Fri 16 Dec 2011 |
|
After six years of heated Congressional debate and NVCA lobbying efforts, Congress has passed a SBIR/STTR Reauthorization bill that allows majority vc-backed companies to participate in the SBIR program. This bill was included in the National Defense Authorization bill which passed the House and Senate this week and has been sent to The White House for the President's signature. The President is expected to sign the bill as early as today.
Senator Landrieu (D-LA), Chair, Senate Small Business Committee and Representative Graves (R-MO), Chair, House Small Business Committee and several other conferees finally hammered out the differences between the Senate and House bills which reflects a compromise a bill that passed the House earlier this year and an amendment that the Senate approved earlier this month. This compromise will finally provide much-needed certainty for small companies interested in participating in the program.
The following are the key provisions included in this final SBIR package:
- Reauthorizes the SBIR/STTR program for six years;
- Increases the SBIR allocation from 2.5 percent to 3.2 percent;
- Increases majority vc-back company participation up to 25 percent for NIH, DOD, and NSF, and 15 percent for other agencies;
- Increases both Phase I and Phase II award levels, which have not been raised since 1982. The award guidelines are increased from $100K to $150K for Phase I and from $750K to $1M for Phase II, allowing for an additional Phase II on the same project.
- Allows the agencies to use 3 percent of SBIR funds to administer SBIR programs, increase oversight;
- Introduces performance-based standards to encourage companies to focus on commercialization through phase III of the program, and;
- Gives SBA more power to track who is receiving the awards by requiring the agencies to submit the number of vc-backed vs. non vc-backed companies receiving the awards.
NVCA applauds Congress for finally reaching a compromise and allowing majority vc-backed companies back into the SBIR program. Since 2005, when SBA changed its policy to SBIR eligibility, NVCA has been asking Congress pass legislation to allow majority vc-backed companies back into the SBIR program. NVCA and several member firms testified numerous times before Congress and SBA advocating a change in policy. NVCA continued to assert that SBA's interpretation of the 51% individual ownership criteria (that excludes companies owned 51% or more by venture capital firms) has cut off a critical funding source to our country's most innovative companies and SBIR grant decisions should be based on the merits of the application and not the funding sources of the small company applying for the grant.
Effective immediately, venture-backed companies who have basic research initiatives that could qualify for an SBIR grant can pursue this path, and we encourage our members to inform their companies of this positive and long-awaited development. It has been a long time coming but patience has paid off and we look forward to the benefits that these grants will bestow on innovation in the U.S. |
|
Thu 15 Dec 2011 |
|
Written by Jennifer Connell Dowling
|
|
| |
| Congress took additional steps towards easing the IPO process for emerging growth companies this week as hearings were held in both the Senate and the House on the topic of capital markets. Former NVCA and IPO Task Force chairman Kate Mitchell testified at both hearings in support of S. 1933 and H.R. 3606, identical bills which seek to provide a regulatory on-ramp for emerging growth companies, allowing them to phase-in compliance costs while also improving their ability to communicate with investors during an IPO. The bills reflect work that was done by the IPO Task Force this summer and have the full support of the NVCA. You can read Kate's testimony here.
We remain very encouraged by the bipartisan support these bills have thus far received, which reflects the fact that the measures set out an extremely reasonable approach to helping emerging companies pursue an IPO, while maintaining investor protection. In turning their attention to these issues, Members of Congress are demonstrating the strong recognition that emerging growth companies are critical to moving the US economy forward. S. 1933 and HR 3606 are designed to encourage this critical sliver of private companies to go public.
While the bills still must wind their way through the legislative process, we are off to a very auspicious start. The fact that the bills are identical, bipartisan and revenue neutral will certainly help move the legislation more quickly through both bodies.
We don't expect these bills to solve all the ills of the IPO market - but we do expect them to make the process less daunting and more efficient for emerging growth companies that have tremendous potential yet which today have reservations about pursuing an IPO. Strong progress was made this week and we thank Kate for her dedication and time to this important legislative process. We will look to Congress when they return in January to keep the momentum going. |
Fri 09 Dec 2011 |
|
On Wednesday, NVCA signed on to a letter to lawmakers that seeks to slow down the consideration of two bills that, if enacted in their current form, would have a chilling effect on investments in Internet companies and technology innovation in the U.S.
The House legislation was introduced by Judiciary Chairman Lamar Smith (R-TX) and is known as HR 3261, the Stop Online Piracy Act (SOPA). The Senate bill, introduced by Judiciary Chairman Patrick Leahy (D-VT), is referred to as the Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act, or PIPA (S. 968). Both bills have garnered considerable attention, both positive and negative. The bills are aimed at fighting piracy and counterfeiting on foreign “rogue” websites by enabling copyright owners and the Justice Department to require search engines, paid advertising providers, social networking sites and domain name service providers to immediately terminate access or cease providing services to websites that are “dedicated to infringing activities.”
While the goals of the legislation are laudable, we have concerns, particularly about new parameters for liability that could threaten entrepreneurs and investors of legitimate domestic websites. As currently written, company websites can be targeted and essentially shut down if the Attorney General believes copyright infringement has taken place. Additionally, the owners of the site and any investors in the company could be liable for infringement damages. Given the seemingly broad nature of the legislative language, many VC-backed sites could be at risk if there is just a single link or reference to copyrighted material. The legislative language also makes it very difficult for a company to adequately defend itself in ample time so that their websites are not immediately shut down.
