(ARIZONA)—In today’s fast-paced environment, there are few who can afford to spend precious time and energy on activities that do not deliver proven value, personal growth and satisfaction or that take away from spending quality time with the meaningful people in their lives.

How would you like to experience all these important necessities of life under one giant umbrella? You can.  The ARIZONA SCITECH Festival delivers all the above and more through its 250+ events, demonstrations, tours, concerts, hikes, expos, festivals and community fairs going on throughout Arizona beginning this week that will offer everything you can imagine. And, you can share it with whomever you like…from the smallest of the small to the most mature in our communities.  All ages, cultures and interests are represented…all you have to do is look for your interests through the SCITECH Festival. And, for our Latino community, the ARIZONA SCITECH festival has produced a Spanish-language version of its statewide Schedule of Events ( There is something for everyone!

This coming week through the Festival brings Tucson residents and visitors a University of Arizona College of Science, “Living Beyond 100” Lecture, along with an artistic and colorful poster exhibit at the Joel D. Valdez Public Library and a Tucson Young Professionals First Friday event. In Goodyear, be one of the first to experience the Botanical Drawing Exhibit at Estrella Mountain Regional Park, head-up Scottsdale way and get lost in the Scottsdale Learning Communities Showcase featured on five different dates in February, at five different High School locations; and join community friends, neighbors, state and local dignitaries for the official launch of the ARIZONA SCITECH festival on Saturday, February 4, at the Arizona Science Center from 10 a.m. to 5 p.m. Be prepared to be enlightened as you walk into an atmosphere of science, technology and creativity featuring Innovations in Bioscience throughout the Center! It’s FREE!

Give the gift that keeps on giving to those you care about…and, especially yourself! Treat yourself to an ARIZONA SCITECH festival happening, today!



The Coming Tech-led Boom


In January 1912, the United States emerged from a two-year recession. Nineteen more followed—along with a century of phenomenal economic growth. Americans in real terms are 700% wealthier today.

In hindsight it seems obvious that emerging technologies circa 1912—electrification, telephony, the dawn of the automobile age, the invention of stainless steel and the radio amplifier—would foster such growth. Yet even knowledgeable contemporary observers failed to grasp their transformational power.

In January 2012, we sit again on the cusp of three grand technological transformations with the potential to rival that of the past century. All find their epicenters in America: big data, smart manufacturing and the wireless revolution.

Information technology has entered a big-data era. Processing power and data storage are virtually free. A hand-held device, the iPhone, has computing power that shames the 1970s-era IBM mainframe. The Internet is evolving into the “cloud”—a network of thousands of data centers any one of which makes a 1990 supercomputer look antediluvian. From social media to medical revolutions anchored in metadata analyses, wherein astronomical feats of data crunching enable heretofore unimaginable services and businesses, we are on the cusp of unimaginable new markets.


The second transformation? Smart manufacturing. This is the first structural shift since Henry Ford launched the economic power of “mass production.” While we see evidence already in automation and information systems applied to supply-chain management, we are just entering an era where the very fabrication of physical things is revolutionized by emerging materials science. Engineers will soon design and build from the molecular level, optimizing features and even creating new materials, radically improving quality and reducing waste.

Devices and products are already appearing based on computationally engineered materials that literally did not exist a few years ago: novel metal alloys, graphene instead of silicon transistors (graphene and carbon enable a radically new class of electronic and structural materials), and meta-materials that possess properties not possible in nature; e.g., rendering an object invisible—speculation about which received understandable recent publicity.

This era of new materials will be economically explosive when combined with 3-D printing, also known as direct-digital manufacturing—literally “printing” parts and devices using computational power, lasers and basic powdered metals and plastics. Already emerging are printed parts for high-value applications like patient-specific implants for hip joints or teeth, or lighter and stronger aircraft parts. Then one day, the Holy Grail: “desktop” printing of entire final products from wheels to even washing machines.

The era of near-perfect computational design and production will unleash as big a change in how we make things as the agricultural revolution did in how we grew things. And it will be defined by high talent not cheap labor.

Finally, there is the unfolding communications revolution where soon most humans on the planet will be connected wirelessly. Never before have a billion people—soon billions more—been able to communicate, socialize and trade in real time.

