Gov. John Carney (D-Delaware) signed the Angel Investor Job Creation and Innovation Act into law today.
The act aims to bolster startups in Delaware by incentivizing investors with a refundable tax credit of up to 25 percent of their investment in qualified businesses.
The act targets investment in Delaware-based high-tech and R & D businesses with less than 25 employees, more than half of whom must work in the state.
The credit is expected to cost the state up to five million dollars starting in Fiscal Year 2020.
The Delaware Chamber of Commerce supported the measure, and its senior vice president James DeChene says it's part of their call for a more innovative approach to entrepreneurship.
“That’s the next generation of business in Delaware; small, entrepreneurial businesses that start here,” he said.
And Gov. Carney adds the way the state encourages such economic development needs to change to match a more information-based economy.
“It’s a more difficult role I think for the state than ever before,” he said. “Because we need a lot of different tools, as opposed to focusing with large grants or financial incentives … for one big company.”
Carney points to the Innovation Space at the DuPont Experimental Station, the University of Delaware’s STAR Campus and UD’s Horn Entrepreneurship program as parts of a growing startup-friendly ecosystem in Delaware.
The Angel Investing Act also follows an equity crowdfunding law signed by former Gov. Jack Markell in 2016. That allowed smaller investors to buy equity in local startups.
The Angel Investor Act, which won bipartisan support in the General Assembly, was among the legislative priorities Gov. Carney sought from lawmakers in his State of the State address.
