PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Helping Startups Continue to Grow Act, H.R. 6130

By at 21 June, 2018, 2:19 pm

The Honorable Keith Rothfus

United States House of Representatives

Washington, D.C.  20515

 

Dear Representative Rothfus:

I am writing to express the Small Business & Entrepreneurship Council’s (SBE Council’s) strong support for the “Helping Startups Continue to Grow Act” (H.R. 6130), an important bill that would provide for a five year extension of certain Security Exchange Act exemptions and reduced disclosure requirements for companies designated as emerging growth companies (EGCs) and will continue to remain as such but for the five-year restriction on EGCs.

Under Title I of the JOBS Act, the IPO “on-ramp” for EGCs provides exemptions and provisions that make sense given the size and development of these small firms.  The scaling of rules and exemptions from certain disclosure requirements for EGCs have reduced compliance and regulatory burdens, which have benefited these promising small firms.

The five-year window is a rather limited one given the customary growth trajectory of most firms, and the fact that firms grow at different rates depending upon their industry, economic conditions, rapidly changing market forces, and other factors.  Many EGCs, in effect, are still emerging at or after the five-year limit established by the JOBS Act.  SBE Council believes it is very reasonable to extend the five-year “on-ramp” to ten years, which would not only help these firms focus on responsible growth but also incentivize more IPO activity in the United States.

Given the reduced level of entrepreneurship over the past decade or more, and the need for more high-growth firms that yield quality job opportunities and innovations for our economy, our policies must reflect a commitment to enabling and building these firms.  The “Helping Startups Continue to Grow Act” will do just that. Thank you for your leadership on this important issue, and please let me know how SBE Council can support the advancement of H.R. 6130.

Sincerely,

Karen Kerrigan, President & CEO   

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