Tuesday, April 21, 2009

the stimulus package and the Valley

I was at a panel discussion hosted by Stanford's Venture Lab today called "The New Stimulus Package: What Does it Mean for the Valley?".

While a lot of it was plug by the panelists to promote their own organizations/businesses, and the rest too high level, there was some interesting information in there.

Quite a bit of money in the stimulus package is available to entrepreneurs, if they apply for grants. Obviously, their businesses must be able to justify these grants. The government is focusing on things like clean tech, energy efficiency, healthcare, infrastructure, etc. and so the money is allocated to these sectors. The numbers were from $500k to $20MM per grant.

The best part about these grants? They are anti-dilutory.

The amount of detail published (on recovery.gov, the stimulus package bill, etc.) by the government about the spending plan for the stimulus money is extremely impressive. It is available to everyone to comment, criticize and use. And people are doing it with a lot of interest.

The government itself is asking businesses and entrepreneurs to take initiative in this economic climate. See fbo.gov - Federal Business Opportunities.

Research institutions like the Lawrence Livermore Laboratories have a huge corpus of technologies unused for any commercial purpose that they are willing to let entrepreneurs use. Information about these is up on their websites, and anyone can partner with them to use their technology. Last year LLNL had 16 startups from existing technologies they had created but weren't using. And, they fund startups too.

The Fogarty Institute for Innovation does similar things around healthcare. They are part of the El Camino Hospital and are even helping a startup working on helping diabetics through social networking and an iPhone application prepare their grant application.

Movement of anything costs money. And government grants are not an exception. There are startups helping other startups get these government grants - they will do all your paperwork and grant applications for you, talk to legislators for you, etc. But a secondary economy was to be expected when sums of money amounting to nearly a trillion dollars are involved. It is not surprising how middle men are everywhere, and how quickly any vacuum is filled up.

Every sector has a detailed plan of how to spend their money. Except for education, which has $60 billion allocated. No one knows what to do with education!

There are some slides with exact numbers about the amounts of money involved and how it is all allocated and where the opportunities are. I'll link to them once they are up.

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