NJEDA Approves Tool to Grow State’s Innovation Economy

The New Jersey Economic Development Authority Board of Directors on April 13 approved the creation of the New Jersey Innovation Evergreen Fund, which aims to increase access to strategic resources and venture capital in the Garden State.

Under the new NJIEF, the state hopes to connect with the private sector to partner and support entrepreneurs and innovation. Using up to $600 million, the state would become a startup capital partner alongside venture capital groups.

Not only would this support New Jersey entrepreneurs and startups, but it would likely lead to the growth and retention of more such businesses in the Garden State.

The New Jersey Innovation Evergreen Fund is a groundbreaking public-private partnership that will fuel our innovation economy by attracting entrepreneurs and venture capital to the state.
— Governor Phil Murphy

“The NJIEF builds on the strengths of New Jersey’s world-class business leaders to create a steady stream of investment and expertise that will nurture the next generation of innovators,” Murphy continued. “By encouraging investment in entrepreneurship and start-ups, we are driving job creation and economic growth in New Jersey.”

The new tool was born out of the Economic Stimulus Act of 2020, while the concept was first announced in 2018 as part of Murphy’s Economic Development Strategic Plan.

Tim Sullivan, CEO of the New Jersey Economic Development Authority – OFFICE OF GOVERNOR EDWIN J. TORRES/NJ

“When entrepreneurs think of innovation leaders, New Jersey should be at the top of their list,” said NJEDA CEO Tim Sullivan. “The NJIEF will not only serve as an innovative approach to investing in entrepreneurs, but also as a key contributor to job creation and sustainable economic growth. Today’s announcement demonstrates Governor Murphy’s leadership in growing NJ’s innovation economy by investing in New Jersey companies and startups.

Up to $300 million in transferable tax credits will be auctioned to raise initial capital for the program. Companies would have to commit to supporting the state’s innovation economy to be able to buy the tax credits. This would go through mentoring, internships, sales and availability to serve on the NJIEF advisory board for a year.

“The NJIEF is a groundbreaking program that will catalyze venture capital investments in New Jersey startups,” said Kathleen Coviello, director of economic transformation at NJEDA. “The state’s role as an equity investor will encourage established firms to commit capital and knowledge-sharing resources, creating a dynamic cycle of innovation.”

Once funding is raised, NJEDA will partner with professional venture capital firms operating across the country to co-invest the funds in eligible New Jersey high-growth companies.

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