Arizona Technology Report

Sept. – Dec. 2O11 aztechcouncil.org

Arizona Technology Council: The Voice of the Technology Industry

President’s Message

In This Issue Arizona SciTech Festival ... Page 2 Governor's Celebration ... Page 4 Journey to China ... Page 6

Who We Are The Arizona Technology Council is a private, not-for-profit trade association with a mission to CONNECT, REPRESENT, and SUPPORT the state’s expanding technology industry.

Phoenix Office One Renaissance Square 2 N. Central Ave., Suite 750 Phoenix, Arizona 85004 Phone: 602-343-8324 Fax: 602-343-8330 info@aztechcouncil.org

Tucson Office The University of Arizona Science and Technology Park 9040 S. Rita Road, Suite 1150 (near I-10 and Rita Road) Tucson, Arizona 85747 Phone: 520-829-3440 Fax: 520-829-3441 tucson@aztechcouncil.org

Meltdown. Yes, it’s the end of summer and you’ve no doubt heard that word a lot lately. But instead of it being a oneword response to that annual question on how you’re handling the heat, the context has shifted to Wall Street. Granted, who didn’t gulp hard when the Dow dropped more than 600 points in one session following a week of triple-digit losses and the historic downgrade of the U.S. credit rating by Standard & Poor’s. It’s enough to make anyone start to wonder whether the future can only get worse. Need some good news? Look to the technology industry. It traditionally has been the sector to pull the U.S. economy up from the doldrums and this time is no exception. Some of my most recent examples came at a few events hosted by the Arizona Technology Council. At the VIP reception following our Board of Directors meeting, I talked with a number of guests who shared how their businesses are on the upswing. At our annual Partnering Conference held in conjunction with AZBio, the room was filled with representatives from businesses sharing opportunities for others to work with them to create needed products and services. Speaking of new markets, we have generated a great deal of interest in our upcoming trade missions to China—our second time there—and India that offer Steven G. Zylstra, President and CEO, the chance to do business far beyond Arizona. This recovery combined with the Arizona Technology Council Internet gives Arizona companies the chance to market to the world. (Look in this section for more information on how to join us on the trips.) The prospects are not just limited to Arizona. The nation’s technology community feels just as positive. I recently returned from the annual meeting of the Technology Councils of North America where my colleagues from sister organizations reported their own members are thriving and growing. None of this can happen without partnerships. I’m happy to report that a long-time ally of the Council will have an even greater influence on our successes. The Arizona Commerce Authority is the new name of the quasi-agency charged with statewide business attraction. The Authority is focusing its efforts on aerospace and defense, science and technology, solar and renewable energy, and small business and entrepreneurship. Sound familiar? It should. These sectors already have a strong presence in our membership. So it makes sense the Authority has evolved into a key strategic partner. So, take heart. As I said, the technology community has been the leader of past economic recoveries and this time is no exception. Soon all of Arizona will be hot. And I’m definitely not talking about the weather!

Management and Staff Steven G. Zylstra

Leigh Goldstein

Justin Williams

Phillip Huebner

President and CEO

Director, Programs and Events

Executive Emeritus, Tucson Office

Director, Arizona Science and Engineering Fair

Deborah Zack

Don Rodriguez

Don Ruedy

Director, Membership Services

Editor, TechConnect

Executive Emeritus, Tucson Office

Merry Lake Merrell

Ron Schott

George Land

Director, Marketing and Communication

Executive Emeritus

Director, Arizona Innovation Institute

Jamy Battle

Jim Harris

Joe Tidwell

Director, Finance and Administration

Director, Tucson Office

Project Manager, GetSTEM-AZ, and State Director, Project Lead the Way

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Jeremy Babendure, Ph.D. Director, Arizona SciTech Festival

