advanced Manufacturing with $ 200M in Manufacturing Readiness Grants. While we are among the top 3 countries in advanced manufacturing, we are losing productivity more quickly than in other countries. Therefore, the continuation of a program implemented last year with great success with high demand and a 7x multiplier in co-investments to encourage upgrading devices with the latest hardware / software will improve productivity and reshoring production of critical consumables such as PPE , pharmaceutical ingredients and much more.
Targeted support of up to $ 250 million for the growth and appeal of smart manufacturing in the following sectors to ensure adequate supply chain capacity, productivity and rewarding jobs in healthcare, PPE, microelectronics and autonomous vehicles. This would position Indiana as the location of one of the 10 regional innovation centers listed in the proposed Endless Boundaries Act written by Sens. Todd Young and Chuck Schumer.
Invest up to $ 150 million in strategic growth sectors through public-private partnerships in the areas of smart manufacturing, fast and secure communications, microelectronics and future mobility with alternative energy generation and storage. Indiana’s success with public-private initiatives resulted in our private sector and foundation partners investing much more, which likely resulted in a $ 1 billion co-investment.
Raise funding for existing programs up to $ 250 million, including through thematic funds such as the Community Ideation Fund, the Nexus (University Startup) Research Commercialization Fund, and the Angel Fund. Form an accelerated growth fund that can work with private angel and venture funds. Strongly encourage collaboration with Next Level Fund and its Portfolio Fund of Funds. Creation of a lifestyle entrepreneurship fund to promote entrepreneurship across the state in every community, including financial literacy training, coaching, mentoring, and access to capital.
Augment Redevelopment Tax Credits fund up to $ 100 million, plus an additional $ 100 million for broadband. Invest up to $ 50 million in digital literacy, including coding and cyber, with free basic education and progressive income-sharing for further education. Broadband combined with digital literacy enables residents across the state to be more actively involved in careers with higher wages.
Attracting and retaining talent is at the heart of Regional Cities 2.0, which Governor Eric Holcomb and the General Assembly are working on at a significantly higher level of funding than in 2016. Also, there are targeted strategies to recruit talent with increasing numbers of family members, employing numbers that allow workers to live wherever they want. Bill Oesterle shares wonderful ideas on such strategies.
The programs above are effective and important, but they do not constitute a concerted and effective strategy for Indiana to differentiate itself from other states across the country.
With a well-designed, efficient and collaborative innovative and entrepreneurial structure in our state, Indiana can leverage important underlying assets that can serve as rocket fuel to maintain Indiana’s competitive position. This rocket fuel includes low cost of living, low taxes, a decent regulatory environment, low debt, part-time legislation, little government intervention, and excellent public and private higher education systems with three leading research universities and a fourth high-tech university.
To do this, we must aggressively attract new ideas and entrepreneurs from across the country and around the world who are ready to start and build businesses with high potential, high growth, and high wages in a business-friendly state. We also need to attract and / or develop venture capital and private equity firms to either be headquartered here or have a significant presence in our state.
With over $ 1 billion in direct investment in innovation and entrepreneurship, as well as private sector investment, we would attract entrepreneurs and venture capital / private equity firms to accelerate our growth and cement our success. Most states do not have the financial strength or the freedom to invest in an innovation and entrepreneurship strategy like Indiana.
Thompson is Chairman and CEO of Thompson Distribution Co. and a member of the Board of Directors of Indiana Economic Development Corp. He is also a director of the Central Indiana Corporate Partnership and the Indy Chamber.