By guest authors Irina Patterson and Candice Arnold
Joe: From time to time, the state of Maine may issue bond funds for a program that helps research institutions and companies to secure necessary R&D infrastructure and capital equipment.
That program is closed right now, but we have been going through a process of awarding that money over a couple of years. That was called the Maine Asset Technology Fund.
It’s yet to be determined if Maine will put more bonds out to referendum for that, but that’s been a pretty big focus for MTI over the past couple of years in the state. We’re really seeing some good results. That was a $53 million bond program that went out the door.
One of the other programs that MTI oversees and administers is the Cluster Initiative Program. We’re back to matched grants again.
The Cluster Initiative Program is a program we administer and offer to help boost the strength and scale of Maine’s high-potential technology clusters.
Overall, MTI focuses on seven general technology sectors in the state of Maine. Any one of those given sector entrepreneurs, or a number of them together, may come in and apply for the Cluster Initiative Program.
For instance, there’s been an application from the information technology sector. That would come in for an initiative that might help information technology companies either network or access skills and resources through a collaborative effort in the Cluster Initiative Program. Again, that’s targeted not so much at individual companies but more at general activities that will address a broader scale of companies in that cluster.
Irina: Roughly, how many information technology businesses have applied to you for grants?
Joe: It’s not just information technology companies, but overall, MTI has funded over 1,400 projects and over 600 businesses in all of the seven technology sectors that we focus on, since fiscal year 1999. In over 10 years, if you include the $53 million bond program that I told you that we administered, we’ve funded over $106 million of funding into research and development across our programs. That’s leveraged about $173 million or more of co-investment in the state.
Back to your question, I can give you a relative number. Of the seven technology sectors that we invest in, [two] sectors represent almost 58,000 jobs in Maine or roughly 10% of our jobs and probably 13% of our payroll, with an average wage in those sectors that is about 37% higher than the average Maine job.
Irina: How many businesses have you funded in the past 12 months?
Joe: In fiscal year 2010, we funded 130 projects for $6.1 million.
Irina: Out of those, how many were related to information technology software, online e-commerce, or anything to do with the Internet?
Joe: Roughly 15% of those.
Irina: Your geographical focus is the entire state of Maine, right?
Joe: Yes, all of the state of Maine. The seven sectors we invest in – technology sectors – are biotechnology; composites and advanced materials; environmental and energy technologies; advanced technologies for forestry and agriculture; information technology, marine and aquaculture technology; and precision manufacturing.
Irina: What is the size of your funding resource?
Joe: Our core funding resource, in general appropriation, is in the neighborhood of $6 million to $6.5 million a year.
Irina: What is the source of your deal flow?
Joe: I’ll try to focus on the direct business investment and business innovation programs. Those will come from a broad spectrum. Since we work and will invest in a really broad spectrum, anyone from inventors in a garage at smaller dollar amounts all the way up to, in some cases, public traded companies.
Many of those – and we’ve got a double-bottom-line mission here, you know, a return on investment and a social goal – many of those leads will come from business development specialists who work for the state of Maine. Many of them will come from the private sector, angel investor or venture capital investors.
The general nature of MTI’s space, of where we invest, is usually much more in a high-risk area than the typical angel and certainly venture capitalist might be taking.