Today, NVCA Board Member and JumpStart Inc CEO Ray Leach testified before the House of Representatives Subcommittee on Capital Markets and Government Sponsored Enterprises at a Hearing on “Reducing Barriers to Capital Formation, Part II” Following the passage of the JOBS Act, the Subcommittee continues to identify additional legal, regulatory, and market impediments that are impacting capital formation, particularly for small and medium capitalized companies. The venture capital community was invited to give a perspective on the existing state of the capital markets for our companies.You can review Ray’s written testimony here.
As you will read, we offered a current state of play of the venture-backed IPO market and progress since the JOBS Act was passed in April of 2012. However, we recognize there is still analysis to be done and work to do particularly for small cap companies to achieve visibility and liquidity after they go public. Ray encouraged the committee to involve all market participants in exploring challenges and solutions in this area and committed to be part of the process.
At the hearing, Ray reiterated the broad economic impact that flows – both in terms of job creation and in terms of fostering further entrepreneurial activity – from the existence of a strong and liquid capital market. He also encouraged the Committee to continue its discussion around pilot programs that the SEC could undertake to test further market reforms. In turn, NVCA plans to remain engaged on this issue going forward.