Vermont Legislature SmartTranscripts:

[Michael Marcotte (Chair)]: Good morning, everyone. This is the Vermont House Committee on Commerce and Economic Development. It is Tuesday, 01/13/2026 at 09:01 in the morning. So we're beginning our week, with David Bradbury from BSET, Vermont Center for Emerging Technologies. David, welcome. Thank you for joining us this morning. Somehow, we didn't get you in last year, and, I thought it would be good right at the beginning of the session to number one, introduce you to the committee. And for those that don't know, you can bring them up to speed of what you you do and what VSAT does.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Great. Thank you very much for the invitation, and good morning, everybody. I'm Dave Bradbury and I'm currently the President of the Vermont Center for Emerging Technologies or VCET, vset.co.co. So we lose a lot of people to dot coms. And I really want to just give you by way of background. I first came to Montpelier, I think it was May 1992, to work in the Agency of Commerce for then Secretary Frank McGoogle and got involved in all sorts of fun stuff. I was deputy commissioner for a couple of years. And then I've continued working in committees and groups and other organizations around economic development here in Vermont. I've lived and worked in, I think, it's five different counties here in Vermont, really going from Queechee down that way up toward Burlington and Addison. And I live in Memorial County now with my wife Emily, who's from Brattleboro, Reading, Guilford that way. So really nice to have a built and seen a perspective all around Vermont. So what we do at VSET is really just very simply we try to come up with these actionable advantages to help people start, scale, sustain their business. It's predominantly tech or tech enabled businesses. We're not particularly good at restaurants, retail, or real estate. Thank goodness there are others like the SBDC or the RDCs or others that do. So really starting off almost 25 ago, actually it was twenty five years ago, John Evans was then dean of the UVM Medical School, worked with the agency of commerce in the state and at UVM and Senator Leahy to kick off this idea called VSAT. How can we incubate? How can we commercialize? How do we get students, faculty working together? And how do we kind of figure out how we start more businesses in towns around the state or up these dirt roads that we so love to travel, except for April? And I think since that time, we've been a nonprofit, a self perpetuating board made up of higher education presidents to entrepreneurs to economic development leaders. Really, it's blended and shifted over the time as we've tried to figure out what's really needed. And it really comes from what we hope is a lot of outreach and empathy about where's the pull, where's the need rather than this is what we do and all of us have done. So I think it's been fairly nimble over the seventeen years that I've been involved. Real simply, people, platform and capital is how we sort of divide up the topics or the areas that we do. From a team, we're four full time people with a couple of part timers, including Javan Sears, I just found out, friend of yours, from school. And really, we try to be authentic, serve the entrepreneur. It ain't about us. We try to have empathy through our outreach, through very deliberate programming, so we maintain size. Know engagement is higher when there's under 80 people in an event. Like last night was our Female Founders event at Hotel Vermont. It's our tenth season. We get 85 or more people in a room and had a panel on women's health. It was awesome. And we taped that with public access media. It's called Media Factory, and it goes out to almost seven states. Southern Quebec as well. So people get to tell their story, a Vermont story, and we hit a lot of households in the region. We've got a new facility in the works to be identified. Then again, I like to think we hustle and earn it every day as we go forward. You can play this video if you're interested, but we resimilated down the new president at UVM, Doctor. Trump, to meet some entrepreneurs, meet some founders, some student founders, some rocket scientists around a table. And then we invited others that are influential. Like you might recognize Mike Peach check there or Lindsey Curley in the corner. They get to see. And this is part of the construction where the entrepreneur is the center of the universe for this hour. And we do it over and over through the years, and it's really great. So I've made this invitation off before, but if anybody ever wants to come up to the petting zoo and see some entrepreneurs or some students in action, please, we're right on Main Street in Burlington. Just some numbers. We try to focus on outputs impacts. This is fiscal. This is as of June this past year, but we met one on one with two eighty eight companies predominantly or founders. If there's three people on a team, counts as one, just by way of reference. And this is our differentiation and our offering here, is this trusted expertise to help you think it through. It's at the ideation phase, or it's a company with $50,000,000 $60,000,000 in revenues coming in with their team to try to figure out what's next or how could I take