Wisconsin’s Qualified New Business Venture program

Lesson from the Early Stage Symposium: The Office Hours

Wisconsin Economic Development Corporation (WEDC) staff members Joey Frayne and Chris Schiffner hosted an Office Hours session at the Wisconsin Technology Council’s Early Stage Symposium to educate attendees about Wisconsin’s Qualified New Business Venture (QNBV) program on Nov. 8.

The statutory program offers investors tax credits on investments made in certified QNBV businesses. Designed to encourage investors by both incentivizing and de-risking investments in startup companies, investors are eligible to receive a tax credit equal to 25% of the amount of the equity investment.

According to Technology Investment Manager, Joey Frayne, Wisconsin currently has 280 QNBV-certified businesses, and that number grows by an estimated 40-50 businesses each year.

The Venture Debt Fund is another program offered by WEDC to encourage the development of scalable, high-growth businesses. Loan amounts are determined though a matching funds system. For every four dollars a startup company raises in a funding round, WEDC will lend the company one dollar in matching capital. The fund offers loans with variable repayment terms that consider current interest rates, equity being offered and payment schedule.

The program has a $5 million budget and makes an estimated “10-20 deals a year,” Frayne said.

Criteria to become a certified QNBV include:

• Headquartered in Wisconsin
• At least 51% of employees and payroll based in the state
• Have fewer than 100 employees
• In operation for 10 consecutive years or less
• Offer significant potential for increasing jobs or increasing capital investment in Wisconsin
• Have not received aggregate private equity or venture capital investment of more than $10 million

Businesses interested in pursuing certified should contact Joey Frayne to begin the application process.