Advanced industries represent a sizable economic anchor for the U.S. economy and have led the post-recession employment recovery. Modest in size, the sector packs a massive economic punch, according to a recent study released by the Brookings Institute.
Colorado realizes the importance of supporting advanced industries as part of a vibrant economy and has recently recommitted its investment through the renewal of the Advanced industries Investment Tax Credit program.
The Colorado Office of Economic Development and International Trade (OEDIT) has issued 126 tax credits to 111 different investors involved in one of seven Advanced Industries (AI) through the Advanced Industry Investment Tax Credit program (AIITC).
Colorado’s advanced industries include:
Through the tax credit program, OEDIT provided $1.875 million to investors, who then invested $9.5 million in 44 Colorado AI companies–a tax credit difference of about 5.2 times. Participating investors say that their investments would have either been a significantly lower contribution, or else it would not have occurred at all.
One such AI company thriving from AIITC is dBMedx, a medical device manufacturer that created a bladder scanner meant to prevent catheter acquired urinary tract infections (CAUTI). Thanks to AIITC, dBMedx received more than 10 investments as a result of the program for almost $750,000.
The tax credit program is part of Advanced Industries Accelerator Grant Programs. The Advanced Industries Accelerator Program (AIA) was created in 2013 to promote growth and sustainability in Colorado’s advanced industries by driving innovation, accelerating commercialization, encouraging public-private partnerships, increasing access to early stage capital and creating a strong infrastructure that increases the state’s capacity to be globally competitive. AIA encompasses three distinct grant programs: Proof of Concept, Early Stage Capital and Retention, and Commercialization Infrastructure.
By stimulating private sector capital via rewarding local investors, the program is able to target technology sectors in Colorado and help drive innovation, accelerate commercialization, increase access to early stage capital, and create a strong ecosystem that increases Colorado’s global competitiveness.
In just five years, Colorado has received over $1.6 billion in venture capital investments and $1.2 billion in financing and investments from 2011-2013 for life sciences alone, making it a top 10 state for venture capital in life sciences. With assistance from programs like AIITC and AIAGP to fund and enhance commercialization of AI projects, Colorado has become a life science center through research institutions, bioscience companies, and scientific talent.