Riley Csernica of Mount Pleasant and her partner Chelsea Ex-Lubeskie of Goose Creek are developing a shoulder brace that helps athletes re-enter competition while limiting the chances for re-injury.
While their business plan has already earned recognition in nine national and regional competitions, Csernica and Ex-Lubeskie calculate it will take $300,000 to ready their pitch for corporate partners as they set up their Charleston office.
Their story is remarkable in that these business partners are 2013 graduates from Clemson University post-graduate programs. They represent a new class of South Carolina entrepreneurs: bright students who want to engage their skills in South Carolina but are frustrated by a listless job market.
South Carolina’s entrepreneurial market is growing rapidly, particularly here in the Lowcountry. While Charleston is only the 75th largest metro area in the country, it was ranked one of the top 10 fastest growing cities for software and Internet technology.
Unfortunately, our state has ranked near the bottom in funding access for these new opportunities.
However, because of a new law passed by the General Assembly, that should be changing very soon.
The High Growth Small Business Job Creation Act of 2013, or better known as the “Angel Investment Incentive” bill, encourages private investment in high-growth potential start-ups.
By offering South Carolina angel investors a 35 percent tax credit, our state’s budding advanced technology and life science companies now have a whole new world of access to the job-creating capital their businesses need to blossom.
Investors in early-stage companies are often called “angel investors” because they risk their own money to fund innovation businesses that, because of their entrepreneurial nature and tendency to think differently, are usually shut out from traditional funding methods.
When you hear angel investor, think Apple, Google, Facebook and countless other companies that would not have gotten beyond paper plans without angel investment capital.
Companies that make it can boom into job-creating economic engines. Innovation-based businesses tend to grow faster and pay higher wages than the economy as a whole, in fact, life science-based businesses pay a wage 84 percent higher than the state average.
Rep. Dwight Loftis (Greenville) and Sen. Hugh Leatherman (Florence) sponsored this legislation along with numerous co-sponsors.
The South Carolina Biotechnology Industry Association (SCBIO), the Charleston, Columbia, Greenville and State Chambers of Commerce, together with a broad statewide coalition of businesses and organizations, supported the bill because it levels the playing field for South Carolina companies who usually had to compete elsewhere for very limited investment dollars.
Roughly 26 states have enacted similar measures, including Georgia and North Carolina. And, as proven everywhere it has been enacted, the resulting job-creation and surge in new economic activity more than makes up for the cost of the tax credit.
Minnesota’s 2010 investment credit quickly generated $137 million in angel investment, far exceeding the state’s $34 million offered in tax credits.
In Wisconsin, since enacting a similar measure in 2005, a total of 237 start-up companies have drawn $235.2 million in angel investment and more than $900 million in additional outside funds. From $58.8 million in tax credits, these start-ups have created 1,112 jobs paying an average of $76,500 a year.
South Carolina is poised for similar results that could triple the number of private investors in our state. A potential $57 million could flow into our state’s economy if just 1 percent of the estimated 100,000 qualified angel investors in our state invested 5 percent of their eligible funds.
South Carolina has already shown that it can compete for the best manufacturing jobs in the world.
We now have the opportunity to prove South Carolinians like Riley Csernica and Chelsea Ex-Lubeskie can invent, innovate and create new products that have the power to cure disease, relieve suffering and improve our lives.
Bobby Harrell, a Republican, is speaker of the S.C. House of Representatives and represents District 114, which includes portions of Dorchester and Charleston Counties. Wayne Roper is president of the South Carolina Biotechnology Industry Organization, a trade association representing the researchers, entrepreneurs and manufacturers of innovative medicines, medical devices, medical equipment, agricultural bio and biofuels.