a patent off the shelf and maybe translate that into a new line of business. I think an example of that would be Chroma Technologies years ago coming and saying, Oh, we want to make the whole machine now. Let's stand up something called 89 North. So that was an example. We've seen now over 4,200 stories, people coming in. So what's happened is institutionally, we've built up this sort of library card system of folks that can help. Maybe they've been there before that. If anybody's ever had a mentor in business professionally, that is really the game changer. And that's where I personally believe in seeing that Vermont's size is the advantage. It's really easy to reach and access folks to ask for help. 99% of the time, people offer. We track capital that companies have raised, revenues that they earn cumulatively since, what's this, 2008. And I'll just point out these two numbers, dollars $780,000,000 in revenue, dollars $614,000,000 in capital total. The takeaway isn't a number because we only have a subset of what goes on in Vermont, but the fact that revenues are now greater than aggregated inputs of capital. Okay, so on the whole, companies are using their customers' money, which for startups that borrow banks and venture money and whatnot, that is awesome. I think we crossed the line three years ago, and there's no looking back. So I don't know. I'm very optimistic about the future. And then payroll. This last survey on Fund one, it came in about $100,000 as the average pay, including some benefits. It excludes any ownership that folks might have in those companies. I won't go through this whole thing, but we do operate on the capital side. We've two evergreen funds, meaning they revolve. And then a fund zero, which is something that has popped up that folks have donated shares to be set as a thank you and a pay it forward. Yeah, we're a five zero one(three), so maybe they get some deduction. Many of those companies that we've helped advise through the years that might have gone on to sell their business for low millions or multiple tens of millions of dollars have also paid it back. And again, that allows us to go help the next student, bring them in, paint the wall, do that kind of stuff we all do, and support other institutions and organizations as they stand up in their communities. This is a super busy slide. And we worked really hard to make it not so. But we've rebranded this concept of a platform. Three years ago, it used to be places. It was tied to a physical place. At one point, VSET had three facilities. Right? Others in the community started standing them up. We seed funded some of them. We gave them operational support. And we really feel that a local community needs to own it. We didn't want a VSAT in every town because it looks like a rest area system, not an entrepreneurial system. And if the local community buys in, like Monique did down in Bradford for all those years and in Springfield at Brick, we feel those are the best outcomes. So then we said, all right, how do we support those centers and those hundreds of folks a year from around Vermont that we don't have to make them drive to Burlington or do a Zoom? And we're like, all right, here's what they need. Let's get them discounts on things. Let's get them free things. So cloud credits. Dollars 100,000 in cloud credits. Like, the top user of that was $300,000 in free credits by a company up in St. Johnsbury. $500 a month off maybe some HR software. If you're a hardware person, the software, the CAD design software is really expensive. You need $75,000 for a license. So we got those for free for a period of time. So, again, how do we export those? And I'm really happy to say that we can get these to just about everybody. They still need to be accepted by the provider. But if you remember at Brick or Hula or Do North, we don't care. We're not trying to sell you anything. We give it to those managers so they can attract more people into their membership model and hopefully sustain. So I'm smiling because this has become the most exciting part of what we do. It allows us to scale a small team into more households and more businesses. In that, we have a first year newsletter, which I can't believe that 68% of people seem to open this every month. It goes to about 7,000 people really around just nerdy stuff, meetups on this or vibe coding, stories that we tell, profiles on people and companies. Again, how do we demystify, educate, and help aspiration toward some sort of economic freedom and growth for individuals? No cost advising. And then we started this podcast that's been out for ten years, which is kind of fun. And then jobs in Vermont. So jobs, over the last six months, last spring, I guess it was. It's more than six months now. I started getting or we as a team started getting more inbounds around jobs as tech was retrenching nationally, remote was sort of going back to some new normal level. And I hadn't had or VSAT, rather hadn't had that many inbounds since 2009, the financial crisis. And we were like, holy smokes. Something structural is going on here. We're kind of hearing it anecdotally. And we heard also between AI agents, and there was just disenchantment on how people were applying for jobs. The employers didn't like it, nor did the applicants. And