The implications of the radical collapse in the cost of wireless connectivity are as big as those following the dawn of telegraphy/telephony. Coupled with the cloud, the wireless world provides cheap connectivity, information and processing power to nearly everyone, everywhere. This introduces both rapid change—e.g., the Arab Spring—and great opportunity. Again, both the launch and epicenter of this technology reside in America.

Few deny that technology fuels economic growth as well as both social and lifestyle progress, the latter largely seen in health and environmental metrics. But consider three features that most define America, and that are essential for unleashing the promises of technological change: our youthful demographics, dynamic culture and diverse educational system.

First, demographics. By 2020, America will be younger than both China and the euro zone, if the latter still exists. Youth brings more than a base of workers and taxpayers; it brings the ineluctable energy that propels everything. Amplified and leavened by the experience of their elders, youth and economic scale (the U.S. is still the world’s largest economy) are not to be underestimated, especially in the context of the other two great forces: our culture and educational system.

The American culture is particularly suited to times of tumult and challenge. Culture cannot be changed or copied overnight; it is a feature of a people that has, to use a physics term, high inertia. Ours is distinguished by incontrovertibly powerful features, namely open-mindedness, risk-taking, hard work, playfulness, and, critical for nascent new ideas, a healthy dose of anti-establishment thinking. Where else could an Apple or a Steve Jobs have emerged?

Then there’s our educational system, often criticized as inadequate to global challenges. But American higher education eludes simple statistical measures since its most salient features are flexibility and diversity of educational philosophies, curricula and the professoriate. There is a dizzying range of approaches in American universities and colleges. Good. One size definitely does not fit all for students or the future.

We should also remember that more than half of the world’s top 100 universities remain in America, a fact underscored by soaring foreign enrollments. Yes, other nations have fine universities, and many more will emerge over time. But again the epicenter remains here.

What should our politicians do to help usher in this new era of entrepreneurial growth? Liquid financial markets, sensible tax and immigration policy, and balanced regulations will allow the next boom to flourish. But the essential fuel is innovation. The promise resides in the tectonic technological shifts under way.

America’s success isn’t preordained. But the technological innovations circa 2012 are profound. They will engender sweeping changes to our society and our economy. All the forces are in place. It’s just a matter of when.

Mr. Mills, a physicist and founder of the Digital Power Group, writes the Forbes Energy Intelligence column. Mr. Ottino is dean of the McCormick School of Engineering and Applied Sciences at Northwestern University.

Department of Treasury Lists Lenders Increasing Lending

The Department of Treasury listed Banks that have increased lending, by State, in the attached article.  Unfortunately, Arizona had only one bank showing a 1.1% increase!

By: Don Graves

Yesterday, Treasury sent a report to Congress that contains strong evidence that the Small Business Lending Fund (SBLF) is working. The report shows that institutions participating in the Small Business Lending Fund have significantly increased lending to small businesses, to the tune of $3.5 billion over their baseline (the average lending reported in the four quarters before the Small Business Jobs Act, which created the SBLF, was enacted). These loans are helping small businesses to grow, create jobs and support families in communities all across the nation.

Lending through the program is widespread. To date, 218 of the 281 participating community banks, or 78 percent, and 41 of the 51 participating community development loan funds (CDLFs), or 80 percent, have increased their small business lending. And a substantial majority of SBLF participants — more than 60 percent— have now increased their small business lending by 10 percent or more. In dollars, community bank participants increased their small business lending by $3.4 billion and CDLFs increased their small business lending by $86.8 million.

The report also shows that lending through the program is widely distributed across the country – banks and CDLFs in 44 states (including Washington, DC) reported increased lending. These increases have a huge impact in their communities where small businesses have more access to lending.

This Administration knows that small businesses play a critical role in the U.S. economy and are central to creating jobs and restoring our economic prosperity. This report on SBLF is encouraging, and we look forward to even stronger reports in the future.

