Michigan’s 21st Century Jobs Fund

Competition is in full swing. This is the first year it is (mostly) well designed to make a difference to Michigan. Kudos for the folks that resisted the pressure to make this identical to the MTTC/MLSC of prior years. You can still see echos of that pressure, but I expect this to be a very exciting year with interesting proposals that will have a net positive benefit for Michigan if some are funded.

We are in the mix with 2 HPC specific proposals. One targetted at cost effective high performance life science and related computing (really, it will handle any number of applications which share common algorithmic features, and we are not talking (just) integer based), another targetted at lowering the cost of high performance computing for end users of all sizes and of all fields.

We have been speaking to VC’s for the past 3 years about the first project, we are going to have to secure funds. My hope is that the recent market size and growth rate news may have intrigued them. This is a great market, and a good company with the right idea at the right time (now), can make a huge impact in short order. All we need is to speak with the right investor groups with the right backgrounds. For the second project, it is going to be challenging, as we will need to build some interesting new concepts to make it work properly. But I am convinced we can do it. The models work.

Looking forward to reporting success in the future.


By the way, 791 letters of intent have been submitted. I am pretty sure they were not anticipating this. This is a good thing, and shows that if they manage this right, retain and continue this effort, and fund it in the way that CALPERS money effectively created Silicon Valley, that over a long enough sustained interval, they ought to have a similar affect. It needs to be managed carefully, handled delicately, and absolutely continued year after year in the same manner. The benefits to Michigan can be huge, but only if it continues and is sustainable.

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2 thoughts on “Michigan’s 21st Century Jobs Fund

  1. Update Have a look at these two followups, posts 83 and 82.

    What does the future hold for the 21st century or any followons? Who knows. One thing fairly for certain. After trying with some excellent proposals since 2002 to win a slot in one of the competitions, getting to final stages in some cases, and not being selected in every case, often with, well, a somewhat pathetic excuse for same, we are not likely to participate again.

    I want to stress that in the 2002/2003 cycle we presented a program that anticipated the web-based workflow efforts that have turned into a sizeable market in life science. The excuse that time was that the state did not want to be a VC.

    In 2004-2006 we presented our accelerator ideas. These ideas are now all the rage in HPC, and looks like they will fundamentally change HPC by offering significant performance augmentation at reasonable prices, if done properly. In 2004 we were dinged on formatting. Some page numbering was off. In 2005 we advanced to the final round, only to be told in the final decision that high performance computing for life science was not life science. 6 weeks later, Johns Hopkins invested 6 times the amount of money we requested in, you guessed it, high performance computing for life sciences. Others before and after that. It was fairly obvious that the comment given to us was not the real reason for the declination. At that stage the MEDC had invested something like 140M$ and had very few new high wage high value jobs or businesses to show in the state. We were highly discouraged after that process. In the 21st century process, we were told that high performance computing was a critical bit. We made the mistake of believing this. We committed huge efforts to submit 2 proposals, both with very realisitic foci, customers at the back end of the process, and limited funds requirements. As pointed out in the above linked summaries, the state declined to advance high performance computing in any way shape or form to the final interview rounds. Our 6M$ match was called *weak*. Our letters of committment, usually copied from a sample I provided were called weak as they were copied from the sample I provided.

    Paraphrasing Abba Eban, the state did not miss an opportunity to miss an opportunity. About 1/2 of the finalists are in the auto industry. This is the industry dealing with fundamental structural economic change. There is likely going to be a bankruptcy in the not too distant future of one of the big three. This is not the industry you want to be investing in now. You want to see cost containment, a realistic focus upon the market realities, such as a strong interest in high mpg vehicles, a high interest in safety. These are things that have not been at the forefront of the US automakers.

    Aside from this, the Michigan economy is tied to manufacturering. Manufactering seeks out the lowest cost suppliers of labor and materials. Michigan is not it for either, it would require breaking federal wage laws to be able to compete with the low cost providers.

    Michigan needs to adapt. It needs to diversify. It needs to focus on areas where it can make a difference and leverage its assets. Not manufacturing assets, but intangibles. Like lower cost of living relative to the coasts. Reasonably nice weather, nice geography, though no mountains. The state could be a great place to build a high tech company focused upon computing if only it could get capital into the hands of companies that want to build such things. But it cant. VCs here are focused upon medical instruments, and thats about it. Attracting out of state VCs here is hard, they all want you to move to the coasts. This is why processes like the 21st century could be so important if they worked. But they don’t.

    Folks, if you are considering the 21st century fund and its successors, don’t. A lottery ticket requires less work, and is about as likely to win. We will not waste our time with this again. We advise you not to either.

    The president of UMich asked at the meeting in 2005 where the award decisions were made why there were not more qualified companies submitting. Well, I suspect that there are several explanations, and I doubt they have to do with companies not submitting. Though in the future, you can likely count us out. It costs me too much money to waste on this process. I cannot afford it.

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