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Genesis of Innovation for South Dakota Newsletters — October 2003 Helping Entrepreneurs through business development, startup capital, and other assistance.

Greetings

At the August 5th Genesis of Innovation Board meeting, the following Officers and Directors were nominated and approved for 2003-2004: Mike Derby, President-Executive Committee; Mel Ustad, Vice President- Executive Committee; Randy Morris, Treasurer-Executive Committee; Bob DeMersseman, Executive Committee; Paul Gnirk, Executive Committee; Jim Barringer; Peter Cappa; Marcia Hendrickson; Richard Naser, Jr., Dr. Tad Perry; Richard Rylance; Greg Von Wald; Dennis Anderson, Ex-Officio-Executive Committee; Gary Archamboult, Ex-Officio; Joel Dykstra, Ex-Officio; Julie Gregg, Ex-Officio; Greg Bartron, Coordinator-Executive Committee; Jody Severson; and Bill Griffin.

We are busy with the Genesis projects and exciting things are happening:

* We have worked very closely with the Legislative Research Council (LRC) to develop a Position Paper concerning the issues of Venture Capital (VC) and Intellectual Property (IP) for consideration by our legislators. In fact, the Genesis of Innovation (GOI) Board submitted a written report to the LRC suggesting that the process of perfecting IP rights is more flawed than the actual policy itself. However, the LRC has yet to provide a public release of their position paper and we look forward to the impact it may have on the administration and legislators.

* Representative Joel Dykstra of Canton, a GOI Board member, has developed a bill he intends to submit to the legislature next year which would basically allow the REDI Fund Board to award loans to qualified South Dakota Venture Capital companies who will invest at least 80% of their funds in South Dakota startups. Total loans under the act may not exceed 20 million and no more than 5 million in any given year – with repayment over 5 years at 115% or 7 years at 125%. However, the Board may negotiate for partial repayment of the loan or may forgive any outstanding balance of the loan.

* GOI Board member Tad Perry reports the Board of Regents is also requesting that the legislature appropriate approximately 7 million dollars toward higher teacher salaries, more technology and the hiring of research professors and graduate students.

* Some GOI Board members will be assisting the School of Mines in meetings on October 30th and 31st concerning how the campus can create business spin-offs, with topics such as: technology transfer, patent processes, available incubator facilities, marketing, accounting and other areas critical to starting new businesses.

* GOI Board members will be making Campus Tours at USD, SDSU and DSU and will also present to the BizTech Summit in Sioux Falls November 19th and 20th, 2003.

* Newly elected Board member Bill Griffin is busy developing databases of consultants and ex-executives willing to assist startups in the Black Hills. When completed, the databases will be published on the GOI website.

* GOI will host a “Power of Angel Investing” private workshop for Angel Investors in Rapid City in mid-May, in conjunction with the Kauffman Foundation. More information will be available shortly.

The Genesis Equity Fund (GEF) is doing very well with four (4) investments thus far:

1. The fund has invested in a Rapid City company producing digital phase converters and power conditioners which convert phase 1 power to phase 3 power. Great for many rural settings with international sales.

2. The Fund has invested in a North Sioux City, SD company involved in the sale of seafood pasta sauce currently being sold through major food chains across the country.

3. GEF has also invested in a Sioux Falls based firm involved in the development and application of a deep search engine that does multiple searches throughout every website it reviews. The process eliminates duplication and provides up to the minute data to users who are primarily corporations and government agencies.

4. Recently the Fund has invested in a Rapid City company developing embedded sensors that record body movements on all plains in a wireless environment. The data collected can then be reproduced to train military crew members in proper positioning techniques to mitigate shock damage to their bodies. This company has completed a conceptual prototype of a human motion analysis system with funds provided by U.S. Special Operations Command under the Federal SBIR program.

GEF still has investment capital and is looking for projects.

One final note…

All of you should be commended for the work you have done in helping to shape our future; it took the efforts of many people to influence the Governor’s 2010 initiative, which, as a main tenet, contains the goal of having South Dakota become a recognized leader in Research and Technology Development. You are all to be congratulated!

http://www.genesisofinnovation.org/news/oct2003.htm

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