Kentucky Science and Technology Corporation’s Michael Marshall teaches an Advance Kentucky math content session to Kentucky students.
Kentucky Science and Technology Corporation “is the organization that you’ve probably never heard of that runs the programs you love,” said Terry Samuel, president of the nonprofit organization.
Founded in 1987 by Kris Kimel and Lee Todd, the Kentucky Science and Technology Corporation (KSTC) has grown to become instrumental in advancing science and technology in Kentucky and operates numerous programs related to education, entrepreneurship, economic development and other efforts.
In December 2020, KSTC moved its offices to the third floor of Dudley Square in downtown Lexington. It opened its first satellite office in Louisville in November and is working to increase its reach in serving Kentucky’s growing tech economy.
Terry Samuel
Samuel joined KSTC five years ago after 30 years with Lexmark and IBM, first as an engineer, then as a business executive. “I was a private industry guy,” Samuel said. “To come into a nonprofit, a statewide economic organization, I had a lot of learning to do.”
He conferred with leaders of similar organizations in over a dozen other states. Some of those organizations are part of state governments. “We’re private or non-statute,” he said, “but we have a close relationship with the state.” That relationship has developed over 34 years.
In the late ’80s, “there was clearly a need to do something in the state to expand and extend a focus on technology and innovation,” said Kimel, who served as KSTC president for 30 years. “We were in a huge transition in our economy, to court globalism, technology, innovation, communications, all of that. Lee and I came up with this notion that we could create something to help push the state in the direction of technology and innovation, to provide leadership in that area.”
With seed funding provided by the state under former Gov. Martha Layne Collins’ administration, KSTC started as an advocacy initiative. In 1989, KSTC published a report, Kentucky Innovation Compact, that presented strategies to advance technology and innovation in Kentucky, including advancing education in science, technology, engineering and mathematics (STEM).
Their report got the attention of the Brown Foundation in Louisville, which funded KSTC with a quarter of a million dollars. “That was the turning point,” said Kimel. KSTC became an incubator of programs to foster technology innovation through education and business creation.
“We have to be constantly innovating,” said Samuel. “Some programs we keep going, but we are constantly innovating on our programs.” Whether it’s working with federal or state government, universities, school systems, or business organizations, partnerships are critical in implementing KSTC programs.
Innovation means being open to stepping outside the usual bounds of their endeavors. One such program is Kentucky VALLO, funded by the Department of Labor, which helps military personnel who’ve acquired special skills training in the services to get certified or licensed in Kentucky. About 16,000 service members transition to civilian life every month, said Samuel. Some of them have special training and are willing to move to Kentucky, where some employers are having trouble finding skilled workers. KSTC has developed 46 pathways, from social workers to mechanics, resulting in state certifications in those fields.
The Kentucky Enterprise Fund, the primary fund of KSTC Venture Finance, made its first investment in 2002. The fund has invested over $30 million in over 160 companies, 70 percent of which either provided a positive return or are still operating in Kentucky. Those companies drew follow-on investments of about $1.4 billion, according to KSTC tracking. In addition to funding, KSTC provides logistics support for startups.
Its Virtual Academy, part of Advance Kentucky, the education arm of KSTC, makes advanced physics and advanced calculus available to students across the state. During the pandemic, Advance Kentucky moved much of its advanced placement (AP) content online to ensure that students across Kentucky have access to content to prepare for AP exams.
KSTC conducted longitudinal studies to see how Advance Kentucky AP students fared with college. Significantly more of those students attended college, stayed enrolled longer and attained higher graduation rates, as compared to a control group. “It’s a great program for the state,” said Samuel, “and it consistently gets support from the Kentucky Board of Education and the General Assembly.”
Kentucky is one of several states to offer the Maker Minded program through a collaboration between KSTC and LIFT national manufacturing institute, which opens the doors for students to consider careers in advanced manufacturing. Another Advance Kentucky program, Access Algebra, prepares middle school students for high school calculus, essential for those pursuing the sciences. KSTC also has a computer science initiative for schools, including a partnership with code.org and a program for digital literacy with 3D printing.
KSTC also works with higher education but on the business side. In partnership with the University of Kentucky and the University of Louisville, KSTC formed the Kentucky Commercialization Ventures (KCV). KCV offers expertise to the six regional Kentucky universities and the Kentucky Community and Technical College System (KCTS) in transferring research and development projects to commercialization, bringing products to market and creating revenue streams for the colleges.
“We have the first-ever patent application from KCTCS,” said Samuel, “and we have the first licensing deal on something coming out of Eastern Kentucky University.” Included under the KCV umbrella is the Kentucky Network for Innovation & Commercialization (KYNETIC), which receives funding from the National Institute of Health to develop healthcare products.
In addition to its education endeavors, with over 30 employees in Lexington, in a Louisville office, and in Bowling Green, Paducah, Somerset and Covington, KSTC provides a variety of support programs for Kentucky companies. “Our mission is to build a thriving technology-based entrepreneurial economy for Kentucky,” said Samuel.
Another partnership Samuel highlights pairs KSTC with Kentucky Innovation, a program of the Kentucky Cabinet for Economic Development (CED). Anthony Ellis, executive director of Kentucky Innovation, describes KSTC as “your primary one-stop-shop” for small businesses with scalable growth potential to find investors and resources.
In 2020, the CED redesigned the structure of its system for supporting economic growth and innovation across the state. Six KY Innovation Hubs or regions encompass all 120 counties.
“KSTC has done a great job helping lead that transition in a pretty smooth manner,” said Ellis. Part of the drive to boost Kentucky’s tech economy at this time, Ellis said, is “the great migration.” Over 4 million people quit their jobs by the end of last year. “We’ve seen a huge uptick in one-way moves from the coasts to middle America,” he said. “We think there’s a great opportunity to recapture a lot of talented Kentuckians who had moved away. We need an influx of high wage, high skill earners to keep our state at the forefront and keep moving ahead.”
Ellis also pointed out that Kentucky moved from a ranking of 42nd to 16th among U.S. states in receiving grants through the federal Small Business Innovation Research and Small Business Technology Transfer programs. KSTC, through its Kentucky Science and Engineering Foundation, guides companies in navigating grant processes with 11 federal agencies.
Kentucky is one of 16 states, said Ellis, that has instituted a matching grant program for companies that are awarded SBIR grants. The matching grants can be used to cover operating expenses that aren’t covered with SBIR grants, and the program has drawn 42 companies to relocate to Kentucky, Ellis said. KSTC manages the matching grants programs.
On the other side of the equation, the KSTC program Kentucky Procurement Technical Assistance (KYPTAC) helps businesses connect with federal, state and local governments in need of their goods and services.
It all works together. Samuel keeps in contact with Lee Todd, professor of engineering and former president of UK. He likes to recall Todd’s lament that he had been sending his engineering graduates out of Kentucky to find work. “Why not create the work right here in Kentucky?,” he asked. Which is a concern for which KSTC continually seeks to find solutions.