Lianne Miller Intern, Phoenix

Jerry Burger Intern, Tucson

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Arizona SciTech Festival Statewide event will celebrate what Arizona has to offer A remembrance of our past will also be a reason to celebrate our future. The first Arizona SciTech Festival will be launched in conjunction with the state’s 2012 centennial celebration in February. Coordinated by the Arizona Technology Council Foundation, the festival will offer a series of hands-on activities and workshops, stunning exhibitions, concerts, guided walks and tours. A collaborative effort involving more than 150 public and private organizations from industry, business, education, arts and culture, philanthropy and the community will stage the event. Working together, the festival is expected to get the public excited about the scientific and technological innovations occurring throughout Arizona; ensure students are excited about science, technology, engineering, and math (STEM) opportunities; and offer a powerful means of attracting industry and opportunity to Arizona with a platform that builds community and innovative collaborations among its stakeholders. Once launched in 2012, the festival will become an annual event to serve as

a continuing, highly visible platform for academia, business, and the K-12 system as it highlights how science, technology and educational advances are key to

Arizona’s expanding workforce and economic future. The goals for the Arizona SciTech Festival include showcasing the state’s research

Coming Together The Arizona SciTech Festival’s director Jeremy Babendure is already at work. Most recently, he has served as the BioBridge director at the University of California at San Diego. Besides the Arizona Technology Council, organizations expressing interest in participating include the Arizona Aerospace & Defense Commission, Arizona Business & Education Coalition, Arizona Center for Afterschool Excellence, Arizona Charter Schools Association, Arizona Department of Education, Arizona Game and Fish, Arizona Geological Survey, Arizona K-12 Center, Arizona Nanotechnology Cluster, Arizona PTA, Arizona School Administrators, Arizona Science and Technology Fair, Arizona Science Center, Arizona Science Teachers Association, Arizona State University, Audubon Arizona, Arizona Commerce Authority, Barrow Neurological Institute, Biosphere 2, Boeing, Covance, Cox Communications, Discover Science 4 Kids, Embry-Riddle Aeronautical University, Flagstaff Festival of Science, Flinn Helios Education Foundation, Integrum Technologies, Intel, International Council of Systems Engineers, Maricopa Community Colleges, Maricopa County Education Service Agency, Mesa Biotech Academy, Mesa Historical Museum, MicroChip, Northern Arizona

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Center for Entrepreneurship and Technology, Northern Arizona University, Orbital, Raytheon, SRP, Science Foundation Arizona, and The University of Arizona. The model for the festival is San Diego’s Science Festival, which draws over 60,000 participants annually. In Arizona more than 300 activities are expected to occur in diverse neighborhoods throughout the state with: • Signature events highlighting the innovative character of each region (e.g. aerospace, technology, bioscience) with high energy exhibitions and shows • Neighborhood science hubs providing workshop and discussion opportunities at locations such as schools, libraries, community centers and cafes • In-field experiences at science and technology facilities throughout the state. Also, the Arizona SciTech Festival will serve as an annual focal point in schools with projects, workshops and competitions feeding into the February festival and sign-up opportunities for science and technology activities in spring and summer.

and technology strengths to create a local and national image of Arizona as a place where opportunities exist, innovations regularly occur, and intellectual ideas are shared and cultivated. Another goal is to interest people of all ages and cultures in STEM opportunities that exist in Arizona, expand activities into locations not typically served, and inspire a diverse STEMoriented future workforce. State and local leaders support this initiative as a powerful vehicle for leveraging productive synergy in the scientific, educational, and business communities. This could lead to increased output of future innovators in STEM, resulting in more jobs and increased economic stability for Arizona. Given the confluence of events and potential scale of the overall initiative, an action committee has been established to facilitate collaboration among events, coordinate communication with sister organizations and leverage a grassroots cross-promotional effort to reach a larger audience through networks that include schools, businesses, and community centers.

A Sample Signature Event for Arizona SciTech Festival EX-STATIC Feb. 25 EX-STATIC is part of a new dynamic: an Arizona State Universitybased challenge to students, faculty, staff, and community partners alike to showcase the very best examples of innovative research and practice in scientific, technological and artistic endeavor. Hosted by ASUâ&#x20AC;&#x2122;s highly energized New College of Interdisciplinary Arts and Sciences at the West Campus, EX-STATIC will be celebrated during a daylong festival of entrepreneurial enterprise. It is anticipated that teams will coalesce around projects stemming from faculty and student research, academic course curricula, professional and commercial innovation, and creative initiatives. Live demonstrations, presentations, and expositions will be enhanced via digital photography, videography, streaming Web material, gaming, and techinspired or tech-driven performance.