[Michael Marcotte (Chair)]: we're like,

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: all right, well, let's license this really nifty piece of software. Let's invite in 70 companies, some of ours, some of theirs, some big anchor employers, and let's just see if under a a guise of trust and focus, whether or not we can improve selling Vermont to somebody or letting them know about more than one engineering job or marketing role. And it's been really neat to test during this phase. And these are some of the numbers here. We don't charge anybody for this, But there's been over, I guess now, 500 jobs now as of year end. The page visits are unique views of a job listing and description, that they're coming to us versus Indeed or one of these other sites. So there's something there. We're trying to scale that and make it not too big that you get lost, but focused enough around tech and, I'll call them, anchor employers. What we found out through our own portfolios hiring was that sometimes there's a spouse or a partner coming along. And, well, they always seem to go work at Middlebury, UVM, the hospital, National Life, and then a startup. So it was almost like a little balance in the household. So we're like, all right, let's make it easy for that viewer or that household to see what's out there. So stay tuned on this one. We're really, really pleased. And just for reference, this is a $5,000 piece of software we licensed that's been around for a couple of years. And we are thrilled. People, platform, capital. This is a little bit about the fund family that we operate. I'll start with Fund II at the bottom. That's the newest fund. It launched really twenty four months ago. This came about from a $9,000,000 appropriation that Senator Leahy secured, actually from HUD. So we actually found a way Is it HUD? Yes, HUD. Using HUD money for revolving early stage company support. These are convertible notes. There are these things called safes. There's forms of loan, but also stock and ownership. And the idea is, let's try to go in early. Let's try to leverage other monies and go out. And we've invested, as of this point, about $4,700,000 We accelerated investing this last year because we were a little nervous as to what Washington was going to allow or not. So all good plans change, right? But that's been really neat to see. And we're in companies that are doing biomaterials that are sort of non petroleum based products for diapers, for example, or to replace nylon. We've just given I won't announce that one, but we're right now in a surgical mining business, which is a brand new technology using machine learning, advanced mapping, digital twins, and actual mining of precious metals and rare earths in known deposits, known veins. So these are uneconomic or not environmentally permissible resources that are adjacent to an open pit or a traditional mine that we can go in and, like laparoscopic surgery, go in and take these things out, move it over, and then refill the last hole. So really exciting. And the machine learning and the AI team will be based out of Burlington, at ESET, where the CTO is located. And then Fund one. This is the Vermont Seed Capital Fund. This one was formed by the legislature and the governor and VITA and us and others back in the Ara days. So back in that 2009 timeframe, our first investment was May 10 in Sound Innovations at White River Junction. And this was designed to be a revolving fund. It has some restrictions on size companies that we can go into. They need to be under 3,000,000 in revenues for the last twelve months to be eligible, but most of them are under $1,000,000 as well. And there's some restrictions on how many people must be employed in Vermont as part of that team to qualify. So that's been going. That was a report that was sent to you a couple of weeks back that you may have access to. Overall, the goals for that fund when we all launched it was to make sure Vermont was no longer one of seven states that didn't have some sort of early stage equity program to help that type of company. We succeeded there. We'd hoped to support 18 companies during the first ten or eleven years of the revolve. We're now 36 companies. So money goes out, we lose a bunch on some, and then we earn a bunch on some. And that's what we try to optimize and mix for. I think it's important to talk about when a company returns capital, right? Sometimes the narrative is, Oh my gosh, they're sold. They're gone. Okay, that can happen, but that is not our experience. Usually the team, the tech, the tightness of the operation is at such a scale that they stay. So they're moving. It can happen, but it hasn't been the experience in Fund one by any means. The ownership of that fund is really VIDA, which got the appropriated money. They're about 70% owner. And then BSET, we put in $1,000,000 at this point as well. This year, we had to write down some unrealized gains that we had accumulated, I'll call them paper gains, and a couple holdings just because there were some dramatic changes around the election that we had to just reset. We still feel directionally employment's growing, wages are growing at these companies, but market value is going start to catch up as some of these ones, particularly in the energy sector, rebound as well. The fund zero is actually a neat opportunity. We're starting to see more interest in people paying it forward and back. They make a lot of money somehow or they want to say thank you or do estate planning, that we may start to flex and make people more aware as this is an opportunity. It's almost like an endowment for entrepreneurs. I think that would be an interesting thing for us to think about as we go forward. Sorry, took so long to talk about companies. I love talking about companies. So interrupt me or just, Mr. Chair, just say, Move on, Dave. Does anybody recognize any names up here? Yeah. Think ones that are kind of interesting. Right now, we have five companies and we've put money and capital into in Washington County, which is really, really neat. And they make stuff. There's one medical software company called Apraxis Health Solutions based out here in Montpelier. And they do medication therapy management for health plans, Medicaid plans, things like that. I think we're in five or six states right now. And we think we've got a pretty compelling solution for Vermont as well as they look at this rural health expenditure as well. And that's been really fun to see them scale and grow. The Cannatrol is a really interesting control technology company, environmental company. Their technology is all around HVAC systems. It really gets to potting dry organic leaves the right way so that you optimize yield, quality. There's no mold. The use case they started with was gas grill cheese and meats. Then they said, Oh, there's this thing around cannabis that people were growing and needed to produce. And then there's other high value organic materials. So things like seaweed are being evaluated for use as cattle feed. Because it reduces methane gas, produces cow in dramatic ways. So Core Tech with a couple different markets. And I think they've got a little over 20 people in North Springfield at their plant and a really neat husband and wife team as well. Resident Link Medical, this was a carve out of a company called Resident Link that had a logistics side and then the original medical side. This is a company that we finally were able to invest in. And they do wireless charging for things like pacemakers, right? Or like my father-in-law with Parkinson's got some sort of neuro link device. This is how you recharge things. Because right now, when your battery wears out, they got to cut you open again. Take it out, put it in. Expensive, intrusive, all sorts of risks. So this is