Brand New J Supports The Governor’s Innovation Evergreen Fund
Dear Members of the New Jersey Senate and General Assembly:
Brand New J, a group composed of the top Venture Capitalists (VCs) and successful entrepreneurs in New Jersey, strongly endorses Governor Murphy’s proposed New Jersey Innovation Evergreen Fund (Evergreen Fund). Brand New J members are from both sides of the political aisle, composed of large and small startups, early founders, exited founders, and venture capitalists from both the high-tech community and the life sciences community. Across the board, Brand New J members are in agreement that the Evergreen Fund would help New Jersey regain its position as a national leader in the innovation economy.
Ever since the 1960’s, when a few motivated engineers from Bell Labs left New Jersey to start a company in Palo Alto that sparked the creation of Silicon Valley, New Jersey has been losing its once-dominant leadership position in tech innovation. Today, New Jersey ranks ninth in the country in attracting venture capital. At this pace, within the next 5 years, New Jersey could end up outside the top 10 in the country. With 80% of venture dollars going to the top 5 states, it’s crucial that New Jersey reclaim its position and be ranked as one of the top 5 states in the country for venture capital.
The reason for this is simple, New Jersey stands to benefit from the substantial economic benefits of the tech and life sciences industry and New Jersey must create new opportunities for its world-class talent pool of tech workers and graduates. The tech industry offers some of the best paying jobs and highest job growth in the country. With schools like Princeton, Rutgers, NJIT, Stevens, and Kean, very few states can match the quality and quantity of tech talent coming into the labor pool each year. However, New Jersey loses much of this talent pool to New York City, Philadelphia, or the West Coast. When entrepreneurs think of starting a company, they often overlook New Jersey.
On a positive note, this is starting to change. One major issue for entrepreneurs has been the lack of quality start-up hubs/offices in New Jersey. With the recent ascension of Bell Works, Newark Venture Partners, Princeton Tiger Labs, Asbury Park, 1776, and co-working locations in Hoboken + Jersey City, New Jersey now has many options for entrepreneurs to choose from that fit their culture.
More so, entrepreneurs are becoming increasingly interested in offering their employees and families a high quality of life. New Jersey offers exceptional standards with its quality schools, strong communities and relative affordability when compared to New York and Philadelphia.
Entrepreneurs have made it clear that they want to stay and start companies in New Jersey. Innovative companies such as Vydia and Gridless Energy have started and stayed in NJ, even when they have been given strong incentives to move to New York or Philadelphia.
With founders motivated to stay in New Jersey with its new attractive workplaces, New Jersey is on the precipice of completing the puzzle of how to retain and attract high growth businesses. The last two pieces of the puzzle are gaining state support for the tech and life sciences community and venture funding for New Jersey based start-ups.
Many tech leaders in New Jersey have complained for years about how the state has ignored the high-growth innovation economy in favor of large companies. The election of Governor Murphy has changed that for the tech community. Governor Murphy has refocused the New Jersey Economic Development Authority and other state agencies towards smaller, innovative companies. This recalibration has been welcomed by tech leaders in the state who recognize the economic benefits innovative companies bring to their states and communities. We finally have a Governor who understands the importance of innovation towards the long-term success of New Jersey and we strongly endorse Governor Murphy’s efforts to bring innovation back to New Jersey.
An important element of the Governor’s initiatives is the New Jersey Innovation Evergreen Fund. The Evergreen fund would match venture capital dollars invested in New Jersey based companies. Unlike most economic incentives, the Evergreen fund is not a tax credit to VCs. The Evergreen Fund would only invest in a New Jersey based company if a VC invested in that company and put it’s own money at risk. For New Jersey based VCs, if the Evergreen Fund matched their investment to a certain level, they would now have additional capital to deploy to additional NJ companies.
For VCs based outside of the state, this fund enables them to invest in NJ companies at levels that they previously might not have. For example, a VC in Silicon Valley can put $250,000 in a startup in New Jersey, and if the Evergreen Fund matched that $250,000, it makes it much easier for the out of state VC to invest in New Jersey and maybe even motivate some of their companies to move to New Jersey.
New Jersey has many great things going for it in the tech sector: The Governor’s dedication to the innovation sector, the many co-working spaces launching in NJ, and entrepreneurs wanting to start companies in the state. We now need to move the needle on venture investing.
We at Brand New J strongly support Governor Murphy’s proposed Evergreen Fund. The Evergreen Fund can go a long way to ignite the wave of investment and innovation the state needs to be one of the top places for starting a business in the United States.
Brand New J — Dedicated To Bringing Innovation Back to New Jersey.
Jay Bhatti, Co-Founder, BrandProject
Brian Smiga, Co-Founding Partner, Alpha Venture Partners
Gary Matola, Madison Marquette
Colin Day, CEO, iCIMS
Debbie Hart, CEO, Bio NJ
Sean O’Sullivan, founder, SOSV
Brian Twibell, CEO, WireSecure Inc.
Jennifer Crews, Chief Ecosystem Officer, Shift Thinking
Chris Sugden, Managing Partner, Edison Partners
Thomas Wisniewski, Managing Partner, Newark Venture Partners
Aaron Price, President & CEO, NJ Tech Council; Founder, Propelify
Chris Sullens, CEO, CentralReach
Roy Lamanna, CEO, Vydia Inc.
Patrick Murphy, Co-Founder, Gridless Energy
Ralph Zucker, President, Somerset Development — Bell Works
Bob Herrmann, President & CEO, Discovery Data
Jim Goldman, CEO CradleRock Consulting, Former CEO Godiva Chocolatier
John Frankel, Partner, ff Venture Capital
David J. Sorin, Partner, McCarter & English, LLP
Jim Gunton, Managing Partner, Tech Council Ventures
Stephen Socolof, Managing Partner, Tech Council Ventures
Raj Valli, CEO, Thinkster Math
Mario M. Casabona, Founder & MD, TechLaunch and Casabona Ventures
GiGi Goldman, Co-Founder, We Share Solar
Bert Navarrete, Founder, TigerLabs
Vijar Kohli, Co-Founder, TiE NJ Angel Networks
James Barrood, Former CEO, New Jersey Tech Council
Jesse P. Nash, Member and Partner, Reitler Kailas & Rosenblatt LLC
Chris Pallé, Owner/Director Of User Experience, Wisdom & Craft, Inc
Dennis Bone, Executive in Residence and Advisory Board, Feliciano School of Business