The time has come for the Midwest to step outside its comfort zone. For too long has there been an emphasis on investing in biotechnology, life sciences, energy, and health care.
Yesterday Wisconsin Senator Russ Feingold announced his E4 initiative for small business innovation. The plan targets "energy innovation; water quality and security; domestic security and transportation." This is a step in the right direction and there is no doubt that these are some of the areas are the ones in which the Midwest is strongest.
It's a good idea to play to your strengths. But that isn't to say that there aren't other strengths in the Midwest. Of the top twenty Computer Science graduate schools in the Nation, the Midwest has four with the Universities of Illinois, Wisconsin and Michigan as well as Purdue. The exact same can be said for Biomedical Engineering, yet there is a significant gap in funding between the two disciplines.
Looking at the list of Wisconsin angel investments in the past year, this discrepancy is still apparent. Over $69 million in funding went to life sciences and biotechnology with another $50 million going to energy. In comparison, Information Technology saw only $7 million in angel investment. In addition, Feingold's plan really amounts to increasing funding for Federal grants through the SBIR and STTR programs. This doesn't necessarily flow as easily into IT as the other industries.
Despite this gap in funding there is significant evidence that large IT companies are taking an interest in the region. Recently, both Google and Microsoft have opened offices here in Madison and there is expectation that more will follow. It's time for the policy makers and investors in the Midwest to catch on to what everyone else is staring to see. There certainly isn't a lack of talent here, we just need to be better at retaining it.
Dale, Great post. We should chat sometime, I'm in Milwaukee and think about this stuff all the time. I work in IT for GE Healthcare and love start-ups. Best of luck with yours and check out my blog if you have time. http://ryanagraves.com
Posted by: Ryan Graves | September 11, 2008 at 08:12 PM