Madison, Wis. – As part of the next phase of his Grow Wisconsin agenda, Gov. Jim Doyle has announced Accelerate Wisconsin, a new initiative designed to grow start-up businesses.
The program will provide new funding and tax exemptions to support investment in new Wisconsin businesses, and build on the success of Act 255, a collection of tax credits, grants, and loans to support start-up companies and attract angel and venture capital to Wisconsin.
In announcing the initiative, Doyle said the goal is to accelerate the growth of new businesses and lure new investment to the state. “To grow Wisconsin, we must attract investment and support new high-tech, start-up companies,” Doyle said in announcing the initiative. “These businesses will create the bedrock for a knowledge-driven economy and produce the high-paying jobs of tomorrow.”
Accelerate Wisconsin features several measures that have been sought by lawmakers and venture capitalists, alike. It includes provisions to:
• Accelerate grant and loan programs. The new plan will double funding for current technology grants and loans, and direct $5 million annually to provide seed money to start-up companies and small businesses, and supply the matching funds required for federal research grant applications.
• Establish a capital gains re-investment initiative. The new initiative will seek to increase investment in new Wisconsin businesses by allowing individuals a limited, 100 percent capital gains exclusion of up to $10 million for long-term capital gains reinvested in qualifying Wisconsin businesses.
• Ramp up capital investment for start-up businesses. To increase flexibility for entrepreneurs seeking tax-creditable investment, Doyle proposes to raise the current cap of $1 million in tax-creditable angel investment per business to $4 million. Permitting entrepreneurs to receive tax creditable investment of up to $4 million from angel investors will allow new start-up companies to receive financing from any combination of angel or venture investors to the maximum of $4 million in total tax-creditable investment.
• Increase the total amount of angel investor and venture capital tax credits available to businesses. By 2015, the total amount of Accelerate Wisconsin tax credits would reach $100 million, leveraging a minimum of $400 million in private investment.
The Act 255 program is credited with increasing investments by angel investors in early-stage companies by more than 54 percent between 2005 and 2006. Doyle said the investment picture in 2003, when PriceWaterhouseCoopers–National Venture Capital Association data reported only $39 million in venture capital investments came to Wisconsin, dramatically improved by 2006, when the same figure increased to $73 million.
While 2007 figures still are being calculated, investments totaled $68 million through the first three quarters of 2007.