Ka Wai Ola - Office of Hawaiian Affairs, Volume 28, Number 11, 1 November 2011 — Capitalizing on innovative ideas [ARTICLE+ILLUSTRATION]

Capitalizing on innovative ideas

By Mary Aliee Milham What's the Big Idea? That's the $13 million question the Hawai'i Strategic Development Corp. wants to help Hawai'i answer. "For the State of Hawai'i, we think our eeonomie growth prospects will be enhanced if we ean focus on our knowledge-based technology development here as a means of diversifying our economy," says HSDC President Karl Fooks. In May, HSDC received $13.2 million through the State Small Business Credit Initiative. Part of the Small Business Jobs Act of 2010, the initiative was created to strengthen programs that support small businesses and small manufacturers. HSDC designed its SSBCI program, the Hawai'i Venture Capital Investment Program's "fund of funds," to foster knowledge-based enterprises in the areas of technology, life science, health and energy - by using the $13.2 million as "seed-stage capital" to invest in Hawai'i-based venture capital funds that ean, in turn, attract the larger investment funds needed to expand to nahonal and global markets. "What we thought we'd do with our capital was to support companies that would then naturally heeome of interest to these larger funds and in that way help develop the ecosystem for venture capital here in Hawai'i," says Fooks. But time is of the essence. A two-year window for funding will close in May 20 13, after whieh time any undistributed funds will revert back to the federal government. With few Hawai'i-based fund managers and fund investors, matching Hawai'i's entrepreneurs with larger venture capital funds in time to take advantage of the program is a challenge. With that in mind, HSDC hosted the 201 1 Hawai'i

Venture Capital Summit on Oct. 4 with institutional investors Kamehameha Schools and the State of Hawai'i Employees' Retirement System, whose Hawai'i-targeted investment programs represent an

additional $45 million and $25 million, respectively. The summit included a postconference networking event where entrepreneurs and venture capital fund managers could mix, mingle and "have a ehanee to develop contacts and relationships." HSDC also hosted a venture capital "pitch competition" in

March matching entrepreneurs with mentors to compete in presenting investment opportunities to investors. Fooks recommends that those interested in joining the "innovation economy" be on the lookout for and get involved in such events. "We ean help you think through that process and connect you up with the resources that could get your company launched and figure out a way to attract investment capital to it," says Fooks. "There's no reason to think that just because you're in Hawai'i and not in Silicon Valley, you can't build a business. We believe that you ean, and we'll help and support you." ■ Mary Aliee Kaiulani Miīham, a Portland, Oregonbased freelance journalist, is a former newspaper reporter and columnist from California's Central Coast.

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