The New Jersey Economic Development Authority board approved the creation of the New Jersey Innovation Evergreen Fund on April 13, which aims to increase access to strategic resources and venture capital in the Garden State.
As part of the new NJIEF, the state hopes to connect with the private sector to partner and support entrepreneurs and innovation. Utilizing up to $600 million, the state would become an equity partner in startups alongside venture capital groups.
Not only would that support New Jersey entrepreneurs and startups, but it would likely lead to more such companies growing and staying 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.
— Gov. Phil Murphy
“The NJIEF draws on the strengths of New Jersey’s world-class corporate leaders to create a steady stream of investment and expertise that will nurture the next generation of innovators,” Murphy continued. “By fostering investments in entrepreneurship and start-up companies, we are driving job creation and economic growth for New Jersey.”
The new tool was born out of the Economic Recovery Act of 2020, while the concept was first announced back in 2018 as part of Murphy’s economic development strategic plan.
“When entrepreneurs think of leaders in innovation, New Jersey should be at the top of their list,” said NJEDA Chief Executive Officer Tim Sullivan. “The NJIEF will not only serve as a novel approach to investing in entrepreneurs, but also a key contributor for job creation and sustainable economic growth. Today’s announcement serves as a testament to Gov. Murphy’s leadership in growing N.J.’s innovation economy by investing in New Jersey companies and startups.”
Up to $300 million in transferrable tax credits will be auctioned to raise the initial seed capital for the program. Corporations would have to commit to supporting the state’s innovation economy to be eligible to purchase the tax credits. That would come through mentorship, internships, sales and availability to serve on the NJIEF advisory board for one year.
“The NJIEF is a game-changing program that will catalyze venture capital investments into New Jersey startups,” said Kathleen Coviello, NJEDA’s chief economic transformation officer. “The state’s role as an equity investor will encourage established corporations to commit capital and knowledge-sharing resources, creating a dynamic cycle of innovation.”
Once the funding is raised, the NJEDA will partner with professional venture capital firms operating anywhere in the country to co-invest the funds in eligible high growth businesses in New Jersey.