Banks and CDLFs that increased their small business lending as of 9/30/11

Name City State % Change over Baseline
BancIndependent, Incorporated Sheffield AL 11.0%
ServisFirst Bancshares, Inc. Birmingham AL 36.2%
SouthCity Bank Vestavia Hills AL 20.9%
Southern National Corporation Andalusia AL 13.5%
Southern States Bancshares, Inc. Anniston AL 49.8%
Rock Bancshares, Inc. Little Rock AR 45.1%
Western Alliance Bancorporation Phoenix AZ 1.1%
1st Enterprise Bank Los Angeles CA 81.0%
Bank of Commerce Holdings Redding CA 6.4%
California Bank of Commerce Lafayette CA 61.6%
Capital Bank San Juan Capistrano CA 89.1%
Community Valley Bank El Centro CA 105.6%
Founders Bancorp San Luis Obispo CA 9.9%
GBC Holdings, Inc. Los Angeles CA 2.9%
OBDC Small Business Finance Oakland CA 86.5%
Opportunity Fund Northern California San Jose CA 20.8%
Partners Bank of California Mission Viejo CA 21.7%
Promerica Bank Los Angeles CA 40.9%
Redwood Capital Bancorp Eureka CA 14.5%
Rural Community Assistance Corporation West Sacramento CA 18.8%
Seacoast Commerce Bank Chula Vista CA 12.4%
Security Business Bancorp San Diego CA 28.8%
Security California Bancorp Riverside CA 20.9%
The Bank of Santa Barbara Santa Barbara CA 85.2%
The Private Bank of California Los Angeles CA 65.2%
Valley Economic Development Center, Inc. Van Nuys CA 64.1%
CIC Bancshares, Inc. Greenwood Village CO 432.6%
Colorado Enterprise Fund, Inc. Denver CO 29.1%
Columbine Capital Corp. Buena Vista CO 55.6%
Morgan Capital Corporation Fort Morgan CO 30.7%
Steele Street Bank Corporation Denver CO 27.1%
Verus Acquisition Group, Inc. Fort Collins CO 40.2%
BNC Financial Group, Inc. New Canaan CT 203.3%
Greater New Haven Community Loan Fund New Haven CT 3.7%
Salisbury Bancorp, Inc. Lakeville CT 14.7%
SBT Bancorp, Inc. Simsbury CT 14.7%
Partners for the Common Good, Inc. Washington DC 10.6%
Community Bank Delaware Lewes DE 18.6%
Bank of Central Florida Lakeland FL 22.2%
Broward Financial Holdings, Inc. Fort Lauderdale FL 72.0%
Community Southern Bank Lakeland FL 40.9%
FineMark Holdings, Inc. Fort Myers FL 75.2%
First Green Bank Eustis FL 109.2%
Florida Business BancGroup, Inc. Tampa FL 16.5%
Florida Shores Bancorp, Inc. Pompano Beach FL 21.4%
Florida Traditions Bank Dade City FL 71.7%
Jefferson Bank of Florida Oldsmar FL 59.0%
Marquis Bank Coral Gables FL 131.9%
Ovation Holdings, Inc. Naples FL 10.3%
Appalachian Community Enterprises, Inc. Cleveland GA 39.3%
Lowndes Bancshares, Inc. Valdosta GA 21.9%
Resurgens Bancorp Atlanta GA 57.5%
The Peoples Bank of Talbotton Talbotton GA 13.3%
Commercial Financial Corp Storm Lake IA 1.5%
Heartland Financial USA, Inc. Dubuque IA 0.8%
Liberty Financial Services, Inc. Sioux City IA 18.6%
Two Rivers Financial Group, Inc. Burlington IA 13.5%
Bancorp Financial, Inc. Oak Brook IL 6.6%
Community First Bancorp, Inc. Fairview Heights IL 20.6%
Community Illinois Corporation Rock Falls IL 10.6%
First Bankers Trustshares, Inc. Quincy IL 22.9%
First Community Financial Corporation Elgin IL 10.3%