the most exciting little company based here in Burlington, Switzerland, outside of Boston, and I think California is the other one. So the message here, teams are everywhere. But we're getting our Vermont share by and large. Rigorous. Does anybody like robots? Like, wow. So this is Diane and Colin Riggs, who gave me a call and said, Hey, can we meet for a beer? Over COVID. And we went to that cute little place in Richmond and sat outside. And they said, hey, we want to take the next level. I've been doing agricultural products. Colin's been designing software for robots. We want to do our own thing. We see a market. So we said, heck yes. Let's do this. We're investors, advocates. I'm on the board there. And what we do is the dull, dirty, dangerous stuff. Loaders. How do I put boxes at the start of a manufacturing line? And then how do I take the finished boxes and stack them up and palletize them? And so either end of whatever you do in the middle is really what we're doing. And we do injection molding work and a few other use cases. Now we're in the software business. Their software is so robust that now companies that have purchased very large systems from the big global players have said their software is inadequate or we had to turn off the machines. Let's use yours. So we started with hardware, got our customers to sort of fund our R and D and growth alongside some small investor money, and now, we hope we're off to the races here for for something much larger and and bigger. So software, medical stuff. Verde Technologies is another one up in Waterbury Center. I think the sign says MTX Software. It was that software company that never came, but they got the lease. It's the old Carl Zeus Building. And what we do there is a thin film solar module using this mineral called perovskite. A lot of science to what the United EBM, National Renewable Energy Labs have licensed in. And again, what we're doing is almost it manufactures these modules that are super thin and flexible. So we're testing this year with the Leahy Center or the Leahy Institute. Like, how can we put this on barns? Right? Do it on the sheathing on the side or as a part of their replacement roofing system. So really nifty stuff, early stage, all of these things. Of you may recall I used to have wonderful brown, reddish hair, but now it's not because of a lot of these companies that we work with and invest in. Just on VSET here, just where our roadmap's taking us, we have a $5,000,000 ish SBA grant that we can put into additional real estate. It's something Senator Leahy procured as well on his way out. And it's really around incubation. So we've chatting with some of our long term partners and really other communities about what could be effective. And it's not going to be a multi year build project. There needs to be some kind of simplicity into it and sustainability of model just so it will help VSET support the organization for as long as it's needed. And then really, we're trying to continue to earn being the go to resource for founders to call and how to reach them in ways that are accessible. I think the biggest thing we did was five years ago now, we were like, No, we're not hearing from certain folks or the solopreneurs or you know, our engagement of women entrepreneurs that tailed off. We started looking at our website. Does it seem too jargony? Or what's coming across here? And we said, the heck with it. But now it says, come as you are with what you got, we don't care, Rather than come pitch us. And what happened was everybody exhaled. So we just come in and say, hey, show us your gadget, or why are doing this, or what do you hope to achieve? And I think that, again, has unlocked our world through conversation. So I hope we are able to do way more of that. We're doing founders dinners now around the state where we bring 10 people in, might bring in one of our board members. And we've got five board members that have built or sold, some multiple times, billion dollar plus companies. So there's a lot of horsepower that care about Vermont that volunteer this. So we're trying to bring this at a pace and scale we can sustain to different parts of Vermont. And I think this is my last slide, and then we can take your questions. 03/13 was our calendar year service. That February number was as of June. So 03/13 calendar was the no cost, one on one companies that we chatted with. 75% of those were entrepreneurs, and the balance were kind of others. Those might be investors or maybe a key faculty recruit that we were trying to help out with. Oddly, less than 10% of those are actually members in our physical coworking space. So that was just a perception out there that really that's that success of the platform, getting outside of your building. Talked about the Washington County, Addison County. We've been down in White River, Woodstock. The mural in Burlington, I don't know if people are familiar with on the bottom right here. It was pretty well graffitied up and dark and all that. And the community rallied, including one of our board members, to do a project this fall with a couple 100 people. And I think it was over $30,000 in paint and labor and all the artist fees to sort of just brighten the gateway. And what a change. I was not a believer that it was going to have that much change, but it absolutely did. So feel free to honk the horn if you're going down the street. It's across from Edmonds Middle School, right up from Memorial Auditorium. And I would say my impression of Burlington, given the main street now is drivable and it's less confusing, the police presence increasing, and some of the support increasing, that it seems to be rebounding a little bit from some of its lows. Then And I want to thank this committee and the state for its support. The Agency of Commerce, Department of Economic Development provides us with $100,000 a year base operating grant that allows us to literally build this platform and get out the door. The fear of mine and the fear of some is that we just sit in Burlington and we never leave. And I can tell you that's not the case. It's not who our team is. That's not what we've done. And we're trying to find new ways to do that so we can hit the most people with what they might need and manage the hours we have with a team of four. So, we've eight thousand hours. How do we spread that across the state to try to help? And again, thank you for that. It's been twenty years, doors open. We quietly just sort of thanked as many people as we could this past year, and we're stoked to see what the next decade or twenty years brings. We deserve to be in existence, still helping people, still listening so that we can try to match it. And, oh, by the way, Inc. Gave us another power partner award. That's Emma, our community manager. And that was really neat to see some sort of national recognition because we're a little paranoid that we're not we can maybe keep up in Vermont, we're competing in a big world. And I think that was really a nice endorsement for our partners. And that's who our partners are. Right there. It's been a secret to our success to get a few people for the long term that play to win. And it's allowed us to then direct maybe one year support that come from banks or individuals towards some of our other partners to say, You know what? Why don't you support the generator this year? Because they need that. Or we're trying to stand up due north for help them with some program. And I think that's been really, really neat. And so thankful to all. And you all are part of that Vermont circle there in the middle. I think that's my overview. I don't know how awful it is for a 09:00 meeting. But happy to, like, take any questions. I I love Vermont, and I wanna see it do a lot better. Okay, David. Questions?

