White House Teams Up With Industry to Boost U.S. Entrepreneurship

New White House initiative, Startup America, is designed to support and celebrate U.S. entrepreneurs.

Money_TreeFollowing up on President Barack Obama’s State of the Union pledge to focus on American competitiveness and innovation, the White House announced the Startup America initiative, a program to support and celebrate U.S. entrepreneurs. On Monday, a panel of cabinet members, White House officials, executives and economic development leaders provided an outline of the public/private effort, which has already generated $400 million in private commitments. Startup America aims to expand a number of federal programs to provide capital and mentoring services to entrepreneurs, and to create a nationwide partnership that will leverage private sector partners to provide entrepreneurial support resources. The initiative also will support the expansion of several existing TBED-related initiatives across the country.

The Obama administration plans to commit $2 billion to encourage private sector investment in early stage and potentially high-growth companies over the next five years. Two new programs, administered by the Small Business Administration (SBA), will use the operating infrastructure of the Small Business Investment Company (SBIC) program to match private capital raised by investment funds to invest in promising businesses at no new cost to taxpayers. The $1 billion Impact Investment Fund will offer a 2:1 match to funds that invest in high-growth, high-tech companies in underserved communities. SBA’s $1 billion Early-Stage Innovation Fund will provide a 1:1 match to private capital raised by early stage and seed funds.

As part of the initiative, Treasury will expand the New Markets Tax Credit program and will hold a conference in March to seek input on how to simplify and streamline the program. Treasury’s New Markets program would be funded at $5 billion, up from $3.5 billion, to spur investment in lower-income communities. In addition, the administration plans to recommend in the FY12 budget making the capital gains tax exclusion for certain small business stock permanent.

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Source: SSTI Weekly Digest