A bipartisan group of Senators and Representatives, including Sens. Ron Wyden (D-OR), Maria Cantwell (D-WA), and Rep. Darrell Issa (R-CA) put forward a draft framework for legislation that would address the problem of rogue sites in an alternative manner. NVCA intends to work with lawmakers to bring all sides together to reach a reasonable compromise that doesn't threaten the operations of our companies. We will keep you informed of developments here at NVCAccess. |
Thu 08 Dec 2011 |
|
Written by Jennifer Connell Dowling
|
|
| |
Legislative efforts to ease the IPO path for emerging growth companies took another step forward this morning with the introduction of H.R. 3606, the “Reopening American Capital Markets to Emerging Growth Companies Act of 2011.” With Reps. Fincher (R-TN) and Carney (D-DE) in the lead, this bipartisan legislation has 27 original cosponsors and is identical to the Senate bill, S. 1933, which was introduced last week. Both bills seek to provide a regulatory on-ramp for emerging growth companies for a definitive period of time after an IPO as well as improve the communications process between IPO companies and potential investors, all without compromising investor protection. Both bills build upon the recommendations of the IPO Task Force, a private group of professionals operating in the IPO ecosystem and led by past NVCA chairman Kate Mitchell..
Next week there will be two hearings on these bills. On December 14, the Senate Banking Committee will have a hearing on capital formation and investor protection, which will include discussion of S. 1933, and on December 15th the House Financial Services Committee will hold its own hearing. The NVCA expects to be well represented at both these hearings, although the witness lists have yet to be formalized. We will keep you informed in the coming weeks as this process proceeds. We remain extremely encouraged by the strong bipartisan support for this legislation and the speed at which these bills are moving.
|
Thu 08 Dec 2011 |
|
| Last Monday, FASB Chairman Leslie F. Seidman announced the addition of a FASB agenda item to consider reducing or eliminating certain fair value measurement disclosure requirements for private companies.
"FASB selected this project because of pervasive concerns expressed by nonpublic entity stakeholders regarding existing fair value disclosures, particularly that many of the requirements are irrelevant to their financial statement users and are very costly to prepare," stated Ms. Seidman.
NVCA members have been very active in the ongoing dialogue regarding the appropriate GAAP (generally accepted accounting principles) for private companies and the accompanying disclosures, and have raised the concerns cited by the Chairman. NVCA board members and members of our CFO Task Force, a group comprised of more than 100 member-firm CFOs, have served on FASB committees and task forces, participated in many roundtables and presented in several FASB-SPONSORED education sessions. This has increased FASB'S awareness that private and public companies have stakeholders with very different needs and different levels of reliance on the audited GAAP financial statements.
Recent increases in disclosures and documentation have significantly increased staffing needs at venture capital firms, and increased audit fees the fund must incur, resulting in distraction of the investment professionals and little additional benefit to the financial statement users.
NVCA looks forward to working with Chairman Seidman and the FASB members and staff in the coming months on this important matter. Please refer questions to me at j (at) nvca (dot) org. |
Thu 01 Dec 2011 |
|
Written by Jennifer Connell Dowling
|
|
| |
Today Senators Schumer (D-NY), Toomey (R- PA), Warner (D-VA) and Crapo (R-ID ) introduced legislation that will help smooth the path to IPO for America's emerging growth companies and improve the efficiency and effectiveness of communications between IPO companies and their potential investors. The legislation, entitled "Re-Opening American Capital Markets to Emerging Growth Companies Act of 2011" comes just weeks after the IPO Task Force, a coalition of professionals operating in the capital markets ecosystem and led by former NVCA Chairman Kate Mitchell, issued formal recommendations to re-invigorate the capital markets system. The NVCA worked with the Task Force to educate members of Congress as to the challenges faced by emerging growth companies, as well as the economic implications of leaving the situation unaddressed. As you will see in the summary of the legislation (link), many of the Task Force recommendations are included in the bill including:
- Creating an on-ramp for emerging growth companies during which time scaled regulations would be in effect, easing the compliance burden of requirements such as Sox 404b;
- Eliminating unnecessary quiet periods for company research prepared by an underwriter before a lock-up and after an IPO; and
- Improving the ability for pre-IPO companies to communicate with qualified investors through a "testing the waters" provision.
The NVCA strongly supports this legislation as it mitigates many of the issues venture-backed companies face on the path to IPO without compromising investor protection. In a statement we submitted to today's Senate Banking Hearing on "Spurring Job Growth Through Capital Formation While Protecting Investors" we commend the bipartisan group of Senators for their leadership and support of this important legislation and urge its swift passage so that implementation can begin.
Most importantly, the NVCA would like to recognize the tireless efforts of former chairpersons Kate Mitchell who led the IPO Task Force on which NVCA and others sat, and Dixon Doll who first raised the IPO market as a concern in 2008. After years of patience and quiet diplomacy, it looks as if we might have a legislative solution to these critical concerns. We will keep you informed of progress of this bill which will hopefully be brought to the Senate floor in early 2012. |
Wed 23 Nov 2011 |
|
Since the passage of Dodd-Frank, we have heard from a number of NVCA members requesting guidance regarding which specific entities are required to register/report under the new law. That is, should the filing be done for the management company, each GP entity, or both? Our members cited a general dearth of guidance on this aspect of the registration/reporting requirements and we wanted to fill the gap. While there are many considerations in determining this pathway, and each situation is different, NVCA asked the team at Proskauer to frame the issues that each member firm might consider as it moves forward.
NVCA is now pleased to provide this white paper to our members and the general public. This document represents the latest of several tools and resources for making the ERA (Exempt Reporting Adviser)/RIA (Registered Investment Adviser) path selection and then navigating it efficiently. Of course, each firm’s strategy should be developed with that member’s own counsel and we encourage you to review this document with them.
If you have any questions, please contact John Taylor at jstaylor (at) nvca (dot) org. |
|
|
|
|
<< Start < Prev 1 2 3 4 5 6 7 8 9 10 Next > End >>
|
|
Page 8 of 23 |
