Washington DC’s Developing Support for the Startup Ecosystem

By: Marianne Hudson, ACA Executive Director

Last week I had the pleasure of attending the board meeting of the Center for American Entrepreneurship.  This non-profit, non-partisan organization provides education and advocacy on the critical importance of entrepreneurs and startups to innovation, economic growth and job creation to America’s policymakers.  CAE has advocated for several issues that ACA cares about.

CAE has a high-powered board of directors, with startup ecosystem players from across the country, and brings the board together with truly leading policymakers – US Senators, SEC Commissioners and White House representatives, just to name a few.  It is a great chance for a group of leaders to provide ideas for healthy entrepreneurial growth and learn about their thinking.

While we got disappointing news about the continuing partisan divide in Washington, DC, we also got some great news about policies and activities that support the entrepreneurial ecosystem – and I learned even more the following day as I held a couple Capitol Hill meetings.  Bottom line, many really care about startups and are acting to build a healthy environment for company growth:

  • The US Senate is establishing a bi-partisan “Entrepreneurship Caucus,” led by Sen. Tim Scott (R-SC) and a former entrepreneur himself and Sen. Amy Klobuchar (D-MN).  Perhaps this will help the Senate pass legislation related to capital access and taxes for startups.  Sen. Scott’s comments showed a passionate commitment to supporting entrepreneurs and in underserved communities.

  • Commissioner Hester Peirce told us that the SEC is focused on expanding the pool of accredited investors, I’m guessing by allowing more categories of financial sophistication to be accredited investors.  Since ACA has had to fight in the past for the Commission to not increase the financial thresholds for accredited investors, this is a nice period for early-stage investors and the companies we invest in.

  • House Republicans have put out a framework for “tax reform 2.0” that includes a focus on “Growing Brand-New Entrepreneurs” and said they planned to mark up a bill on this on September 13.  I participated in a coalition meeting with NVCA, BIO and AdvaMed, with top staff from the Ways & Means Committee to promote our tax issues, spending an hour with this team (that’s a lot for a Capitol Hill meeting).  It is not clear how much of our “Section 1202” and “Net Operating Loss” issues will be in this bill, but it is promising to see the framework includes allowing new businesses to write-off more of their startup costs and also to bring in new investors without triggering limits on their access to tax benefits.

  • The National Economic Council, a part of the White House, is considering an initiative to support the country’s entrepreneurial community.  They actively sought ideas from the CAE board.  If you have ideas you’d like me to provide to these leaders, please let me know.

I’m encouraged that so many parts of our Congress and Administration are interested in supporting startups and recognize their contribution to our economy.  With a partner like the Center for American Entrepreneurship, here’s to accomplishing new policies and activities for startups in the coming year!


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