First Eldorado Bancshares, Inc. Eldorado IL 5.6%
First Robinson Financial Corporation Robinson IL 30.5%
Heartland Bancorp, Inc. Bloomington IL 2.5%
IFF Chicago IL 12.4%
Illinois State Bancorp, Inc. Chicago IL 4.3%
Merchants and Manufacturers Bank Corporation Joliet IL 11.5%
People First Bancshares, Inc. Pana IL 12.4%
Prime Banc Corp. Dieterich IL 8.5%
Signature Bancorporation, Inc. Chicago IL 13.8%
Southern Illinois Bancorp, Inc. Carmi IL 18.5%
Town and Country Financial Corporation Springfield IL 5.4%
Tri-County Financial Group, Inc. Mendota IL 11.7%
United Community Bancorp, Inc. Chatham IL 9.1%
AMB Financial Corp. Munster IN 1.8%
Community Bank Shares of Indiana, Inc. New Albany IN 9.0%
First Savings Financial Group, Inc. Clarksville IN 51.5%
Horizon Bancorp Michigan City IN 6.5%
Bern Bancshares, Inc. Bern KS 5.9%
CB Bancshares Corp. Weir KS 36.8%
Equity Bancshares, Inc. Wichita KS 12.4%
Farmers State Bankshares, Inc. Holton KS 2.5%
First Financial Bancshares, Inc. Lawrence KS 4.0%
Freedom Bancshares, Inc. Overland Park KS 13.4%
Osborne Investments, Inc. Osborne KS 50.2%
UBT Bancshares, Inc. Marysville KS 20.4%
Community Ventures Corporation Lexington KY 23.1%
Federation of Appalachian Housing Enterprises, Inc. Berea KY 116.8%
Magnolia Bancshares Inc. Hodgenville KY 2.6%
Community Trust Financial Corporation Ruston LA 36.1%
First Guaranty Bancshares, Inc. Hammond LA 0.5%
First NBC Bank Holding Company New Orleans LA 16.8%
MidSouth Bancorp, Inc. LaFayette LA 0.2%
Ouachita Bancshares Corp. Monroe LA 7.0%
Boston Community Loan Fund, Inc. Roxbury MA 77.7%
Capital Link, Inc. Boston MA 79.6%
Hyde Park Bancorp, Inc. Hyde Park MA 189.1%
Island Bancorp, Inc. Edgartown MA 32.7%
Leader Bancorp, Inc. Arlington MA 26.7%
Mercantile Capital Corporation Boston MA 24.5%
New England Bancorp, Inc. Hyannis MA 38.7%
Provident Bancorp, Inc. Amesbury MA 15.9%
StonehamBank, A Co-operative Bank Stoneham MA 46.8%
Eagle Bancorp, Inc. Bethesda MD 40.4%
Enterprise Community Loan Fund, Inc. Columbia MD 42.0%
Monument Bank Bethesda MD 26.6%
Tri-County Financial Corporation Waldorf MD 14.0%
Katahdin Bankshares Corp. Houlton ME 12.8%
Birmingham Bloomfield Bancshares, Inc. Birmingham MI 14.6%
Crestmark Bancorp, Inc. Troy MI 61.0%
Huron Valley State Bank Milford MI 32.0%
Level One Bancorp, Inc. Farmington Hills MI 31.6%
Valley Financial Group, Ltd. Saginaw MI 18.5%
Financial Services of Winger, Inc. Fosston MN 16.3%
Kerkhoven Bancshares, Inc Kerkhoven MN 11.7%
MidWest Bancorporation, Inc. Eden Prairie MN 14.0%
Midwest Minnesota Community Development Corporation Detroit Lakes MN 60.5%
Nonprofits Assistance Fund Minneapolis MN 21.7%
Platinum Bancorp, Inc. Oakdale MN 7.4%
Redwood Financial, Inc. Redwood Falls MN 6.5%
Cardinal Bancorp II, Inc. Washington MO 10.6%
Great Southern Bancorp, Inc. Springfield MO 38.7%
Liberty Bancorp, Inc. Liberty MO 0.1%
Security State Bancshares, Inc. Charleston MO 15.8%
Southern Missouri Bancorp, Inc. Poplar Bluff MO 16.2%
