You may have heard the old saw, “great ideas sell themselves.”
After all, look at Steve Jobs and Steve Wozniak working in the family garage, funding their fledgling company by selling a used Volkswagen bus and a scientific calculator. That story is legendary, but unfortunately it’s also the exception. Today, turning a brilliant idea into a market-ready product or process requires venture capital, legal advice, startup mentors, sophisticated business acumen and collaborative workspace.
At Penn State, we recognize that great minds need support. That idea is at the heart of Penn State’s new $30 million investment in economic development and student career success. This investment includes a one-time, startup and capital investment as well as annual funding of more than $5 million, although we expect that number to grow as we share our vision. I look forward to working with Gov.-elect Tom Wolf, his administration, legislators, business leaders and concerned citizens to maximize the impact.
By leveraging our size and broad research strengths, Penn State will be a driver for job creation, economic development and student career success. Our aim is to accelerate the transfer of new ideas into useful products and processes that encompass a broad range including: energy, food security, environmental protection, health care, manufacturing, educational technologies, medical devices and pharmaceuticals.
Penn State is uniquely positioned to achieve this ambitious goal. Our institution ranks in the top 20 U.S. universities in research productivity, and consistently tops $800 million in research expenditures annually. In addition, Penn State is the single largest contributor to the state’s economy, generating more than $16 billion annually.
This success has translated into job creation and a reputation that helps students land competitive jobs. Nearly every business magazine survey places Penn State at or near the top in starting salaries for graduates and in producing an exceptionally prepared workforce.
But in today’s competitive economic climate, we must do more than just keep the doors open to innovation. We need deliberate strategies to promote economic development and a culture that rewards entrepreneurship — not just in STEM (science, technology, engineering and math) fields, but in the arts, health and human development, education and more. We are prepared to invest for the long term because the outcomes will benefit generations of Pennsylvanians.
A recent study indicates that every $1 million in research and development spending generates 36 jobs. And, not surprisingly, the lowest unemployment rates are consistently found in the areas of the highest concentration of research activity. The Association of University Technology Managers reports that despite reduced federal research funding, there has been a 16 percent year-to-year increase in the number of new technology business startups based on university research. Net sales from new products totaled nearly $23 billion.
Through its $30 million investment, Penn State is poised to build a stronger entrepreneurial ecosystem around our campuses, and we are pursuing this goal on several fronts. We plan to create flexible and vibrant physical spaces in key locations across the Commonwealth to host entrepreneurial boot camps that will allow individuals and groups to incubate their ideas and develop viable businesses.
We will be hiring dozens of entrepreneurs-in-residence and new faculty members in areas of potential economic impact to serve as a catalyst for both innovation and marketable products. Through new faculty reward structures, we are promoting interdisciplinary partnerships to foster productivity and creative solutions.
This infusion of tens of millions of dollars also allows Penn State to launch an online branded platform to encourage outside investment in startup companies, as well as provide the expertise to kick-start promising new companies. Need legal advice? It will be there. Need assistance navigating the patent process? Just ask. Help at every stage of the entrepreneurial process is our goal. Our initial $30 million investment will be augmented through fundraising and industry and government partnerships to bring in additional expertise and resources.
In concert, these investments will create a powerful path to economic development, with strong local and state impact. They also will allow us to train students at the cutting edge, and place students in those emerging fields and job opportunities. This is what it means to be a public university that combines excellence in teaching, research and service. It also embodies our mission of ensuring access to a top-notch education and improving the quality of life for everyone in the state, and society in general.
Thank you for your support.