[Unidentified Committee Member]: I'm just thinking, have you done any sort of communication or partnering with the CTEs or the, you know, the high schools? Because I'll tell you, I had opportunity at a meeting where we had a, we went to some of these maker spaces. Some of these kids have some brilliant ideas. And I'm wondering if there's any plans or any way that we can capitalize on that.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: So I'll actually have two ways.

[Michael Marcotte (Chair)]: Yes,

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: the career technical education, principally involved in that through my board roles with Cinosure and GBIC and the Vermont Business Roundtable. So we're trying to do some, I would call it, let's supersize the CTE options for youth. We don't have specific programs in there. High school has been a little trickier one. We probably have five or six high schools that come through to meet and just sort of talk about their entrepreneurship course or what they're studying. We get a lot of high school and college students that might have investment clubs or robot clubs. We're suckers for robot clubs. The Rutland Rattlers. They send their almost crayoned ask every year. And I'm like, Yes, Milton has done it. I forget the other ones. But, yeah, usually a few of those a year. We're at overcapacity and serving college students at the moment, so it's really tough to reach down to high school. And plus, the high school is a little bit more captive to just around our Burlington location. But we're always hoping to try to figure that out. We offer our resources to anybody. Like, the perks are available if you're a team developing something in high school. Like, we don't have a problem with that. There have been some really, gifted or very intentional high schoolers that we've been able to place in internships as well, with some companies. It's kind of weird when literally, mom drops their child off to go code with the team. That's on the team to work out those logistics. Thank you for that question. We have four investment clubs working out of our facility now. There's no charge, actually, for students. I don't know if I said that before. So, our membership right now is about 150. That's our size. Of that, I think it's 35 or so of our students. There's always a waiting list for students. And it's free if they go work for a company as an intern or employee or they have their own startup or they come with their investment club. So, St. Mike's, Champlain, UVM, and whatever the other one is flow through there now and talk about investing into startups or into the stock market. It's just as one example.

