Before setting up shop in Minnesota, Peter Bianco experienced what he calls an âÄúentrepreneurial renaissanceâÄù in Wisconsin, where the landscape is ripe with high-tech startup companies taking advantage of a supportive tax measure in the state. Now heâÄôs working to create the same terrain here. WisconsinâÄôs Angel Investment Tax Credit provides incentive for wealthy investors to back high-risk, early-stage companies. For the past eight years, legislators, businesspeople and investors have been trying to bring the same program to Minnesota, arguing that innovative ideas sprouting from state landmarks such as the University of Minnesota are becoming successful businesses elsewhere. Despite its most recent failure in the past legislative session, a group of lawmakers and business leaders are working to develop a bill for the next session that would implement a tax credit similar to that of 29 other states. âÄúWe have these great ideas, and then when it comes time to move them forward we donâÄôt have the resources to do that,âÄù Sen. Kathy Saltzman, DFL-Woodbury, said. âÄúThere will be investors from the East and West Coast or anywhere around the world that will swoop into Minnesota and pluck these most promising ideas out.âÄù Several businesses have moved across the border into Wisconsin, including Rapid Diagnostek and VitalMedix, which sprouted from University ideas, said Bianco, now director of life science business development at Minneapolis-based Halleland Health Consulting. Even his former Wisconsin employer, Nerites Corporation, a spin-off of technology produced at Northwestern University in Illinois, started as a business idea in Minnesota, he said. âÄúThat company never wouldâÄôve gotten off the ground without the Angel Investor Tax Credit,âÄù he said. âÄúIt really helped them raise the money they needed when they needed it, and theyâÄôve gone on to be a very successful Wisconsin company.âÄù Businesses that would benefit most are in the bioscience, green energy and life sciences sector, because they have the highest potential for job growth. High-paying technological jobs tend to have a âÄúripple effect,âÄù as they require a support group of attorneys, accountants and others who form an ecosystem that fortifies the economy, Jeremy Lenz, vice president of operations at the BioBusiness Alliance of Minnesota, said. âÄúItâÄôs very clearly such a low-hanging fruit of something we need to pass if we want to grow our early-stage companies and restart our pipeline,âÄù he said. Angel investors are wealthy individuals who have the means to enter into a risky business venture. An Angel Investment Tax Credit would make it more appealing for them to invest in a new company. âÄúIf you have $300,000, you could remodel your kitchen, your house, you could buy a condo in Florida or you could look at investing in an emerging company,âÄù Saltzman said. âÄúShould we have policies in place that provide an incentive for that kind of investment? Many would argue that we should take a very serious look at that.âÄù Doug Johnson heads the UniversityâÄôs Venture Center, which works to turn faculty innovations into businesses. Angel investors who work with the University put $25,000 to $100,000 at risk by buying stock in a new company, he said. Having testified before the state Legislature in support of the tax credit bill for about the past five years, Johnson said it would even the playing field between Minnesota and other states, allow good ideas to benefit the public and bring more money back to the University. The University is the âÄúcrown jewelâÄù of the stateâÄôs economy, Saltzman said. But good ideas require additional dollars for more research, clinical trials and prototypes to get through the âÄúvalley of death,âÄù the critical time when investments are needed to push the innovation onto the marketplace. âÄúThe University is working hard to do its job to generate these very promising ideas,âÄù she said. âÄúBut when they go to pass the baton to the private sector, we have to have the policies to make that happen.âÄù Despite support from Gov. Tim Pawlenty, legislators on both sides, businesspeople and a variety of other groups, the latest $10 million-a-year, 25 percent tax credit for investors measure failed because it was included in a tax package that Pawlenty vetoed due to his opposition to tax increases in other parts of the bill. To remedy this, Saltzman said she will introduce the upcoming bill as a stand-alone or incorporate it into a larger jobs package. In the end, itâÄôs not just about competing with neighboring states; itâÄôs about creating a strong regional economy in the upper Midwest, Saltzman said. Given the economic situation, thereâÄôs no more time to sit on the issue, Bianco said. âÄúBefore long, weâÄôre going to be the only state in the upper Midwest without one of these tax credits,âÄù he said. âÄúIf we want to see a higher degree of momentum relative to early-stage companies leaving the state, then we can do nothing. We no longer have that luxury.âÄù