Rounds Reintroduces Legislation to Increase Access to Capital for Startups
WASHINGTON – U.S. Senator Mike Rounds (R-S.D.), a member of the Senate Banking, Housing, and Urban Affairs Committee, reintroduced the Developing and Empowering our Aspiring Leaders (DEAL) Act this week. This legislation would work to increase capital for small businesses by encouraging more investment by venture capital firms. The DEAL Act is supported by both the U.S. Chamber of Commerce and the National Venture Capital Association (NVCA).
“South Dakota entrepreneurs and startups need access to capital to grow,” said Rounds. “Small businesses are the foundation of our communities. They create local jobs and support their neighbors. The DEAL Act would encourage more investment by venture capital firms into new businesses, further fueling growth in our communities.”
“As Americans work to recover from the pandemic, the economy needs every resource available to grow businesses and create jobs,” said Tom Quaadman, Executive Vice President of the U.S. Chamber’s Center for Capital Markets Competitiveness. “Emerging Growth Companies are an important part of that equation as they represent the future of opportunity in our capital markets, which is why the U.S. Chamber applauds Senator Rounds for introducing the DEAL Act. This important piece of legislation will allow more investment in bright new ideas and future public companies that will power the next generation of American economic success.”
“This bill will support the next generation of high growth American companies and expand entrepreneurial activity into more regions of the country,” said Bobby Franklin, NVCA President and CEO. “U.S. startups are this country’s jobs and innovation engine, and improving their chances of success will generate economic opportunity and support America’s technological leadership in the world.”
The DEAL Act would remove current regulatory burdens by directing the Securities and Exchange Commission (SEC) to exempt certain investments by venture capital funds from SEC registration requirements. Specifically, the bill allows investments acquired through secondary transactions to be considered as qualifying investments for venture capital funds. This fix was originally suggested by SEC’s nonpartisan Small Business Capital Formation Advisory Committee.
Senator Rounds first introduced the DEAL Act on October 11, 2018 in the 115th Congress. Representative Trey Hollingsworth (R-Ind.) is the House sponsor of this legislation which was reintroduced on June 29, 2021.
You can read the full bill HERE.
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