Legislation could provide help for South Carolina start-ups
Filed Under Bryant, Caucus, Top News
State Sen. Kevin Bryant, R-Anderson, said he hopes that a bill he’s supporting will give investors one more reason to put their money behind South Carolina start-ups.
Senate bill 287, the South Carolina Entrepreneurial Success Fund Act, would provide tax breaks to those who invest in funds that offer seed money to start-up businesses. The bill received a favorable report last week in the subcommittee of which Sen. Bryant is chairman and is gaining support among business leaders.
To be eligible, investors would need to create a seed fund of $10 million. The fund must be managed by a South Carolina taxpayer, and 70 percent would need to be invested in local companies that are three years old or younger.
The legislation would give those investors income tax credits worth 30 percent of the amount they contribute, with the total amount of credits not exceeding $5 million in a year.
Sen. Bryant said the bill complements the state’s endowed chairs fund, which encourages research at colleges and universities, and the South Carolina Venture Capital Program, which supports companies that want to expand in the state.
“I think it’s the jump-start our economy needs,” Sen. Bryant said.
The South Carolina Chamber of Commerce supports seed capital legislation that encourages investment in emerging companies. And John Warner, a Greenville businessman and member of the South Carolina Venture Capital Authority, wrote an editorial last month backing bill 287.
Mr. Warner said the amount of capital invested in South Carolina per person is among the lowest in the Southeast. The state’s Venture Capital Investment Act raised $50 million to invest in local companies, but the proposed legislation would encourage investment even earlier in the start-up process.
Each year at Innoventure — a conference that introduces investors and emerging companies— most of the venture capitalists in attendance are from out of state. And their desire to be close to the companies they invest in is causing the state to lose a number of start-ups, said Chris Przirembel, Clemson University’s vice president for research and economic development.
Mr. Przirembel called the Senate bill “an important next step” in the state’s efforts to build a knowledge-based economy through local start-ups. The bill has been transferred to the Labor, Commerce and Industry Committee, where it should be heard next week, Sen. Bryant said. From there, it would go to the Senate floor for a vote.
Independent Mail
By Heidi Cenac
2/20/2008
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