The last few weeks of 2016 have been an active time in policymaking that had a positive impact on the venture capital industry. NVCA kept its on eye on the ball on behalf of the venture industry and as a result came away with several key victories.
After a multi-year, bipartisan effort, the 21st Century Cures Act was signed into law last week. NVCA applauded this achievement as a major win for funding medical innovation and developing cures for rare diseases. NVCA engaged in the ‘Cures’ initiative from start, as board members Mike Carusi and Alexis Borisy testified before Congress in 2014 to demonstrate the value of venture capital investment in medical innovation. Within the bill’s 996 pages is increased funding for the National Institutes for Health and efforts to advance precision medicine that will help VCs who work tirelessly to develop innovative and life-saving cures and treatments. At NVCA, we spent a week in the Fall educating policymakers about the role of venture in medical innovation, including through the awesome video below.
In late December, Congress also passed a 5-year extension of the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. NVCA has long been a supporter of the SBIR and STTR programs. Over the course of 2016, we advocated for reauthorization of the programs via letters, meetings with key congressional staff, and Senate testimony by Scott Kupor of Andreessen Horowitz and Dr. Ali Behbahani of NEA. SBIR and STTR have contributed to major technological breakthroughs developed by venture-backed companies, including advancements in identity theft, regenerative wound healing therapies, and biometric sensor technology. A five-year reauthorization cemented into law will provide much-needed certainty and funding necessary for future innovation.
Another accomplishment for our industry was enactment of the SEC Small Business Advocate Act, which establishes an Office of the Small Business Advocate at the Securities and Exchange Commission (SEC). This new office will give a much-needed voice for small businesses and their investors within the SEC. This effort is another small step towards reopening the public markets to small capitalization companies.
Last week, President Obama also signed into law the NVCA-backed Consumer Review Fairness Act, which bans “gag clauses” against consumers who publish their truthful experiences on review sites like Yelp or TripAdvisor. Since 2006, venture firms have invested $3 billion in 147 companies with services primarily focused on ratings or reviews. To ensure consumers continue to benefit from these sites, unscrupulous businesses will no longer be allowed to stifle consumer’s speech.
Finally, both houses of Congress passed the NVCA-supported American Innovation and Competitiveness Act, which bolsters basic research opportunities, encourages scientific entrepreneurship, and reduces administrative burden. In our letter of support for the bill, we wrote that “[f]ederal commitments to basic research can start a virtuous process where new technologies become startups backed by significant private risk investment from venture capitalists to grow into successful companies, fueling economic growth and creating millions of American jobs.” We are particularly pleased to see the legislation authorize the successful I-Corps program and reaffirms the importance of commercialization of research.
In sum, these accomplishments are a welcome capstone to a successful 2016 for NVCA’s policy advocacy. With a new administration and Congress beginning in January, our message will be critical to ensure this momentum is continued. We hit the ground running with a letter to President-elect Donald Trump that demonstrates how startups are needed throughout the U.S. and specific policy proposals that will facilitate growth of entrepreneurship. But we cannot do this alone and encourage you to engage with NVCA to ensure venture’s voice is at the table in the new year as tax, immigration, life science, and many other policy issues are considered in DC. The health of the national economy depends on it.