While it is relatively cheap to get a web
startup off the ground these days, other industries aren't as lucky.
Take green-tech or medical technology for instance; at TED this year Bill Gates said that
the minimum investment the world needs to create sustainable
eco-friendly renewable energy is "only" in the range of hundreds of
millions of dollars - and that's just to get started. It's industries
like these that require Angel and VC investments at the early-stage
level to get significant innovations off the ground, and a government
tax credit proposed for angels in Minnestoa could encourage them to dole
out more cash for high-tech ventures.
Earlier this month in St. Paul, "witness after witness" spoke in support of a bill that would create $32 million in tax credits available to angel investors, writes Thomas Lee of MedCity News. "Entrepreneurs, investors, university officials, industry groups warned lawmakers that the lack of early stage capital meant innovative start-ups in Minnesota would either die or move to another state," Lee adds.
With a growing community of medical innovation, Minnesota is attempting to play catch-up with its neighbor state Wisconsin whose similar tax credit has provided rocket fuel for innovation. Lee quotes a report from the Wisconsin Angel Network which says that angel investments and number of deals tripled in the first three years of the state's program. He adds that three bio-tech spin-offs from the University of Wisconsin were bought for more money in the last three years than in the last 25 years of Minnesota-based university spin-offs.
"VitalMedix Inc., a promising drug company from the University of Minnesota, recently moved to Hudson, [Wisconsin]" Lee says. Hudson is just across the Minnesota/Wisconsin border less than 20 miles from St. Paul. "Miromatrix Inc., based on the work of Dr. Doris Taylor, warn they will leave the state if they can't find angel financing."
STATE ANGEL CAPITAL TAX CREDIT PROGRAMS HAVE PROVEN TO BE AN EFFECTIVE STIMULUS FOR PRIVATE INVESTORS TO INVEST IN INNOVATIVE ENTREPRENEURS.......WITH THE GROWING "VALLEY OF DEATH" INVESTMENT GAP MORE STATES NEED TO ADOPT THESE PROGRAMS AND INNOVATION AMERICA AND NASVF ALSO HAVE MADE A RECOMMENDATION TO THE OBAMA ADMINISTRATION TO DEVELOP A NATIONAL ANGEL CAPITAL INVESTMENT FEDERAL TAX INCENTIVE PROGRAM TO HELP ADDRESS THE EQUITY CHALLENGES FACING OUR INNOVATIVE ENTREPRENEURS IN AMERICA..THE TIME TO ACRT IS NOW OR WE MIGHT LOSE A GENERATION OF ENTREPRENEURS CRITICAL TO THE INNOVATION ECONOMY IN AMERICA......!
COMMENTS BY RICH BENDIS OF INNOVATION AMERICA AND EDITOR OF innovationDAILY
To read the full, original article click on this link: Do Tax Credits for Angel Investors Boost Innovation? - ReadWriteStart
Author: Chris Cameron
