Innovations Examples from the US Innovation and Competition Act 

 Overview of USICA

The recently passed US Innovation and Competition Act (USICA) aims to build and maintain American leadership in emerging industries such as artificial intelligence and quantum computing. The combination of a direct challenge to our tech dominance from China with a progressive investment in sustainable jobs at home made for a widely popular piece of legislation. And, after quickly passing the Senate chambers with a vote of 68-32, USICA contains many promising initiatives. As a note, most of the promising sections of the bill are just that – promises. This is due to the distinction between authorization, where Congress begins or renews a federal program and sets limits on its funding, and appropriation, where Congress provides budget authority for a federal agency to procure program funding. Outside of some notable exceptions, like the 50.2 billion dollars appropriated to expand the American semiconductor industry, the bill only authorizes rather than appropriates funding for the promised programs.  

USICA centers around a list of 10 ‘key technology focus areas’ that the bill highlights as essential to American innovation. The first tech area covers artificial intelligence, machine learning, autonomy, and related advances. This area is featured in the bill’s Advancing American AI Act, which, among other things, calls for increased public transparency in all agency’s artificial intelligence projects and the identification of “four new use cases for the application of intelligence-enabled systems to support inter-agency or intra-agency modernization initiatives.” The second tech area includes semiconductors. The “Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Fund,” which appropriates the previously mentioned 50.2 billion dollars for semiconductor production, has been a headline goal of the bill since its inception by Senator Chuck Schumer. All 10 tech areas are covered later in this report.

The bill invests in American semiconductor production, expands funding for the National Science Foundation, and establishes a Directorate for Technology and Innovation at the NSF, all of which facilitate development in the 10 tech areas. It authorizes billions of dollars for innovation centers and regional technology hubs around the country, opening the door for new high-tech companies in nontraditional locations outside of California and the Northeast. 

People at universities and research institutions across the country are excited for America’s largest investment in innovation. Take technology transfer, an important component of American innovation. Tech transfer offices facilitate the commercialization of research by helping scientists at universities, academic hospitals, or private research labs turn discoveries into actual products and services.  In early June, representatives from 50 or so tech transfer offices tuned in to a virtual watercooler event held by AUTM on the Endless Frontier Act.  They lauded the bill, and the up to $1 million dollars available to universities for tech transfer activities, as an example of Congress recognizing and funding tech transfer. Speakers also talked about the significance of Section 2109, which includes the Academic Technology Transfer Enhancement Program and the Collaborative Innovation Resource Center Program. The Association of American Universities also supports USICA legislation. Tobin Smith, the Vice President for Science Policy & Global Affairs at the AAU, voiced specific concerns over amendments on increased intellectually property restrictions as well as Section 2303, which prohibits federal funding of foreign talent recruitment programs. However, he and the AAU believe that the benefits of USICA to academic research and American innovation outweigh the potential negatives.    According to recent research from Wharton, In terms of economic magnitude, a doubling of R&D expenditure, the number of full-time faculty, and TTO employees, is associated with patent value increases of 50%, 24%, and 37%, respectively, holding other variables fixed.

The Role of Innovation

Although the existing bill authorizes money for new initiatives and investments, it does not cover the nuts and bolts of how to allocate those funds. Implementation requires knowledge of the current landscape of American innovation. There are already thousands of American researchers, innovators and entrepreneurs working in the ten emerging technology sectors identified by USICA. They are based at universities, federal labs, academic hospitals, and startup accelerators across the country. SIBR-grants, partnerships with major research universities, and self-licensed IP’s all motivate entrepreneurs to develop the groundbreaking technology this legislation aims to promote. Newly founded high-growth tech startups are a finger on the pulse of American innovation. 

Equal Innovation, scouts innovative technologies, startups, research breakthroughs and promising small businesses across 4,500+ innovation, entrepreneurship, and accelerator programs worldwide, including over 3,500 in the United States. These include America’s leading research universities, economic development agencies, academic hospitals, and startup accelerators. This year, we will profile nearly 500 emerging startups in the United States that are working in one of the fields highlighted by USICA. Our report provides a meaningful snapshot of the startup ecosystem, yet there are still several thousand more new companies that we have not yet reached. 

Although our sample of profiles may not perfectly represent all domestic startups, we can still observe trends to determine how the 10 tech areas emphasized by the bill line up with the real world. Out of last year’s profiled startups, almost 80 companies fit under one or more of the 10 areas. Area #7, which includes biotechnology, medical technology, genomics, and synthetic biology, was by far the most populated category. The Quantum Information Science and Technology sector, Area #3, had the least startups, while advanced communications technology and immersive technology, Area #6, had the second least.  That could be changing, however, as the University of Chicago recently launched Duality, an entirely quantum focused accelerator. The first of its kind in the country, Duality is led by the Polsky Center for Entrepreneurship and Innovation and the Chicago Quantum Exchange. They just accepted six companies for its first class of startups, each of which receives $50,000 in funding and 12 months of mentorship. 