Tech firms can benefit from new fund Arizona technology companies looking for the funds that can lead to even more success are invited to apply for money available through a Credit Opportunity Fund. The fund will provide capital to small, growing companies in Arizona that are looking to achieve a higher level of performance. Targeted are high-quality businesses that are market leaders with competitive advantages and provide have strong potential for growth. Sun Mountain Capital of New Mexico is the fund manager. Typically, Sun Mountain Capital has backed management buyouts, acquisition financing, ownership succession, and growth capital. Investment sizes are generally $3 to $10 million. For financial performance, the companies have an EBITDA of $2 million to $10 million with attractive operating margins, stable cash flows, and a positive outlook for growth. The companies receiving the funds tend to have high quality management teams with significant investment or ownership in the company and aligned incentives. The fund is supported through a partnership with Los Alamos National Bank in New Mexico For more information, contact David Kocon at david. kocon@sunmountaincapital.com or Brian Birk at brian.birk@ sunmountaincapital.com.

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Best of the Best

Governor’s Celebration of Innovation pays tribute to winning ways The state’s technology community is getting ready to honor its own as the Arizona Technology Council puts finishing touches on its annual Governor’s Celebration of Innovation. The awards ceremony and dinner will be Nov. 17 from 3 p.m. to 9 p.m. at the Phoenix Convention Center, North Building, 100 Level, 100 N. Third St. This year’s theme, Arizona Rising, is fitting as the technology industry already is the bright spot of the recovering economy. The event attracts more than 1,000 attendees each year for a night of networking, food and entertainment. The awards portion of the event will be a theater-style presentation followed by a sitdown dinner with live music. The high point definitely is the awards ceremony. The top prize, the 2011 OneNeck IT Services Lifetime Achievement Award, will be given to Roy Vallee, Executive Chairman of the Avnet Board of Directors. “Winners of the Lifetime Achievement Award are mentors and motivators who inspire others and exhibit exceptional creativity, ingenuity and leadership to change the fabric of the technology industry and the state,” said Steven G. Zylstra, president and CEO of the Arizona Technology Council. “As an organization that supports and promotes the benefits of science and technology, we are proud to acknowledge and recognize them.” The other finalists were Robert Gillette, chief executive officer of First Solar, and entrepreneur Pat Sullivan, former CEO of Flypaper Studio.

Variety of Awards The awards to be presented the night of the Governor’s Celebration of Innovation are:

Pioneering Award Presented to an outstanding company that has gone above and beyond the call of duty in contributing to Arizona’s technology industry through sustained business presence, corporate citizenship, community involvement, and business success.

Green Innovator of the Year Award Presented to a company or business unit in a technology industry that has demonstrated extraordinary performance related to sustainable environmental practices. The company should have achieved significant business success, and technical innovation or scientific achievement in the past year, and either the company’s product, business solution, or the innovation itself should be environmentally supportive and sustainable.

Sandra Watson of the Arizona Commerce Authority receives the 2010 Chairman's Award from Steve Phillips, the Council's chairman of the board.

2011 OneNeck IT Services Lifetime Achievement Award winner

William F. McWhorter Community Service Award Presented to an individual or organization (including not-forprofit) that contributes to Arizona’s technology industry through relentless community involvement, leadership, visibility and excellence in economic development activity.

Ed Denison Business Leader of the Year Award

Photos by Mark Goldstein

Presented to an individual who contributes to Arizona’s technology industry through sustained growth of their business or company.

Participants in the 2010 Technology Showcase.