Triad Bancorp, Inc. Frontenac MO 28.8%
Bancorp of Montana Holding Company Missoula MT 50.3%
Montana Community Development Corporation Missoula MT 17.9%
Citizens South Banking Corporation Gastonia NC 9.2%
First Bancorp Troy NC 2.7%
Live Oak Bancshares, Inc. Wilmington NC 84.2%
Mountain BizCapital, Inc. Asheville NC 13.8%
Providence Bank Rocky Mount NC 20.7%
Select Bancorp, Inc. Greenville NC 50.3%
Union Bank & Trust Company Oxford NC 16.3%
Alerus Financial Corporation Grand Forks ND 15.1%
Western State Agency, Inc. Devils Lake ND 16.1%
Adbanc, Inc. Ogallala NE 8.4%
Banner County Ban Corporation Harrisburg NE 26.1%
Nebraska Enterprise Fund Oakland NE 95.3%
The State Bank of Bartley Bartley NE 1.7%
Wilber Co. Lincoln NE 10.0%
Centrix Bank & Trust Bedford NH 17.3%
First Colebrook Bancorp, Inc. Colebrook NH 5.1%
New Hampshire Thrift Bancshares, Inc. Newport NH 1.0%
Northway Financial, Inc. Berlin NH 15.1%
The Nashua Bank Nashua NH 31.9%
Freedom Bank Oradell NJ 42.5%
Harmony Bank Jackson Township NJ 138.3%
Highlands Bancorp, Inc. Vernon NJ 51.3%
Hopewell Valley Community Bank Pennington NJ 13.2%
Regal Bank Livingston NJ 32.2%
Stewardship Financial Corporation Midland Park NJ 9.9%
Meadows Bank Las Vegas NV 80.3%
Alma Bank Astoria NY 156.2%
Catskill Hudson Bancorp, Inc. Rock Hill NY 22.0%
Community Loan Fund of the Capital Region, Inc. Albany NY 6.7%
Greater Rochester Bancorp, Inc. Rochester NY 29.2%
Kinderhook Bank Corp. Kinderhook NY 18.6%
La Fuerza Unida Community Development Corporation East Norwich NY 311.6%
Leviticus 25:23 Alternative Fund, Inc. Elmsford NY 28.9%
Pathfinder Bancorp, Inc. Oswego NY 7.3%
Seedco Financial Services, Inc. New York NY 25.9%
Seneca-Cayuga Bancorp, Inc. Seneca Falls NY 78.4%
The Elmira Savings Bank, FSB Elmira NY 3.6%
Columbus First Bancorp, Inc Worthington OH 26.3%
Community Independent Bancorp Inc. West Salem OH 19.5%
Economic and Community Development Institute, Inc. Columbus OH 73.5%
Insight Bank Columbus OH 76.9%
AmeriBank Holding Company Collinsville OK 14.2%
Central Service Corporation Enid OK 5.4%
Citizen Potawatomi Community Development Corporation Shawnee OK 34.2%
F & M Bancorporation, Inc. Tulsa OK 21.3%
Prime Bank Group Edmond OK 80.1%
Regent Capital Corporation Nowata OK 10.7%
CBT Financial Corp. Clearfield PA 30.9%
Centric Financial Corporation Harrisburg PA 17.1%
Codorus Valley Bancorp, Inc. York PA 9.8%
Community First Fund Lancaster PA 9.0%
DNB Financial Corporation Downingtown PA 7.2%
Enterprise Financial Services Group, Inc. Allison Park PA 5.7%
First Resource Bank Exton PA 0.8%
Jonestown Bank and Trust Company Jonestown PA 19.2%
MileStone Bank Doylestown PA 38.7%
Monument Bank Doylestown PA 85.1%
Northside Community Development Fund Pittsburgh PA 19.0%
Penn Liberty Financial Corp. Wayne PA 15.7%
Phoenix Bancorp, Inc. Minersville PA 22.3%
Team Capital Bank Bethlehem PA 22.5%
The Progress Fund Greensburg PA 26.9%
The Victory Bancorp, Inc. Limerick PA 79.3%
