Austin Business Journal
Business News - Local News Friday, May 1, 2009

ETF must be fully replenished

Austin Business Journal - by Craig Casselberry, Tom Kowalski and Jeff Clark


We have all heard the bad news.

The National Venture Capital Association reports that investing in early stage businesses is down 71 percent over the last 12 months. Small business lines of credit are not being renewed by banks seeking to preserve liquidity. As credit is tightened, employers are forced to consider layoffs to stay in business.

The good news is that Texas is four years ahead of the curve. In 2005 the Texas Emerging Technology Fund was created to take ideas from our world-class research, create new companies with global impact, and accelerate the next generation technology economy in Texas.

ETF has become a national model. The fund has grown into the most active early stage investment fund in the country and today provides the foundation for innovation, transitioning ideas into the marketplace with management and private capital.

As the Texas Legislature considers our state’s long-term competitive position, the ETF program should be recognized as the foundation to position Texas as a leader in the global economy through new company formation, high-paying jobs, wealth creation and commercialization of our world- class research , and receive full funding to enhance and strengthen the program.

The program maintains a diverse portfolio of medical devices, energy, nanoelectronics, semiconductors, pharmaceuticals, biopharmaceuticals, IT, biotechnology, robotics, nanomedicine, defense, aerospace telecommunications and software.

Every ETF-funded company has a collaborative relationship with one or more Texas institutions of higher education. Since ETF’s creation, 45 world-class researchers and their teams have been recruited from around the world to 14 Texas public universities. Today, the fund’s investment of over $74 million to recruit those teams has resulted in an additional $139 million from private and federal sources into those institutions — and we’re still counting.

The program’s Regional Centers of Innovation and Commercialization provide the statewide infrastructure. Eight RCICs throughout the state represent the economic and technological diversity of their regions. Today over 500 seasoned experts volunteer their time to evaluate, coach, mentor and select quality investment opportunities. The fund has screened over 1,000 company proposals and invested in 79 early stage technology companies.

The success of the ETF would not have happened without the leadership and foresight of our elected leaders at all levels, the work of economic development officials across the state and the enduring entrepreneurial spirit that makes Texas great.

The lifeblood of sustained economic growth remains long-term access to capital for our entrepreneurs and emerging companies. Texas must maintain its competitive edge and send a clear message of its commitment to the next generation technology economy by fully funding the ETF program.


Craig Casselberry is president of the Texas Coalition for Capital.Tom Kowalski is president and CEO of the Texas Healthcare and Bioscience Institute. Jeff Clark is Texas director of TechAmerica (formerly AeA).

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