It is believed that the United States lags behind in support of digital and other startups. John Chambers, the former CEO of Cisco, spoke very colorfully about this at the Forbes summit not long ago.
Such remarks may frighten entrepreneurs who plan to launch an ICO in the USA, set up a fintech company in the US or any other risky business. At the same time, there are those people who strongly disagree with this idea and they refer to certain laws and facts. Let's look at them.
Laws that have affected the financing of startups
The first thing to remember is the key federal laws and amendments. For example, an amendment to the prudence rule in the Pension Act.
Prior to this amendment, large funds were virtually barred from investing in venture capital. After amending, investment in venture capital from pension funds has grown from a few hundred million a year to more than $ 4 billion over 10 years, and total annual venture capital has grown by about ten billion!
If the changes to the Act had not been introduced, startups would have occupied a very small part of global business, compared to what they represent today, and the promotion and number of companies registered under ICO, cryptocurrency or fintech would not have reached the heights we see now.
The second law is the Bay-Dole Act, which sets out the practical mechanisms by which technological advances in research funded from the federal budget in universities can be transferred to individuals for further development and monetizing.
The law has had a very strong impact on the investment in the US startups, especially in the field of biotechnology - an industry that could not exist at all without access to technologies that have been obtained in national universities.
The final word
In combination, both laws represent a common idea - to stimulate private investment. The main focus is not on stimulating the launch of startups in the US with funds from the budget but on creating conditions in which the market can develop, and private investors have the opportunity to choose the most worthy startups.
The current situation suggests that a powerful engine has been created, which to this day encourages US investment in startups and venture capital. However, in the future, the United States will still have to modify government policy on startups, responding in a timely manner to the changes created by modern fintech, cryptocurrencies and other advances in science and technology.
We would also like to draw your attention to the fact that IQ Decision UK solicitors provide a consultation on the legal aspects of investing in the US startups in the course of which we will answer all your questions on the subject of the article.
We are also ready to provide full legal assistance for your business in the United States and legal assistance for an investment project in the UK or other countries. For reference, please ring us up using the contacts listed in the form below.