From Indiana, a Case Study of an Ambitious Foundation-Backed Push to Spur New Prosperity

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One of the toughest challenges that foundations are grappling with is how to spur more economic prosperity—especially in parts of the country, like the Great Lakes region, that have experienced steep jobs losses due to industrial decline.

We’ve been following a number of funder-backed efforts to generate growth and opportunity in the Rust Belt and other hard-hit parts of the U.S. Some of these efforts are piloted by national funders, like JPMorgan Chase. But most are supported by foundations with deep local ties. And many involve creative partnership with a range of stakeholders and lots of moving parts.

A case in point is an economic initiative that the Lilly Endowment is supporting in its home region. New technology is making agriculture and manufacturing more efficient and the Lilly Endowment wants to make sure that Indiana businesses have those tools at their disposal.

Last month, the endowment announced it will provide a $38.9 million grant to the Northwest Central Indiana Community Partnership to assist the Wabash Heartland Innovation Network develop a plan to foster a prosperous economic ecosystem in 10 counties in northwest Indiana.

The WHIN aims to make the 10-county area a global center for agriculture and next-generation manufacturing using the sensor-based network of devices known as the Internet of Things (IoT).

IoT connects a wide range of services, products and devices to the Internet. It is a growing resource for companies seeking data they need. For example, it can help manufacturers track inventory, speed up deliveries and schedule equipment maintenance.

The Lilly grant provides five years of funding and work will begin this year.

The strategy emerged in 2016 as a result of community meetings and planning sessions, as well as the “Strategic Plan for Economic and Community Prosperity in the Wabash Heartland Region,” which was prepared by Battelle Technology Partnership Practice.

“WHIN will achieve its vision of becoming an IoT technology center by harnessing the strengths of the area’s manufacturing and agricultural leaders with Purdue University, community foundations, Ivy Tech Community College, AgriNovus Indiana and other area stakeholders,” said Gary Henriott, chair of the WHIN board of directors.

The effort and the report identified the region’s three critical economic drivers—next-generation manufacturing, high-tech agriculture and Purdue University. The Lilly Endowment funded the planning for the project.

The decision to focus on IoT was supported by research about the projected global impact of the technology in the next decade. Research from Deloitte in 2015 indicated that by 2025, some 25 billion IoT devices will be online.

WHIN’s plan, “Creating a Prosperous Economic Ecosystem in the Wabash Heartland,” details how it will coordinate initiatives using IoT.

WHIN plans to work with Purdue University and Ivy Tech Community college to build testbeds for the development of IoT applications in agriculture and manufacturing. It also will establish training centers to educate students and retrain workers, as well as provide additional support for Purdue’s Birck Nanotechnology Center.

WHIN also will establish a regional initiative fund to provide grants to connect leaders in manufacturing and agriculture to IoT experts and university researchers and to enhance the attractiveness and livability of the region.

As noted earlier, bringing together key stakeholders is often a part of foundation-backed economic development initiatives. This is something that foundations are good at, with their bird’s eye view of who’s working on key issues and their ability to bring new money to the table. Local universities are often a key part of the mix in these initiatives as the suppliers of human capital. We’ve seen a lot of funder-backed efforts to better align skills building on campus with the needs of local industries.

“We share the goal of making this region an international focal point for agriculture and next-generation manufacturing,” Purdue President Mitch Daniels said. “Building the Indiana economy—by attracting existing business, creating brand new businesses, or recruiting and developing topflight talent—is absolutely central to Purdue's mission.”

Another strength of big foundation money of the kind that Lilly is providing here is that it can leverage other funding and catalyze a concerted push that draws in smaller foundations.

Lilly Endowment’s grant will help WHIN establish something called the Regional Cultivation Fund, which will make matching grants in the region. Henriott said that “Community foundations are critical partners. They will be instrumental in helping to secure additional support for the initiative....”

So there are a lot moving parts with this thing. And while it’s too early to say how well they’ll actually work together in practice, the collaborative ambitions on display offer a case study in what sophisticated, foundation-backed regional economic development initiatives look like these days.

Ace Yakey, Lilly Endowment’s vice president for community development, summed up this push to connect the dots: “WHIN is positioned to encourage synergistic collaborations among Purdue University, Ivy Tech Community College, AgriNovus Indiana, and the region’s community foundations and businesses. All of these groups have exceptional strengths and resources to contribute to advancing prosperity in northwest central Indiana…”

Yakey brings his experience as head of the Indianapolis Economic Development Corp. to the new project, so he knows the key players here—which bodes well for the initiative’s success.

As we’ve reported, the Lilly Endowment funds activities outside its home state, but the core grantmaking of this huge foundation—which last reported assets of over $10 billion—has focuses in Indiana, a state with 6.6 million people.