The purpose of the Startup Act is to “jump-start economic recovery through the formation and growth of new businesses.” According to its bipartisan sponsors, another purpose of the Startup Act is employing Americans and fostering research and development in the United States. This is according to the Startup Act sponsors, Senators Jerry Moran (R-Kan) and Mark Warner (D-Va.) together with Senators Roy Blunt (R-Mo.) and Amy Klobuchar (D-Minn.). In passing the Startup Act, the overall aim was to help boost the growth of startups to create more jobs and economic opportunity in the United States.
With the promise of improvement in the regulatory processes at the federal and local levels, and modernization of the critical Economic Development Administration program promoting innovation and the progress of the economy, the Startup Act sees that government red tape is a key barrier that inhibits the launch and growth of new businesses in the United States.
“For years, we have pushed in Congress for commonsense legislation to encourage entrepreneurship and help startup companies grow and thrive,” Senator Warner said. He adds that this bill draws interest from young entrepreneurs and new innovators that would help and progress the country’s economic growth.
Significant expansion to the Regional Innovation Strategies program has also been made with restoration of the program’s funding, increasing the funding level to $100 million. Funding from this program brings more sponsorship dollars to support new research, solutions and innovations across a variety of industries, throughout the United States.
The expansion of the Startup Act also allows the extension of the funded project timeline to five years and divides programs into groups to focus mainly on outputs rather than processes. The duration of the program is also extended until FY 2024 and aims to have more aid and support to the new businesses as assessed by the Department of Commerce.
The new provision in the bipartisan Startup Act also believes that through nurturing university research and other venture development organizations’ initiatives with the use of federal research funding, it will in time, bring new innovative products in the market and boost the competition in the American economy. University research is a key driver of innovation and startup growth.
Also, with this legislation, immigrants with advanced STEM degrees and high business education will also be provided with visas so they can stay in the country legally to develop new ideas and use their talents.
The Startup Act is also confident that it would bring more impact in creating more jobs. Instead of Americans leaving the country to look for bigger opportunities abroad, according to Moran, Congress must work to retain these talents in the United States and support policies that enable people with ideas to thrive and create products for the market –more business opportunities creates more jobs.
Most of the concept in the reintroduced bill is based on a research and analysis done by the Kauffman Foundation, which also supports entrepreneurship in the United States. According to the foundation’s latest study, there was a decrease in the number of new entrepreneurs in the US from 0.33 percent in 2015 to 0.31 percent in 2016.
Senators urged Congress to support the new bill to be considered in the Senate to bring growth and encourage financial and skill investment in the country. You can read the full text of the Startup Act here.
Interested in learning more about how your startup or small businesses can benefit from the provisions of the Startup Act? Contact me today and let’s talk.