Baldwin to reintroduce small business innovation bill
In what has been described by some as a content-free election season, a U.S. senator whose name is not even on the ballot this year plans to reintroduce a bill to boost small business innovation.
Senator Tammy Baldwin says the Small Business Innovation Act would help Wisconsin overcome its low startup activity and entrepreneurship growth rankings by providing small businesses the capital they need to grow their companies and create jobs.
“Wisconsin has a proud history of entrepreneurship and innovation, but recent reports show that we need to strengthen and support our ‘Made in Wisconsin’ startups and small businesses,” she states.
The legislation would use the Small Business Administration to leverage private venture capital to target high-growth industries such as advanced manufacturing, innovation, science, research, and technology. It expands the SBA’s authorization to provide up to $4 billion in leverage to small business investment companies. The SBIC program is designed to increase access to venture capital to small businesses by incentivizing the deployment of private-equity capital used to finance operations, growth, and modernization.
Baldwin notes that small businesses are the engine of the U.S. economy, but national reform is needed because Wisconsin ranks last nationally in startup activity and entrepreneurship growth. According to the 2016 Kauffman Foundation Index, Wisconsin ranked last in startup activity for the second year in a row.
Baldwin also says the legislation does something that Wisconsin’s state venture capital fund does not — it permits investment in biotechnology and the life sciences. Since the state has been a leader in these areas, “more must be done to seize the opportunity to harness and support these assets,” she states.
Business backing
The proposal received support from local business executives, including Kevin Conroy, chairman, president, and CEO of Exact Sciences. Conroy has been critical of Gov. Scott Walker’s budget cuts to the University of Wisconsin System, but praised Baldwin’s legislation while noting that not enough new businesses are being formed every year. “This is an opportunity to create and keep highly skilled, good-paying jobs right here in Wisconsin,” Conroy says.
Additional support was offered by Zach Brandon, president of the Greater Madison Chamber of Commerce, who noted that Greater Madison’s economy is driven by innovation clusters like biotechnology, research, and software publishing. “It is wise policy to maximize tools that leverage private investment to support the creation of more of these vital jobs in our economy,” he states.
The legislation requires qualified companies to be recipients of federal merit-based grants such as small business innovation research grants.
Tom Still, president of the Wisconsin Technology Council and Wisconsin Innovation Network, notes the recipients of SBIR grants are technology-based companies that have already demonstrated commercial potential and have survived a rigorous competitive process to win such grants, which removes some risk for investors.
“For investors, that means significant due diligence has already taken place and their risk is reduced because they are investing in companies with demonstrated potential,” Still says.
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