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Roy Vallee Executive Chairman of the Board, Avnet Inc. Roy Vallee joined Avnet in 1977 and served as the company’s chairman and CEO from July 1998 until July 2011. During his tenure, he accelerated Avnet’s success as an industry consolidator and was instrumental in Avnet’s acquisition of 47 companies to increase geographic coverage, scale and scope, and shareholder value. Vallee served as a founding member of the Governor’s Council on Innovation and Technology and was later asked by current Arizona Gov. Jan Brewer to join the Executive Committee of The Arizona Commerce Authority. He also participates in Greater Phoenix Leadership. He is a member of the boards of directors of two other publicly held companies: Teradyne, a leading automated testing company for the semiconductor industry, and Synopsys, Inc., the leading supplier of electronic design automation software.

Innovator of the Year – Start-Up Company Award Presented to a company or business unit in a technology industry that has achieved significant business success, and technical innovation or scientific achievement in the past calendar year.

Innovator of the Year – Small Company Award: Presented to a company or business unit in a technology industry that has achieved significant business success (including profitability), and technical innovation or scientific achievement in the past calendar year.

Innovator of the Year – Large Company Award Presented to a company or business unit in a technology industry (no limit on the duration of the project) that has achieved significant business success (including profitability), and technical innovation or scientific achievement in the past calendar year.

Innovator of the Year – Academia Award

Photo by Mark Goldstein

Presented to a department or office within an accredited higher education institution that has achieved success through innovation in the past calendar year.

2011 Governor’s Celebration of Innovation: Arizona Rising 3 to 5:30 PM – Technology Showcase/ Networking 5:30 to 7 PM – Award Presentations 7 to 9 PM – Dinner/Networking/Live Band Tickets AZTC Member: $150 Non-AZTC Member: $200 Table of Ten, AZTC Member: $1,250 Table of Ten, Non-AZTC Member: $1,750 To get your tickets, go to www.aztechcouncil.org. For questions about sponsorship opportunities, please contact Leigh Goldstein at lgoldstein@aztechcouncil.org or Merry Lake Merrell at mmerrell@aztechcouncil.org

Participants in the 2010 Technology Showcase.

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Chinese Connection

Second tour to China offers new options for doing business To stay competitive, companies need to reach out, even if that means going to the other side of the globe. With this mindset, the Arizona Technology Council has created a trade mission program to connect with what many consider one of the most vibrant and dynamic economies on earth: China. The Council will help lead a group to China for 10 days starting Sept. 14. The itinerary the cities of Shanghai, Hong Kong, Macau, Shenzhen and Chendgu. Beside Shanghai, the inaugural tour last fall included the cities of Beijing, Xi’an, Zhangjiagan, Suzhou, and Hangzhou. On this trip, the Council has teamed with the Arizona Chamber of Commerce & Industry to make it possible. The first trip was led by the Council alone. The Council recognized that success cannot be measured with just one trip. The dialogues have to be ongoing and a corridor needs to remain open between Arizona and China. With that in mind, planning for the next trade mission began almost as soon as the first delegation returned to the United States.

Arizona Technology Council's 2010 delegation in China

According to Steven G. Zylstra, president and CEO of the Arizona Technology Council, “We received such positive feedback and generated so much interest from our first trip that it naturally led to many discussions with our business partners. When we sat down with the chamber, it was clear we had a common set of objectives

Next Stop: India Interest has also been shown into tapping into that other Asian nation that offers additional promise for Arizona. That is why planning also is underway for a delegation to travel to India in February 2012. This delegation will and travel to Delhi, Hyderabad and Mumbai before returning to Phoenix. This trip will include meetings with American companies operating in India as well as its academic and economic development leaders. The Arizona Technology Council also is working with the U.S. Commercial Service, which is allowing businesses to arrange meetings with potential partners under its Gold Key Matching service. The trip is open to Council members and non-members interested in learning about doing business in India and opportunities to export to India or utilize Indian services to strengthen their Arizona-based businesses. To learn more, Contact Merry Lake Merrell at 480.467.8251 or mmerrell@aztechcouncil.org.

Arizona Technology Report

for helping Arizona’s businesses capitalize on the market growth in China, and that we should join forces for the second trip.”

