More than 200 entrepreneurs and bioscience, technology and business advocates descended on Annapolis on February 16 to urge state lawmakers to enact an administration bill that would create Invest Maryland – a premium tax credit program aimed at generating $100 million in private investment funding for emerging Maryland businesses.
Under the proposals, tax credits would be issued to participating insurance companies that contribute capital to the fund for investments in early stage Maryland companies. The proposal is intended to strengthen Maryland’s resources for nurturing growth in our state’s biotech, information technology, and clean-technology industries.
The strong turnout for “Invest Maryland Day” was coordinated by the Greater Baltimore Committee, The Tech Council of Maryland, MDBio, the Department of Business and Economic Development, and regional technology councils.
“This bill a greatly-needed incentive for innovation in Maryland,” Greater Baltimore Committee President and CEO Donald C. Fry told members of the Senate Budget and Taxation Committee, which heard testimony on SB 180. “It would demonstrate that Maryland is ready and willing to participate in the new economy.”
Fry also attended the House Ways and Means Committee hearing on the House companion measure, HB 173.
Fry participated in one of two lead panels headed by Governor Martin O’Malley to testify before the General Assembly’s key budget committees. The governor’s panel included Maryland Secretary of Business and Economic Development Christian Johansson; University System of Maryland Chancellor Brit Kirwan, and Johns Hopkins University President Ronald Daniels.
Joining Fry on a panel of private-sector advocates and Maryland entrepreneurs was Renee Winsky, president of the Tech Council of Maryland; Steve Dubin, CEO of Martek Biosciences; Rob Rosenbaum, president of TEDCO and a former venture fund managing director, Stan Tucker, president of Meridian Management Group, and John Webster, CEO of Odyssey Technologies.
Panelists cited the need for early-stage funding to get emerging companies through the financing “valley of death,” the in-between stage at which entrepreneurs have exhausted most initial start-up investments from friends and angel investors, but need funds to get their new company to a more developed stage that wil attract today’s venture capital firms.
In Maryland, the effects of the recession on financing has largely evaporated such early-stage funding, advocates said. “Today, if we had to start over again, I’m not sure we could make it in Maryland,” said Dubin, whose Howard County-based biosciences company now employs 600, including 250 in Maryland.
There are three major components to a healthy entrepreneurial culture – innovation, entrepreneurs, and capital, Rosenbaum told lawmakers. Maryland is rich with innovation. Also, a generation of new entrepreneurs is emerging here, helped in part by entrepreneurial programs and universities in the state. But when it comes to capital, “This is where we’re very short,” he said.
For minority entrepreneurs, early-stage capital is “virtually non-existent,” Meridian’s Tucker told lawmakers. Under the Invest Maryland proposal, a portion of the investment funding would be made available to minority entrepreneurs through the Maryland Small Business Development Financing Authority.
“This is the kind of strategic, effective and leveraged state investment in business growth that Maryland’s business leaders and economic development experts had in mind when they identified such initiatives as one of the eight core pillars of a strong business environment contained in the GBC’s recent report ‘Gaining a Competitive Edge,'” said Fry.