[Abbey Duke (Member)]: Abbey Duke, by the way, from Burlington. And I love the mirror. I drive by it all the time.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Oh, Duke, thank you. Right, Nicole? Yeah, it's

[Abbey Duke (Member)]: very cool. I'm interested in a needs assessment from your perspective. Needs assessment? Needs assessment, yeah, just in terms of support for founders and for startups. Do you feel like, like you mentioned that you've got some waiting lists, you're at capacity, I'm just kind of curious, capacity wise, how you feel, like you're able to meet, generally speaking, the needs and interests? And then my second question is for those folks who don't fit the tech or your do you have just some thoughts on the gaps in Yeah.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: We take the call with just about everybody. And we generally try to listen and get them. So I tell our team, Hey, we want to be the most helpful. Get me an answer. Just don't push me around. Right? And so I think through the years, we've relied upon the Center for Women in Enterprise, CWB, the SVDC score has been really helpful for more longer term coaching or business modeling has been great there. I don't see any capacity constraints for that segment. I will say the one on ones that we have a year, I think we peaked at three eighty eight maybe two years ago, and that was too many. Alright? I felt like there was We were talking and meeting a lot, but we weren't doing the second, third sort of check-in. Like, when the phone doesn't ring, that's when I'm like, What is The silence is deafening. Used to tell my kids. And that has been an intention of ours. Let's dial it back. Use our partners to lever them around the state. Go to the local hubs that had been built up was the other advantage. We could send them down to Moe's in Rutland, for example, for some help. Or maybe the Mint was a better location. I am fearful as some of those sort of retrench or go away once grants occur. Like, what do we do with those folks? And we're trying to get this platform in place. I don't have an answer. I don't have like, oh, there's unmet demand. I just know it's, I track how many weeks it takes to have a phone call with one of our team or a meeting. And it's not three weeks or a month. It's usually within seven, ten business days, which is fine. And then how many people are maybe coming in looking for money if they're at that place versus just advice. So I think where needs are, I'm really impressed with what Adam Grnold Southern called the Southern Cone down there have been pulling together. It's really exciting. And I think they're getting the support and the mentoring in there as well. So There's a lot going on. I think it's been confusing, too. Like I mentioned to Monique Priestley before, we went through what I'll call it, peak accelerator, a peak hub. We started a lot of them largely with some federal dollars that became available, and not all of them will sustain. Right? But where we sugar off to is still going to be above where we started. So instead of 10 or 12 vibrant, sustainable places, we get down to seven, eight. And I'll take that, because they're not that far away from each other in most instances. Questions?