Valley Green Bank Philadelphia PA 110.0%
Carolina Alliance Bank Spartanburg SC 24.2%
Charleston Citywide Local Development Corporation Charleston SC 70.0%
GrandSouth Bancorporation Greenville SC 17.4%
Lowcountry Housing Trust, Incorporated North Charleston SC 18.8%
TCB Corporation Greenwood SC 2.7%
BHCB Holding Company Rapid City SD 40.2%
Northeast South Dakota Economic Corporation Sisseton SD 13.0%
South Eastern Development Foundation Sioux Falls SD 36.6%
Avenue Financial Holdings, Inc. Nashville TN 36.6%
CapitalMark Bank & Trust Chattanooga TN 15.0%
Carroll Financial Services, Inc. Huntingdon TN 17.0%
Evolve Bancorp, Inc. Cordova TN 108.9%
Franklin Financial Network, Inc. Franklin TN 14.0%
InsCorp, Inc. Nashville TN 28.2%
Landmark Community Bank Collierville TN 55.0%
Magna Bank Memphis TN 34.2%
Merchants & Planters Bancshares, Inc. Bolivar TN 60.2%
Planters Financial Group, Inc. Clarksville TN 18.7%
SmartFinancial, Inc. Pigeon Forge TN 85.5%
Southern Heritage Bancshares, Inc. Cleveland TN 17.9%
Sumner Bank & Trust Gallatin TN 0.7%
AIM Bancshares, Inc. Levelland TX 54.4%
BMC Bancshares, Inc. Dallas TX 11.1%
BOH Holdings, Inc. Houston TX 34.2%
CEN-TEX Certified Development Corporation Austin TX 7.0%
Encore Bancshares, Inc. Houston TX 20.8%
FB BanCorp San Antonio TX 11.1%
First Texas BHC, Inc. Fort Worth TX 26.2%
Frontier Bancshares, Inc. Austin TX 47.3%
FVNB Corp. Victoria TX 5.8%
Happy Bancshares, Inc. Amarillo TX 35.0%
Joaquin Bankshares Inc. Huntington TX 10.6%
Liberty Capital Bancshares, Inc. Addison TX 74.5%
McLaughlin Bancshares, Inc. Ralls TX 38.9%
PeopleFund Austin TX 18.6%
Pioneer Bank, SSB Drippings Springs TX 31.8%
PlainsCapital Corporation Dallas TX 6.8%
Southwestern Bancorp, Inc. Boerne TX 10.4%
Third Coast Bank SSB Humble TX 82.0%
Veritex Holdings, Inc. Dallas TX 36.1%
Cache Valley Banking Company Logan UT 27.8%
LCA Bank Corporation Park City UT 1457.1%
Medallion Bank Salt Lake City UT 45.6%
Citizens Community Bank South Hill VA 1.3%
ECDC Enterprise Development Group Arlington VA 27.0%
Heritage Bankshares, Inc. Norfolk VA 9.5%
NCB Capital Impact Arlington VA 15.2%
TowneBank Suffolk VA 5.1%
United Financial Banking Companies, Inc. Vienna VA 10.0%
Virginia Heritage Bank Fairfax VA 36.0%
WashingtonFirst Bankshares, Inc. Reston VA 41.1%
Xenith Bankshares, Inc. Richmond VA 58.4%
Vermont Community Loan Fund, Inc. Montpelier VT 18.1%
Peoples Bancorp Lynden / Bellingham WA 4.3%
Puget Sound Bank Bellevue WA 31.7%
ShoreBank Enterprise Group, Pacific Ilwaco WA 16.5%
U&I Financial Corp Lynnwood WA 34.7%
County Bancorp, Inc. Manitowoc WI 11.6%
Deerfield Financial Corporation Deerfield WI 11.9%
First American Investment, Inc. Hudson WI 15.9%
First Menasha Bancshares, Inc. Neenah WI 5.7%
Forward Community Investments, Inc. Madison WI 40.9%
Impact Seven, Incorporated Almena WI 1.4%
Wisconsin Women’s Business Initiative Corporation Milwaukee WI 28.0%
MVB Financial Corp. Fairmont WV 27.5%
Financial Security Corporation Basin WY 25.7%


