Published June 13, 2012
The Bill Wylie Entrepreneurship Act, a bill that aimed to boost angel investor activity for startup companies in South Carolina, will be re-introduced in next year’s session, the bill’s supporters said.
“We went a long way to raising the understanding that this is a critical jobs bill,” said Wayne Roper, president of SCBIO, a statewide trade association representing life science businesses. “When you start an innovation business, you have no substitute for angel investors. Their funding helps you develop your business plan and attract more capital.
“We will come back next year and be very focused on getting it through early in the session. South Carolina has great innovators and we need to grow these businesses and these jobs right here. We are not competitive right now with other regions,” he added.
South Carolina ranks near the bottom in capital opportunities for new businesses, Roper said. Report after report finds that high growth, innovation-based businesses create roughly 60% of new net jobs, he said.
The bill, which had been passed by the House, emerged from the Senate Finance Committee with amendments to the House bill. But the Senate failed to take up the measure before it adjourned.
The bill would have provided a 35% tax credit to qualified angel investors who invest in registered startup businesses. Total credits would have been limited to $5 million a year. Angel investors invest their own money and choose their own investments.
An angel investor is defined as someone with a net worth of at least $1 million. Such investors often form networks and funds and are among the first group to invest in promising, but early stage, high-risk technologies and businesses. Angel investment allows entrepreneurs to develop their concepts that later attract other private funds.
Twenty-three states have similar credit, including North Carolina and Georgia, leaving South Carolina at a competitive disadvantage, supporters of the bill have said.