[Edye Graning (Vice Chair)]: One of the things that this committee so sorry, Edye Graning and Jericho. One of the things that we have been talking about a lot in this committee over the years is incentivizing business growth in the state, and you're doing a lot of that. And we talk about Veggie and how that works and doesn't work for today. I'm curious if you have thoughts, if you have put time into thinking about what other things the state can do to support Vermont business and Vermont business growth.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Great. Thank you for that question. I think about it on different levels. I'm president of Vermont Technology Council and some of these economic development boards too. Veggie So is the only club in the back, and we need the reauthorization. I think it's up for review again here. It's not perfect, but honestly, doesn't need to be perfect. I still think it's a big company or a bigger company program, which is fine. I'm also encouraged by SSBCI, the new venture funds that are forming as well, that'll be a good amount of capital in a short period of time, which is difficult to do, right? But I think that will have profound long term benefits for Vermont. So that's another tool that I think is good. I think where we're short is, you know, we need some sort of lending vehicle that is a little bit riskier, and it's almost like receivables financing to a company that's not factoring, which is like a 20% charge, but it might be a 12% fee to lend a company, I don't know, dollars $05,000,000 so it can buy that amount of equipment to sell to the federal government, which we know we'll pay in two twenty days. So that's the barrier to sort of, I would say, the next wave of growth. Okay, there's many companies that are sort of in the $5 to $20,000,000 range right now that made it through the gangly startup years. Still might not be pretty enough for a traditional bank loan. They've got assets, people. They can go from 20 people to 40, but this is what the barrier is. And I've had discussions with Peter about that sort of And I don't think it's particularly risky, right? But it's just different. You're lending on the credit of the purchaser, Right? So if the US Marines say they want to buy something, you could probably count on them if you can do it. You're not taking risk in developing. It's purely working capital. And raising equity to do that is really expensive and dilutive to the teams. So I think that is one. I don't have full thinking on this either, but I do feel like the Vermont training program, That used to be really accessible to smaller companies. So that was a club in the bag that was very helpful. I think that one, again, allows, Hey, I've to hire two people. The paperwork is worth it versus meaning time to the entrepreneur or for the founders. I think that's a program that could be scaled a little bit more for smaller employers, more so than a payroll, a veggie type of process. I think the things that would impact most is just be I would say get testimony and be cautious about just more general landscape issues. Things to do with like, I go back to the cloud tax discussion that was fifteen years in the making, whatever it was. And sort of the consensus at the time was like, all right, let's yes. But until we see New York, California sort of adopt a standard, we better not be an outlier because it puts our companies and our teams that can move anywhere at a disadvantage. And I think we've got some issues around what AI is or isn't, how we regulate that, are data centers good or bad, right? All those things. So I think as those inevitably come up this session, just please invite in some of the smaller ten, twenty, 30 employer companies to see if that might have some unintended consequence. Because I do think, as a whole, we've made a lot of progress. I feel better than ever about the future. We've got Ada's IPO as a signature event and their growth, right, and their search for sustainability. This massive redevelopment proposed in Killington quite literally changes the middle of our state if happens. And there's probably 50 businesses, some of which I showed you there that are gonna be very successful. Okay? And it will take them a while. And they will get to a point where they're ten or fifteen or twenty years and then they will sell. The market changes or founders want to retire or whatever. I And used to be fearful of that, but then I was like, wait a minute. We're likely to see 100 year old companies starting, but maybe we get five twenty year old companies. And the velocity and the change of the people, the capital, the knowledge, the brand as a place to start, scale, succeed, thrive here with a lot of ownership, we think is where we can win and go forward. So I don't know if I answered that specifically, but yes, on Veggie, for sure.

[Edye Graning (Vice Chair)]: Yeah, so I guess more broadly, as you see gaps, it's really gonna be helpful for us to understand where we could be providing better supports to businesses. And I appreciate the thinking about, for what a Vermont company looks like, if we're never going to be the manufacturing hub of The US or whatever it is, right? But we can be the brainpower to start some of these ideas. It's just thinking about who we are and where we're providing the kindling and where we're doing those kind of supports. And so I think that's an interesting thought process for us to

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: have. And I got to that after my years in commerce. I want it all here. It used to be put the chip plant in Essex versus Armonk or whatever. Then along the way, I was like, know, the conjunction's different. It's not or, it's and. Right? Because we can't scale a company very quickly if they've got really niche jobs. We couldn't produce the workforce enough. So we need to get comfortable with being a competitive domicile for a portion of the company that we're really psyched and proud of, that pay and benefit well, that don't destroy our environment and all the rest. But it's unrealistic to think that we could bring 3,000 people in quickly to one company without having other outposts. And I think that changed my thinking when I was still doing policy work or some of our other programs. And I don't see the world changing. It's here and there.

[Michael Marcotte (Chair)]: Hello, Ben.

[Jonathan Cooper (Member)]: Good morning. Hello, David. I guess part of what you were just describing sort of pertains to the question that I have, and perhaps it does, we'll see. This pertains to the slides you had talking about the family of venture funds. The Vermont Growth Fund II LLC contained a bullet point about how there is no real estate recovery and resiliency benefit. You may have explained that in detail and I might have missed it. Would you mind describing for me what that means?

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Thank you for the question. No, didn't miss that. As a condition of the agreement with HUD, which is very much like a real estate sort of entity, we're like no, no fixed real estate with the capital that we would invest. So you couldn't buy a building with it, for example, or do a rehab. And that was so we didn't have to have companies go through an environmental review or whatever environmental assessment process, which would have been too long to syndicate other capital and all the rest. So that's why that's different versus Fund one. We can do real estate, so different sizes. So sorry if that's confusing. I can work on that.

