Now that the recall elections are behind us, Wisconsin must continue to improve its business climate and create jobs.

 

One good move would be to attract more venture capital—the large sums that typically come from managed investment groups to fund fledgling businesses. We’re talking about multimillion-dollar investments in young companies looking to expand and create jobs.

Gov. Scott Walker and the Republican Legislature quickly got things rolling last winter when they enacted a series of bills to spur business growth. Before you start claiming partisanship and "corporate giveaways," keep in mind that Democratic Sen. Tim Cullen of Janesville, a veteran lawmaker in his second go-around in the Legislature, saw the wisdom of and voted for many or most of these bills.

 

Another proposal would have created two funds of venture capital packing $400 million. It was waylaid, however, over legitimate concerns about a $250 million Jobs Now Fund. That fund would have given tax breaks to insurance companies while letting out-of-state companies control the cash. These investors would not have had to pay back the fund’s principal and could keep 80 percent of profits.

 

How would that serve taxpayers? Many experts and Republican Sen. Glenn Grothman of West Bend wisely expressed reservations.

 

Research in our state’s university system offers great potential to create jobs in hightech and biotech industries. Would-be entrepreneurs need money to grow spin-off companies.

 

In today’s tight credit market, venture capital is needed for all types of industries, not just those involved in biotechnology and alternative fuels.

 

James Otterstein, Rock County’s economic development manager, sees pent-up demand for nontraditional financing "that spans across a wide industry spectrum—especially those that are designing and implementing ‘innovative, technology-enhanced’ applications."

Dan Cunningham of Forward Janesville notes that many of our area’s biggest business success stories, including Data Dimensions and Grainer, started with just one or two people and have grown to become major local employers.

 

"Anything we can do to encourage this type of entrepreneurial activity is something that our lawmakers ought to be thinking about," Cunningham said.

 

"Without question, Wisconsin has phenomenal growth potential," Brian Birk, managing partner of Sun Mountain Capital in Sante Fe, N.M., told the Milwaukee Journal Sentinel in a story Aug. 11. "One ingredient that’s missing is an indigenous source of early-stage capital."

 

Wisconsin has 1.8 percent of our nation’s population, the report stated, but attracts less than 0.5 percent of venture capital nationwide. The Badger State does, however, use its available venture capital to create jobs more effectively than many states.

 

Investors and economic development groups want state legislators to take another stab at creating a venture capital fund.

 

After recall elections assured that Republicans would maintain control of the Legislature but with a narrower Senate majority, Walker said such a fund is a priority for creating jobs. He noted that the voting signaled that residents want both parties to work together.

 

The need is obvious, but any venture capital plan must protect taxpayers. We look forward to a bipartisan proposal that does so.