Examples of Relevant Startups

For each of the 10 tech areas, we highlight two exciting startups that Equal Innovation has profiled in the last year.

Tech Area #1 covers artificial intelligence, machine learning, autonomy, and related advances. The development of artificial intelligence is both an opportunity for domestic investments as well as a major arena of tech competition between the United States and China, as highlighted in the bill’s Advancing American AI Act.

• BlueConduit is a startup out of Ann Arbor, Michigan that uses machine learning to ensure clean water access. They first used their predictive modeling techniques in Flint, Michigan in 2016, when they helped respond to the clean water crisis by generating accurate estimates of which homes were likely to have lead service lines. The model was correct approximately 80% of the time, compared to an outside consulting firm hired by the city which found lead service lines on 15% of excavation attempts.  
• PostEra is a startup based in Boston, Massachusetts that uses AI and machine learning to improve the way drugs are marketed and manufactured. Originally part of the COVID Moonshot initiative, they have since converted ‘Manifold,’ their synthesis and search engine for chemical compounds, to use for general drug creation.   

Tech Area #2 covers high performance computing, semiconductors, and advanced computer hardware and software. The global semiconductor shortage was one of the motivating factors behind the entire bill and U.S. reliance on overseas semiconductor production remains a major concern.

• While they have yet to form a company, two researchers at MIT have developed a programmable lithography mask aimed at improving semiconductor production. The process of patterning nanostructures with a mask on a substrate (lithography), is an expensive part of semiconductor production that comes with a tradeoff between speed and resolution. This newly developed programmable mask allows for high speed and resolution while also reducing costs.
  
  
• Fractal is a New York City startup that is developing a cloud-powered internet browser. It could make high performance computing available for everyday use at the individual level. Some of their main features include 10 times less memory usage than Google Chrome and increased privacy and security. A Fractal-user’s IP address and location are hidden from websites and no browsing data is on the computer. 
• Amethyst Research Incorporated is a startup in Ardmore, Oklahoma has developed a range of semiconductor analytic tools. They also operate as a consulting service for semiconductor materials research, development, and processing needs.

Tech Area #3 includes quantum information science and technology. Quantum-related technology and science is a relatively new field full of promising applications. Potential applications include AI, Edge Computing, Blockchain, IoT, and Big Data Analytics. The market alone for this is estimated to be over a trillion dollars in the next decade. 

• QDIR is a startup out of Chicago, Illinois that uses colloidal quantum dots to develop infrared technology. Colloidal quantum dots have numerous applications in advanced manufacturing, including the production of infrared imagers. Among other uses, QDIR intends to implement their imagers in the recycling of black products, which conventional plastic sorting technologies are unable to detect.
• Zyvex Labs is a startup in Richardson, Texas focused on the development of atomically precise manufacturing. They are a member of the Quantum Economic Development Consortium (QED-C), a group of companies trying to grow the U.S. quantum industry. QED-C is an important player in the field of quantum technology and often speaks for the industry’s leaders.

Tech Area #4 includes robotics, automation, and advanced manufacturing. From a policy perspectives, this is an area where it is more important than ever for policy makers to have a deep understanding.  Automation has been the leading cause of job loss in America over the last two decades and the advent of affordable robots will only accelerate that trend.  Policy makers must stay aware of changes in this industry.  

• Kiana, a startup out of Silicon Valley, uses automated digital contact tracing to stop the spread of Covid-19. Their WiFi-based device location technology helps identify people, location and services that have been exposed to the coronavirus.
• RoadPrintz is a startup in Cleveland Heights, Ohio that uses robotics to safely mark transversal lines on roads. The company wants to improve worker safety by getting them off the ground and reduce costs by getting rid of stenciling.

Tech Area #5 includes natural and anthropogenic disaster prevention or mitigation. With the catastrophic floods in Germany, the widespread power outages in Texas, and wildfires raging in California, it seems like “one in one hundred years” weather events happen every week. It is essential to prepare for the realities of climate change.

• Active Charge is a Washington DC startup with a technology that monitors wind turbines for damage. Despite lightning strikes, vibrations, drastic temperature change, etc. threatening breakage and losses for the wind power industry, there is no way to monitor the larger turbines. The company developed a self-powered, integrated sensor-and-data transmitter solution to the problem.
• Natrx.io is a startup out of Raleigh, North Carolina that focuses on infrastructure protection, especially with respect to shoreline erosion and hurricane damage. They use digital technology to protect infrastructure through nature-based techniques in digital manufacturing.

Tech Area #6 includes advanced communications technology and immersive technology. Immersive technology, such as augmented/virtual reality, was estimated to have a consumer market of 6.3 billion dollars in 2020, globally. The field of advanced communications technology covers 5G networks, broadband access, Bluetooth, and more. 