[Jonathan Cooper (Member)]: But it does help clarify what you just mentioned about there's a stage that maybe Vermont is the most appropriate. There's a certain segment of a business or business' lifespan where we can outperform perhaps other potential locations, the armhunks of the world. But I am sort of thinking a little bit of how getting at that level and providing capital that does not have those anchoring elements, say, having to go through those reviews, NEPA stuff, it's also to think perhaps this allows these activities, which sort of seem Northwestern ish to how it can really get at a scale that makes sense for Bennington, for Manchester, maybe one day even for Reedsboro. But I'm sort of trying to follow the thread of what you're describing in terms of where VCENT can present Vermont's best advantages in a business's sort of life cycle. So thank you for clarifying that.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Yeah, is such a tough thing to think about with precious public dollars from Vermont. I suppose there's a bit more grace with federal dollars as to what's Vermont enough. I lived in the Upper Valley for a while, it felt like one community. And certainly Bennington, when our work with the Lightning Jar, when that was going, and some of the others, there's a lot of folks that of head toward the Albany market for their employer. There is no one magic answer. There needs to be a degree of trust with some sort of built in accountabilities. The promise is maybe not for every building or every employee being resident, but what is enough? Is it 51% for a period of time, but then as a company maybe outgrows? We have one company in our portfolio that the first 25 people were here in Vermont, then the next 25 were half remote. And now they're up to 130 people and there's probably 40% of those here. So it just changes over time. And that was one that wasn't with a factory or it was more software and services. So what do we have that might have helped them along the way? And that's kind of where I go back to that training piece. If we can help Vermonters get jobs through some sort of training, I don't know that I care where they actually drive to work. Is it in New York, New Hampshire, or are they right here in Vermont? But I know that helps their household earn the income they need, whatever they need to do in their life. So that would be something I'm curious how other smaller states and smaller regions of the country deal with that. I don't know.

[Emily Carris Duncan (Member)]: I'm curious Emily Carris Duncan. I'm curious to know I know you've all gotten some federal funding. But do you have any issues gaining access to federal funding? Are there any hurdles in gaining access to federal funding?

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Yeah. When I started VSAT, we were 99% federally funded and irrelevant. So, it wasn't the solution we thought it was. And we worked really hard to get toward earned income and into buildings or other few partners along the way. And then we hadn't had a dollar in federal money until maybe two years ago, when this last round of senior lady supports came through. To date, no, because they've been earmarks. But I'm nervous. One of the grants, we were forced to draw it all down. So at least we have custody of it. And then another is on a as reimbursed or drawdown per investment basis. So that is a risk. It's something we've had to disclose to companies to say, hey, this is what we want to do and our other co investors. So it's not ideal. But I think there's enough history and trust we do it. And honestly, the system's working much better and faster.

[Emily Carris Duncan (Member)]: Yeah. I'm interested in SSBCI, your thoughts and maybe things our committee should be aware of to build in the capacity to really take advantage of that

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: program, the money. Visa was part of this with the agency and VITA and sort of making a case to Treasury back in the day. We ultimately didn't proceed with the allocation that we had been assigned via RFP. I like where it's going. It's going to get out there. It's got a lot of changes and uncertainties. I'm not sure it's a widely admired program in Washington right now. But the great news is that Vida did a fantastic job of calling in the funds, lending out more quickly with that that allowed them to pull in the equity. We have co invested with one, two, three of the SSBCI funds that are out there so far. So it hasn't been a barrier that I've seen for private capital or even in state. But several of them are new entities, and it takes a little bit to sort of get up to speed. The first time's the first time, right? And once that gets up. But I do think long term, I can't wait to see what the results are. With the seed fund one that's been around since 2010, like, gosh, we thought the leverage on that, I think when I was pitching it was maybe for every dollar this fund put in, we'd see $2 in private money for leverage, right? So we get $3 total, but our experiences at the initial check were well over 10 other dollars alongside of us, And then lifetime, it's well over $75 So if they can do better than that or half of that, wow, I think that just gets more risk capital in the system. There could be some impacts on competition for people and wage inflation. So there's winners and losers for sure. But I think on the whole, we just need another 10 or so companies a year that make a headline for the right reason. Right? And I think that changes the narrative. And we all see that. And that it's only three and a half hours from top to bottom here. And so word gets out. And I think that'll be really exciting.

[Michael Marcotte (Chair)]: David, thank you very much for joining us this morning.

[Dave Bradbury (President, Vermont Center for Emerging Technologies - VCET)]: Hey. Thank you all. And, you're invited up to Burlington anytime. So just I'll be in a t shirt, though. Thank you all very much.

[Michael Marcotte (Chair)]: Thank you very much. Subcommittee, we're two on the floor. We have pictures, five, three, four. Then we have a training, lots of them back here at 01:00.