For more information on the SBLF, click here.  To read the full “Use of Funds” report, click here.

Don Graves is Deputy Assistant Secretary for Small Business, Community Development and Housing Policy

Posted in: Small Business, Small Business Lending Fund (SBLF)

Ready, Set…. Launch!

Is your tech-based product or service ready to launch? Want to be sure? Then join us for “Ready, Set, Launch”a workshop designed to help technology entrepreneurs assess the progress they’ve made inturning an innovation into a viable commercial venture.

This workshop is sponsored by TechEDge, a program started by the City of Chandler and the Maricopa Small Business Development Center (SBDC) to assist entrepreneurs in the greater Phoenix area.

By attending “Ready, Set, Launch,”you’ll learn about ways to determine your venture’s readiness in three key areas:

Technology: How unique is your innovation? How strong is the competition? What will it take to get your innovation produced on a commercial scale?

Market Awareness: Who is your competition? Who are your potential partners? What are the barriers and opportunities to success in the marketplace?

Business Readiness: What infrastructure do you need to have in place before launching and running a tech-centric business? Who will you need on your team? Where can you go for help?

Details are as follows:

  • Tuesday, February 7, 2012
  • Time:   8:30am – 11:30am
  • Location: Innovations Technology Incubator, 145 S. 79th St., Chandler, AZ (Chandler Boulevard and McClintock Drive)
  • Cost:  Free to the first 15 who sign-up
  • Registration:  Contact the Maricopa Small Business Development Center at 480-784-0590 or register online at
  • Free for SBDC clients


Arizona Creates New Statewide Incubator Organization

We attended the inaugoral meeting of the Arizona Incubation Association, Inc. on Thursday morning in Phoenix.  The group started by passing bylaws and electing officers.  The President is Russ Yelton of the NACET Incubator in Flagstaff, who is also involved with the new Incubator in Phoenix at Gateway Community College.  Vice President is Christine MacKay, Economic Developer for the City of Chandler, who heads up the Innovations Incubator there.  The organizations purpose is to become a professional association to serve our states small business incubators, and provide a means of support and promote incubation statewide.  The Association has a website which is a good information source for the incubators currently involved.  To be added to that website contact Stacey at  They also have a resources sharing site which will facilitate sharing of resources, organizations and ideas.   A good start for an important project for the future of Arizona small business.

We presented information on the TechEDge curriculum that was developed by the Maricopa SBDC for the City of Chandler Innovations, and Christine shared that the City was pleased to extend that program to other incubators that wish to do classes.  For more information refer to or

SBA Updates Survey of State Data

The economic condition of small businesses in the United States is captured in the latest edition of the  Small Business Profiles for the States and Territories. This annual publication from the Office of Advocacy provides information on the demographics of business ownership, employment, industry composition, and small business income, for each of the 50 states and the District of Columbia. The publication provides available limited data on the U.S. territories.

The latest issue can be found online at and shows Arizona data for 2009.  The changes from prior year are interesting.  While small business employers with 500 or less employees decreased 5.5% (101,228), and small business empoyers with 500 or more employees decreased 7.9% (2,963); the self employed category only decreased .5% (one-half of one percent) (379,818).  Even during the heart of the worst recession in the last 50 years the self-employed sector stayed strong for Arizona.  No doubt alot of out of work professionals turned their skills into a business, and created a job in the process.

S.B.A. Readying Program to Invest in Start-Ups

The Agenda

How small-business issues are shaping politics and policy.

With its legislative agenda for job creation stuck for the foreseeable future, the Obama administration has turned inward, looking to the federal bureaucracy for new ways to jump-start the economy.

Lately its gaze has settled on the Small Business Administration. Yes, it has proposed merging the S.B.A. into a much bigger government agency dedicated to business and trade. But an arguably more consequential decision came in December, when the S.B.A. unveiled a new $1 billion program to invest in young companies by loaning money to venture capital funds. Unlike the reorganization, which faces long odds in coming to pass, the new investment program, part of the administration’s Startup America campaign, is likely to commence this spring. But what remains unclear is whether it can win over the venture capital industry that it is meant to assist.

The new program would allow venture funds licensed by the S.B.A., known as small-business investment companies, to borrow money from the agency to augment the capital they have raised from private investors. A successful fund that borrows money generates higher returns for investors when it sells those stakes, since the lenders don’t share in the profits. Companies seeking financing would not contact the S.B.A. directly, but instead — as with any venture financing — would approach the small-business investment company, which would judge prospects on the strength of their business plan and management.


