This is applicable for anyone near Silicon Valley within a 200 mile radius, later to be expanded to the rest of the country.

Two or more engineers, consultants, students,  or new graduates get together. They are all excellent professionals who were most probably laid off, or at least are worried about how to get a job in the high-tech industry today. They come from top notch high-tech companies like Ebay, HP, Google, Sun, SGI and so on. The students come from U.C. Berkeley or Stanford University, until now considered a sure passport to get a job, and are now trying to get into the work market.

They get the opportunity to present a brief summary of their new ideas (for example a slide show with a brief business plan). Then they receive from the federal government program at least $ 250,000 to make their early start idea suitable for investment by the world-famous and now relatively inactive early stage venture capital establishments of Silicon Valley. The rate of the award from a government sponsored program  could be as high as 50%. It means from two applicant teams, one gets approved. The goal is to have a prototype, a customer trial and to show interest from about five companies. Then, the early stage Silicon Valley VC community will become alive and the most important portion of the risk has been removed by a Government program

The idea originally comes from Israel, where a similar program has generated 100 Israeli companies listed on NASDAQ and 75% of Israel's $70 billion in exports to come from high tech products.

With hundreds of thousands of technical experts laid off by larger companies, such a law will capture the brain and create jobs.

Let's assume 20,000 requests are handled by this early stage federal government program. 10,000 starts receive the $250K funding. This is $2.5 Billion plus about 10% administration costs. This amount is peanuts (0.3%) compared to $1 Trillion for health care reform.

How can this pay off? Assume only 10% of the companies funded are successful. That is 1,000 new companies are created. Let's assume 9% (900 companies) will have an average of 200 employees each and 1% (100) will have an average 1,000 employees each.

The total number these companies will employ in high quality, well paid jobs is 280,000. This is larger than the number of people laid off so far on Silicon Valley. Thousands of ideas stagnant in a large bureaucracy from industry's giants, will come to life and make money magically , from ideas, from apparently nothing but brains.

The brains are here. We need the money to collect the intelligence waste and make it happen. Other countries have oil, we have the educated brains, here on Silicon Valley and elsewhere. 

The valuation of the 1,000 operational start-ups, let's assume can be $50M. Some companies may reach 5 Billion in value, some almost nothing. This means the value created in stocks is $50B, If the Government keeps 15% equity in each of those start up, the total value of start-ups owned by feds is 7.5B.

This will nearly triple the $2.8B initial investment.

How and when do we start?

Miha Ahronovitz