America Makes…Excuses

I didn’t plan to write a follow up article about America Makes. Their “pay to play” strategy creates a big barrier for startups, which I feel are critical to the development of the 3D printing industry. It’s hard enough for entrepreneurs to get a fair shake in the private sector. Organizations in the public domain should help level the playing field, not create even more barriers.

As I noted in my previous piece, America Makes is part of the National Network for Manufacturing Innovation (NNMI). Each of their nodes is supposed to provide “shared facilities to local start-ups and small manufacturers to help them scale up new technologies, accelerate technology transfer to the marketplace, and facilitate the adoption of innovation workforce skills.”

I also mentioned that the federal funding level for America Makes is up to $70 million. But the organization also receives membership fees and other investments from federally funded organizations like the FAA, NASA and the Department of Energy. It further benefits from tax dollars from public universities including North Carolina State, the University of Texas El Paso, and the University of Northern Iowa, among many others.

My point was that a $15,000 “membership fee” is prohibitive to all but the most well-funded startups. I feel they should lower the bar for new companies who could really benefit from those kinds of resources.

But, I received some feedback to the article suggesting that I didn’t have the whole story and that I ought to talk with representatives at America Makes. Fair enough.

Over the past month I have attempted to schedule an interview with the leadership at America Makes. On March 24, 2016 I got my first response. I was asked if I’d like to come up to Youngstown, OH for an in-person meeting. I said maybe, but wanted to start with a phone call. It’s a four-hour drive from my office, and again, I wasn’t even sure it was worth another article.

Out of respect, I offered to send my questions in advance. In a follow up email with the questions I added that, “If any of these questions are off-limits I understand.​ Also, ​if any of these questions have been answered online or elsewhere and you’d like to point me towards a link, that’s cool too. I don’t want to take up a bunch of your time, just trying to gather as much info as possible. My goal is to accurately and fairly tell the story.”

That request was also sent on March 24th. The person in question replied saying he would have answers to me by the following Monday, March 28th. I followed up on the 29th and heard back on the 30th that he was “called to DC this weekend” and was “really sorry about the delay.” I followed up again on April 5th. No response. I followed up again on April 13th and finally received a short response on Tuesday, April 19th, thanking me for my patience and saying that I “will have a response tomorrow,” which was yesterday. Still no response.

Here were my questions:

1)   According to your website, some project calls are open to non-members and “can be drawn from any combination of companies, academic institutions or individuals, as long as a member of America Makes leads the proposed effort.” Does that include the current project call? If so, do you facilitate the process for startups, or are they supposed to find a lead themselves?

2)  Do you find that member companies are receptive to working with startups to sponsor an America Makes project call? If so, do you find private (GE, etc.) or public entities (NASA, etc.) to be more receptive?

3)  It looks as though many of the members are universities and several of the projects have been led by them. Have any of your university members led a project, which included a startup that didn’t have a direct affiliation with the school (students, graduates, on campus accelerator, etc.)

4)   Of the 31 project calls that are currently underway, can you cite examples of those that were initiated by startups, yet led by a member organization? If so can you share names?

5)   If a startup were to work with a lead to submit a project, who owns the intellectual property that is derived from that project? I understand that each party owns their own background IP, but that anything developed as part of the project, must be shared with other members. How does that work? Can IP also be shared with non-members? If so, does the party that created the IP have a say in where it is shared and how it is used?

6)   How many of the 31 project calls that have been awarded thus far have been completed? What was the outcome? What’s the biggest success so far?

7)   Please define what is meant by “cost-share.” Can startup founders include their time as “labor?” Are there standard rates for specific parts of cost share elements (labor, travel etc.) Is this audited somehow?

8)   Can a cost-share estimate be submitted in lieu of the membership fee? Is there any way for a startup to participate without either paying the membership fee or partnering with another organization that is already a member (or willing to pay the fee and become a member)?

9)   Can the membership fee be refunded if the project does not receive an award?

10) What is America Makes’ operational budget? How many people are directly employed by the organization?​

As I mentioned above (and directly via email to the representative at America Makes), my goal was to accurately and fairly tell the story. Answers to these questions would be a big help.

Upon taking office, President Obama said that his administration was “committed to creating an unprecedented level of openness in Government. We will work together to ensure the public trust and establish a system of transparency, public participation and collaboration.”

He’s also been a big advocate of America Makes. Remember in his 2013 State of the Union address when he said, “Last year, we created our first manufacturing innovation institute in Youngstown, Ohio.  A once-shuttered warehouse is now a state-of-the art lab where new workers are mastering the 3D printing that has the potential to revolutionize the way we make almost everything.”

Based on the lack of response from America Makes, I can only can assume that they don’t share his values regarding transparency, public participation and collaboration.

The Obama Administration has also said that it is committed to taking “concrete action to improve the environment for high-growth entrepreneurship across the country, in five key areas”:

Unlocking access to capital to fuel startup growth

Connecting mentors and education to entrepreneurs

Reducing barriers and making government work for entrepreneurs

Accelerating innovation from “lab to market” for breakthrough technologies

Unleashing market opportunities in industries like healthcare, clean energy, and education

I’ve also seen little evidence that America Makes is unlocking access to capital for startups. As I mentioned above, a “pay to play” strategy has the opposite effect. They also don’t seem very interested in removing barriers and making government work for entrepreneurs. If there is a way around the membership fee, it doesn’t seem to be a straightforward path.

Maybe they’re just not getting the memos?

[Creative commons “No Excuses” is copyright (c) 2006 by Vandys]

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John Hauer is the Founder and CEO of Get3DSmart, a consulting practice which helps large companies understand and capitalize on opportunities with 3D printing. Prior to that, John co-Founded and served as the CEO of 3DLT. The company worked with retailers and their suppliers, helping them sell 3D printable products, online and in-store.

John’s original content has been featured on TechCrunch, QZ.com, Techfaster.com, 3DPrint.com and Inside3DP.com, among others. Follow him on Twitter at @Get3DJohn