The new effort, christened the Early Stage Innovation Fund, fills a gap in the S.B.A.’s menu of assistance. For all of the different kinds of financing a small company can obtain from the S.B.A., the agency has not had a way to nurture fast-growing start-ups since 2004. That earlier program, which allowed small-business investment companies to essentially sell equity stakes in their portfolio companies to the agency, collapsed with big losses in the wake of the tech bubble a decade ago. The program’s complex terms, set by Congress, ensured its failure, said Brett Palmer, president of the Small Business Investor Alliance, a trade association for the investment companies. When a fund went belly-up, the government’s claim took priority for recovering assets, alienating other investors. However, the government saw very little of the profits on successful investments.

“The taxpayer had too much downside risk and not enough upside risk,” said Mr. Palmer. “It was overly complicated so nobody really understood how it worked, candidly. It still has people baffled.”

The new fund is more straightforward, and is an in fact a variation on another, much more successful, S.B.A. program, in which the investment companies loan the money they’ve borrowed from the S.B.A. to their portfolio companies. But investment companies can seldom reach the youngest start-ups, because these businesses often lack the cash flow required to make the quarterly interest payments, so the agency has tweaked the rules for the Early Stage Innovation Fund to make it easier for venture funds to use debt to buy equity.

The S.B.A. plans to use the Innovation Fund to channel investment into growth companies normally overlooked by venture capital funds. It turns out there is a gap in the venture economy that mirrors the agency’s own: venture funds typically invest in more established companies. In the first nine months of 2011, they reported directing just $727 million to companies in the so-called “seed” or conceptual stage, or 3 percent of the total $21 billion invested in the period, according to the National Venture Capital Association. Early-stage companies, usually those still testing a product or service, received $6 billion, just over a quarter of the total. At least half of the investments venture funds participating in this program make must be in companies without positive cash flow from operations.

Moreover, nearly three-quarters of venture financings go to companies in just three states: California, Massachusetts and New York, said Sean Greene, the S.B.A.’s associate administrator for investment and special adviser for innovation “There are places all over the country — Raleigh-Durham, Minneapolis, Austin — where there already is a big innovation ecosystem and there are already funds that are investing in those ecosystems,” Mr. Greene said. “But those firms are facing great challenges raising capital right now.” The new fund “will have a significant impact on the seed investment activity in the other 47 states.”

Mr. Greene said the S.B.A. had taken steps to minimize taxpayer risk in the new fund. Leverage is limited to the amount of private capital a fund has raised, up to $50 million. (In the regular S.B.I.C. program, the limit is three times the investment capital, up to $150 million.) A fund must also raise at least $20 million privately. In effect, then, only between four and 10 funds can participate in any year.

But Mr. Palmer said that could create other problems. “It’s a question of whether this innovation fund is too small to gather enough attention from the players who would invest in such a fund,” he said. “The limited partner community is very cautious — they really want to do a deep dive before they put their money into any investment class. Is it worth limited partners’ time to learn about the new product for which there may only be four or five funds, and of which they’d only be a fraction of each?”

Clay Thorp, of Hatteras Venture Partners in Durham, N.C., said that the poor track record of the S.B.A.’s earlier program could make investors wary of the new one. But, he added, “the changes they’ve made answer a lot of problems from the prior program. I think there really needs to be an education program for the limited-partner community and others about why this program is better. And the S.B.A. is doing that.”

One concern that remains, Mr. Thorp said, is that the new program, like the old, is “a debt structure underneath an equity fund” — an inherent mismatch, since interest and debt payments are predictable while an equity investment is anything but. “The perfect policy would have been an equity program where the S.B.A. would be a limited partner in the S.B.I.C. fund.” But Mr. Thorpe acknowledged there is little appetite in Washington for something so ambitious — and risky. “Within the constraints that they have, they’ve done the very best that they can.”

That, he added, may be good enough for his own fund. “The way they’ve modified the program makes it much more attractive to early-stage venture capital groups like Hatteras, and we’ll continue to evaluate whether this might be a program for us,” he said.

Mr. Greene said that the S.B.A. hoped to solicit applications from investment companies in April and issue its first licenses by the end of September.