US VC's decline in investment in small businesses is staggering

If we focus on building a business and innovating – we can "escape from the day of birth" in a slump. I've spent most of my career investing in entrepreneurial projects, with my own money and planning for others. So I know that America's problems are tricky. One of the big areas of America's competitive advantage is a stunning setback--that's the entrepreneurial world.　　The phenomenon may be turned a blind eye, but its undercurrent will be very realistic and even dangerous consequences. With unemployment still hovering around 10% per cent, and underemployment (including unemployment but not the rush to re-employment) has surpassed 17% per cent, the study found that almost all net increases in jobs from 1980 to 2005 came from small companies less than 5 years old. 2/3 of the 12 million new jobs that were created in 2007 came from small companies that founded 5 or even less than 5 years ago. Small businesses with fewer than 500 employees employ a 30% of the High-tech people in the United States, such as scientists, engineers and computer professionals.　　As the auto industry, banking and insurance industry slash jobs, the new job growth engine for small businesses seems particularly important. But the vast majority of stimulus funds, including the Troubled Asset Relief programme (TARP), have not been able to absorb even a trickle of the most current inflows. To add insult to the burden, small businesses are still under pressure.　　Their looming crises include rising tax rates (state and federal taxes), rising employee health insurance costs, persistent market demand, and, of course, the embarrassing situation of almost nowhere to get growth capital, including equities and debt. The recent decline in venture capital's investment in small businesses is an excellent testament. Since 2007, venture-capital transactions have been declining and hovering at a low level, according to data released by PwC and the American Venture Capital Association, the first of its kind since the early 90. From 2008 to 2009, the number of venture investment transactions fell by 30% to 2,306. Total investment in wind investment fell 32% to 17 billion dollars.　　Similarly, the amount and amount of investment by Angel Fund investors has fallen sharply. At the same time, the vast majority of start-ups in the early days of small businesses have nothing to mortgage assets, not in today's tight credit market to obtain bank loans.　　And no matter what assets the entrepreneur has (usually the entrepreneur's own home and 401k pension account), it is now less valuable than it used to be. It is clear that only 8% of the Obama administration, cabinet with business experience, faces daunting challenges. To make suggestions, my colleague, Ms. Kramer, and I launched a survey asking 1,000 VCs to give feedback.　　Based on their feedback, our three suggestions are given below. Tax incentives for individual investors: the federal government should allow tax deductions for the general revenue invested in qualified small businesses to be deducted to a maximum of USD 250,000; When the tax returns wereWhen the investment exceeds USD 800,000, the deduction is gradually cancelled. The move follows the 179th provision of the United States Domestic Revenue Act (Internal Revenue Code), which stipulates that the company can deduct the cost of office machinery and equipment purchased annually (rather than by the traditional depreciation method for annual costs), up to a maximum of USD 250,000.　　The incentive policy should be valid for at least 5 years. Tax incentives are given to individuals and companies that invest in start-up enterprises: As with individual investors, the venture capital industry, especially the venture capital industry, which invests in start-up companies, is under pressure because of the weakness of the recession and the IPO market (the preferred way to achieve investment returns)　　, and large investment institutions such as endowment funds and pension funds have suffered capital losses. Investors (including fund agencies and individuals) who invest in start-ups need to be encouraged. Based on this concept, individual investors who invest in start-up venture capital funds should be able to enjoy a tax base deduction of up to $250,000 a year (which is phased out when their total investment exceeds 800,000 dollars a year). The government should allow companies to invest as much as $10 million a year on start-up VC funds, and all investments should be subject to tax deductions.　　It should also be a 5-year project aimed at driving a flood of capital into VC markets that invest in start-up companies so that VCs can inject them into small businesses.　　Exemption from capital gains tax on investments targeted at start-up Enterprises: investors who invest in small businesses should be exempt from capital gains tax when they sell the enterprise for profit, so long as his venture capital is invested for more than two years. Will there be investment failures and bankruptcies? Of course it is inevitable. But there will be new ventures like Apple and Anderma apparel (Under armours), not to mention the myriad of smaller, business-booming businesses that are the source of new jobs and the recovery of the economy.　　If we focus on the areas that we are best at-that is, building businesses and innovating-we can "escape the day" in a slump. Nothing is more dangerous now than the competitive advantage of the United States, and we must be bold and resolute.