According to an announcement from the White House, the coordinated public/private effort brings together an alliance of the country's most innovative entrepreneurs, corporations, universities, foundations, and other leaders, working in concert with a wide range of Federal agencies to dramatically increase the prevalence and success of America's entrepreneurs. Startup America is an important element of President Obama's overall innovation strategy.
The core goals of Startup America are to increase the number of new high-growth firms that are creating economic growth, innovation, and quality jobs; celebrate and honor entrepreneurship as a core American value and source of competitive advantage; and inspire and empower an ever-greater diversity of communities and individuals to build great American companies. The White House said startups bring a wealth of transformative innovations to market, and they also play a critical role in job creation in the United States. Those entrepreneurs who are intent on growing their businesses create the lion's share of these new jobs, in every part of the country and in every industry. Moreover, it is entrepreneurs in clean energy, medicine, advanced manufacturing, information technology, and other fields who will build the new industries of the 21st century, and solve some of our toughest global challenges.
The White House announcement said the Startup America will: Expand access to capital for high-growth startups throughout the country; Expand entrepreneurship education and mentorship programs that empower more Americans not just to get a job, but to create jobs; Strengthen commercialization of the about $148 billion in annual federally-funded research and development, which can generate innovative startups and entirely new industries; Identify and remove unnecessary barriers to high-growth startups; and Expand collaborations between large companies and startups.
Some of the new initiatives and incentives to encourage the private sector to invest in new startups that were outlined include:
- The President's new budget will propose making permanent the elimination of capital gains taxes on key investments in small businesses, which was passed as a temporary provision in 2010 as part of the Small Business Jobs Act the President signed in September. The budget will also propose expanding the New Markets Tax Credit to encourage private sector investment in startups and small businesses operating in lower-income communities.
- The Small Business Administration (SBA) will direct $2 billion in existing guarantee authority over the next 5 years to match private sector investment funding for startups and small firms in underserved communities, as well as seed and early-stage investing in firms with high growth potential, through its Small Business Investment Company (SBIC) program.
- Together SBA and the Department of Energy will boost high-quality mentorship for cleantech startups, while the Veterans Administration is launching new training programs for Veterans who want to start new businesses.
- The Department of Commerce will expand the i6 Challenge to help foster the commercialization of clean technologies, and are finalizing a plan to allow entrepreneurs to request faster review of their patents, an initiative that should lower patent pendency times overall and speed the deployment of new ideas to the marketplace. [Note: the i6 Challenge is a $12 million program to identify and support the nation's best ideas for technology commercialization and entrepreneurship in six different regions of the country].
In addition, a number of private sector and philanthropic commitments are being announced alongside the launch of the "Startup America Partnership. For example, the Charles Stewart Mott Foundation will fund an initiative that will create a Virtual Incubation Network at America's community colleges led by The American Association of Community Colleges, in partnership with National Association for Community College Entrepreneurship. Virtual incubator models will be tested at ten community college locations in the country.
Also, JumpStart Inc., a nationally recognized non-profit venture development organization based in Cleveland, Ohio announces JumpStart America, a new national initiative to build robust public, private and philanthropic partnerships to create or accelerate regionally-based innovation and entrepreneurship programs. Most importantly, these efforts will accelerate the efforts and economic impact of thousands of new and existing firms across the U.S. and create hundreds of thousands of new private sector jobs in the next four years. Funders of JumpStart America's initial work include the John S. and James L. Knight Foundation and the Surdna Foundation, which are supporting a $40 million effort to accelerate regional entrepreneurial ecosystems in Ohio, Indiana, Michigan, Minnesota, and New York.
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