WASHINGTON, D.C. – A pilot program authored by U.S. Senators Cory Booker (D-NJ) and Kirsten Gillibrand (D-NY) that aims to help small manufacturing businesses access capital and expand their operations was included in the National Defense Authorization Act (NDAA), which passed the Senate last night.
The language in NDAA directs the Defense Department to increase capital for manufacturing entrepreneurs and small businesses looking to scale-up and commercialize their innovations. The program is based off of a bill, the Scale-Up Manufacturing Investment Company Act, authored by Booker and Gillibrand and introduced in 2015 with U.S. Senators Patty Murray (D-WA), Chris Coons (D-DE), and Gary Peters (D-MI).
“Small businesses form the foundation of the American economy and help fuel innovation across industries,” Senator Booker said. “This pilot program will help small manufacturing businesses in our defense sector access capital at a critical stage in their development so they can expand their operations and, in turn, create more good-paying jobs. It will also help prevent these firms from moving their operations overseas. If we want to keep our economy growing, we must help small businesses grow and prosper and this program does just that.”
“If we want our economy to grow and create more jobs, we need to give small businesses the tools to turn their innovative ideas into successful business opportunities and expand their manufacturing operations here at home instead of being forced to outsource that work to stay competitive,” Senator Gillibrand said. “This pilot program will provide critical resources and opportunities for local entrepreneurs to expand their businesses, and ensure that new technologies are made here in America, creating more good-paying jobs and growing our economy.”
It can often take a long time – 10 years or more – for advanced manufacturing firms to get to a viable commercial scale. In the process, these firms burn through tens of hundreds of millions of dollars before they even collect their first dollar of revenue. Lack of access to capital pushes emerging manufacturing entrepreneurs to move their advanced manufacturing technologies abroad to other nations that provide better financing opportunities.
The language in Booker and Gillibrand’s bill that was included in the NDAA seeks to fill this gap by helping these firms access the capital they need to successfully scale-up their operations without going under.