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Mike Cote's Business Notebook: Tapping universities to empower business

By MIKE COTE
February 28. 2015 5:57PM
Alex Crate, lead operator in the Hypertherm manufacturing plant in Hanover, talks about the plant. The Hanover company received a grant in 2009 from the New Hampshire Innovation Research Center, which provides matching funds to pair businesses with research universities. (UNION LEADER FILE)

JOHN SHAW says he's not a big fan of economic development programs directed by state government. But he makes an exception for the one that helped him grow his Stratham company by tapping the research prowess at New Hampshire's universities.

Itaconix, whose products include a water-soluble polymer developed for use in detergents, will be among the companies meeting with legislators on Tuesday at Saint Paul's Church in Concord to tout the work of the New Hampshire Innovation Research Center.

Since it was established by the Legislature in 1991, the NHIRC has awarded more than $6 million in state funds to support research through matching funds for business development projects. Awardees have gone on to secure more than $32 million in federal Small Business Innovation Research grants and more than $900 million worth of investment and acquisition capital, according to program administrators, who credit the program for the creation or retention of 650 jobs.

Some of the companies that have been awarded funds were based on work spun out of a university. Itaconix cofounder Yvon Durant was a research professor in materials science at the University of New Hampshire when he helped start the company.

Shaw, the company's CEO, says the program provides an incentive for research that has commercial potential.

"It's not a government panel deciding what's interesting," Shaw said. "It's industry deciding what is commercially valuable, getting some assistance on basic innovative research through the universities."

Itaconix has not received funding from the program for a few years, but leveraging research dollars was important for the company in the initial stages, he said.

"The original concept validation and development was done under NHIRC. Out of that we have launched at least two products based on initial work that was done under an NHIRC grant," he said.

Some of the research was to develop a process to scale up technology for commercial use. Itaconix is benefiting from that work now. Its water-soluble polymer, which is nontoxic and safe for the environment, is widely used in consumer detergents in North America and Europe, and it's preparing to launch a product based on a latex polymer.

"When we got our first NHIRC grant we were a two-person company. Now we're 15 to 16 people," Shaw said.

The program is managed by UNHInnovation in Durham, but research partners have been tapped from other universities in the state, including Dartmouth College and Keene State College. The program requires companies to match the grant through cash or in-kind services such as employee hours or equipment.

"Even if I only have to put up half of the money for an idea, I'm still putting up money, so I'm not going to fund a bad idea," Shaw said.

The state currently devotes $300,000 to the program. Before it took a hit due to state budget cuts five years ago, $400,000 to $500,000 was earmarked for the program annually. Four to five companies get funding from the program each year, receiving $25,000 to $75,000 each. Funds are awarded twice a year, chosen by an oversight committee that includes legislators, government officials, academics and business leaders.

While the New Hampshire Innovation Research Center will mark its 25th anniversary next year, program coordinator Tim Willis said he considers it his mission to make more companies aware it exists. That said, current funding does not provide enough money to satisfy demand.

In the most recent round, 12 companies completed final submissions. Only two received awards, of $50,000 each.

"There were definitely a handful that could have received awards if funding were available," Willis said.

Companies that have received grants over the years include Turbocam Inc. (2000), Warwick Mills (2006), Nanocomp Technologies (2007), Hypertherm Inc. (2009) and Lamprey Networks (2015). Representatives from 10 companies that have received funding will be on hand for NHIRC Day on Tuesday, a luncheon from 11:45 a.m. to 1 p.m. at Saint Paul's Church, 21 Center St. in Concord. (RSVP to nhirc.info@unh.edu.)

"The goal is to highlight the good this program does for the state," Willis said. "It's the only program of its kind in New Hampshire."

Willis noted that the program is considerably modest compared to neighboring states. The Maine Technology Fund, for example, plans to award $3.3 million in its latest funding round when it announces winning submissions in April. The fund is fueled by a $50 million bond approved by the state and voters in 2007 plus $3 million authorized by the Maine legislature in 2009.

Shaw, who lobbied for funds to be restored after the NHIRC budget was cut 60 percent in 2010, would like to see the New Hampshire program more than doubled.

"I think somewhere more around a million would be great," Shaw said. "That would allow more professors at the university to get more grant money, and with that you see a lot of relationships between the university and industry."

Mike Cote is business editor. Contact him at 668-4321 ext. 324 or mcote@unionleader.com.



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