Face-to-face The intent of the program is to give members the rare opportunity to meet face-to-face with government officials, industrial park leaders, peer companies, and consumers—all with the intent of opening the doors to new opportunities. From factory visits to formal dinners, members of the delegation have unprecedented access to company representatives and government officials that allow them to directly ask questions and get answers about one another’s needs. Topics to be covered in China include: manufacturing, technology, academia, law and a general overview of international business. In addition, participants will learn firsthand about China’s political and economic systems, traditions, and history. This tour is open to Arizona Technology Council and Arizona Chamber of Commerce & Industry members and nonmembers. The trip is being coordinated by China Direct Consulting Group and China International Trade Services, and sponsored by Snell & Wilmer law firm. To learn more, Contact Merry Lake Merrell at 480.467.8251 or mmerrell@ aztechcouncil.org

Tomahawk cruise missile produced by Tucson-based Raytheon Missile Systems.

Creating A New Community Conference will help unite state’s aerospace and defense industry As Arizona continues to be a key part of the nation’s aerospace and defense industry, it’s only natural all parties involved in its success find a way to come together to share their needs and plans. That’s the key reason behind the first Arizona Aerospace, Aviation and Defense (AAD) Requirements Conference, which is scheduled to be held in late January. The Arizona Commerce Authority recently named the Arizona Technology Council as host for the historic event. The purpose of the conference is to catalyze industry growth in Arizona by creating a forum for: ▶▶ Arizona AAD primes and suppliers network to identify future requirements to meet the needs of customers ▶▶ Collaboration between Arizona industry stakeholders ▶▶ Arizona AAD small business owners to learn about Small Business Innovation Research/ Small Business Technology Transfer opportunities The 2010 annual report of the Arizona Aerospace & Defense Commission highlighted strategies needed to retain, attract and grow the aerospace, aviation and defense business in the state. A top recommendation to improve the business environment was to stage the conference. As host, the Council, which holds more than 100 events annually, will be in charge of such logistics as securing speakers, sponsors and registrants. Plans should also include networking events as well as coordinating

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volunteers. The dates and location of the conference will be announced later. Arizona’s A&D industry designs and produces essential weapons and technology to help the nation’s military achieve national security objectives. Attendees at the conference are expected to include key research and development personnel from The University of Arizona and Arizona State University, leadership from Science Foundation Arizona, and, of course, Council members who are

setting the pace in A&D research and development. This conference builds on the annual bipartisan Congressional Arizona Aerospace and Defense events Rep. Gabrielle Giffords co-hosts with Rep. Trent Franks and the Arizona Chamber of Commerce to highlight the state’s defense and aerospace industry. To become a conference sponsor or get other information, contact Leigh Goldstein at lgoldstein@aztechcouncil.org.

Training, job placement for energy workers A newly formed consortium will use a $6 million federal grant to train nearly 16,500 workers and place them in jobs within the state’s energy sector. The focus of the Arizona Energy Consortium is to establish a skills pipeline that meets and sustains the workforce demands of expanding green energy industries. City of Phoenix staff met with industry partners from utility, renewable energy and energy efficiency sectors who agreed the consortium should be created with the goal of collaborating on the growth and retention of energy companies in the state. The Arizona Department of Economic Security submitted the grant proposal to the U.S. Department of Labor under the Recovery Act. The consortium will operate under the umbrella of the Arizona Technology Council and be chaired by Michelle De Blasi, a partner at Quarles and Brady who heads the firm’s solar energy law team. For more information or to become a consortium member company, contact De Blasi at michelle.deblasi@quarles.com or the Council’s staff liaison Leigh Goldstein at lgoldstein@aztechcouncil.org. Non-Council members can join the committee in its first year, but after that everyone serving on the committee must be a Council member.

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connect + grow We exist to help science and technology companies of all sizes and stages succeed. By serving as the principal point of connection, the Arizona Technology Council can help you build global partnerships to grow locally, get your innovations noticed and stay ahead of the curve.

take a fresh look Whether you’re a part of a startup, emerging or well-established

Take a fresh look and watch us grow with you as we continue

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to offer you membership benefits that will bring you closer to meeting your business goals.

insight, education, and connections. In addition to our networking opportunities, public policy support and professional development programs, our members receive exclusive discounts on products and services and are provided numerous opportunities to get the word out about their unique value.

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