• Headway Surgical, a Philadelphia, Pennsylvania startup, makes a surgery screen pointer communication technology. The screen pointer helps surgeons complete the 6.5 million minimally invasive spine surgeries that take place in the U.S. every year.
• TRAXyL is a startup in Gainesville, Virginia that uses roads to lay optic fiber. Their process allows cable to be placed directly onto paved surfaces without needing to cut into them. While it seems like a relatively innocuous innovation, it could help bring broadband and data connectivity in general to even the most rural parts of the country. 

Tech Area #7 - Biotechnology, medical technology, genomics, and synthetic biology. Bio and medical technologies are the headliners here, as they make up the major field when it comes to startups in the United States. This remains the case as more companies evolve and adapt their business models to meet the challenges presented by covid-19. Genomics and synthetic biology are more specialized, with most research in either area found at universities or academic hospitals.

• OneThree Biotech is a startup in New York City that focuses on high-level, computational drug discovery using artificial intelligence technology. Traditional drug discovery methods are shotgun and limited in data comprehension. OneThree Biotech built an AI program to combine datasets and distill concrete medical insights. They work with partners in the pharmaceutical industry, hospitals, and universities. 
• Keva Health, a startup in Lexington, Massachusetts, built a remote monitoring for patients who are having respiratory health issues - asthma, COPD, etc. The primary customers are physicians who use it to monitor their patients remotely. The platform includes features such as Bluetooth connected devices, two-way messaging, tracking, sending questionnaires, etc. They have two products: Keva365, which is for physicians, and KevaTalk, which is an app for patients to self-manage their asthma and communicate with the physician.

Tech Area #8 - Data storage, data management, distributed ledger technologies, and cybersecurity, including biometrics. After a May cyberattack caused a momentary crisis by shutting down the Colonial Pipeline, we understand the importance of cybersecurity to our nation’s infrastructure better than ever. Distributed ledger technologies (DLT) use a synchronized database to store information across a network of different computers. One example of DLT is cryptocurrency. The cultural phenomena and exponential success of Bitcoin, Ethereum, and other cryptocurrencies could portend an alternate future of finance. 

• Urban SDK is a startup out of Jacksonville, Florida that works with government agencies and municipalities to pull together data sources in one dashboard to improve reporting and give a cleaner look at the data. This allows policymakers to make better, faster, evidence-based decisions and monitor in real time.
• Aurign is an Atlanta, Georgia startup that uses data analytics and blockchain technology to automate music publishing agreements for artists to secure their royalty payments. They developed an app that automatically creates, and files split sheets (an ownership agreement between multiple contributors to a song).

Tech Area #9 - Advanced energy, batteries, and industrial efficiency, including advanced nuclear technologies for the purposes of electric generation. The performance of batteries continues to be a significant bottleneck on the development of new electronics. Technologies that increase industrial efficiency benefit our economy and our environment. In terms of advanced nuclear technologies, Energy Secretary Jennifer Granholm has expressed interest in new designs of small, modular reactors that are easier to build and less waste.  

• Ateois is a startup in Bloomington, Indiana that develops flexible batteries. Their technology for customizable batteries can be used in flexible electronics such as smart textiles, soft robotics, Internet-of-Thing’s devices, and medical/fitness-based wearable patches. Currently, electronics are limited in design and application by the rigidity of batteries. Ateois battery’s function more like a sticker, with a manufacturing process that conforms to the need of the product.
• New Iridium Inc., a startup out of Boulder, Colorado, uses photocatalysts to reduce manufacturing costs and time for chemical and pharmaceutical development. In addition to reducing the costs of chemical processing, the photocatalysis technology also reduces environmental impacts by reducing waste and energy-consumption.  

Tech Area #10 - Advanced materials science, including composites and 2D materials. In the past composites like cement and fiberglass became major parts of society. The next wave of advanced materials science includes graphene, the world’s thinnest, strongest, and most conducive material of both electricity and heat, reverse osmosis membranes, which expand the window of treatable water while reducing required pretreatment, and internet of things technologies that embed sensors into objects to record and analyze data in real-time. 

• Celadyne Technologies, Inc. is an Austin, Texas startup that makes materials for the hydrogen economy. The Celadyne material is a nanocomposite that can be formed like traditional polymeric membranes but offers many benefits of a ceramic separator such as lower hydrogen crossover. It also works at low humidity and elevated temperature conditions.
• XO-NANO is a startup out of Orem, Utah that develops smart foam technology. Their ‘Impact’ foam has built-in sensors that measure the precise location, size, distance & repetition of impacts. This data can be accessed and analyzed from a corresponding smartphone app. The technology integrates into a variety of different types of foam. Advanced sensors with general compatibility are the keystone of the Internet of Things industry. 

Equal Innovation Profiles:

Co-authored by Eric Johnsen, Williams College.