The attractive opportunity for investment in Indiana stems from a favorable private equity environment and the market leading nature of many industries.  These factors contribute to an exciting opportunity to generate risk adjusted returns and contribute to the growth of the State.

Over the last ten years, approximately $260 billion [1] of capital was invested in Indiana based companies. The growth of private equity investments in Indiana has benefited local industries including:  Life Sciences, Business Services, Energy, Technology, Industrial, Automotive and Agriculture.  New businesses and private capital have moved to Indiana due to its highly educated workforce, supportive business environment and clusters of innovation. As Indiana continues to develop its clusters of innovation, private equity investment will continue to act as a vital source of growth for the local economy. 

Indiana state government continues to take an important, proactive and efficient role in creating an attractive investment environment for private investors. CSG believes that the passage of several important pieces of legislation has served to encourage expansion and growth in the state.

As a result of these current and proposed pieces of legislation and widespread cooperation among like-minded investors, Indiana’s private equity community has developed an excellent foundation for future growth and expansion, which CSG believes will encourage Indiana based companies to expand and attract non-resident companies to consider establishing an Indiana presence.

A series of Indiana focused investment funds have been launched starting in 2003 as a means to generate returns for investors while also fostering growth in the state of Indiana. The Indiana based funds, which complete venture, growth and co-investment financings, align the interests of INPRS and Indiana pensioners with the local economy and continue to help accelerate job creation and innovation in a variety of sectors.

The Venture Capital Investment Tax Credit improves capital access to fast growing Indiana companies by providing individual and corporate investors an additional incentive to invest in early stage firms. Investors who provide qualified debt or equity capital to Indiana companies receive a credit against their Indiana income tax liability.

The Research and Development (R&D) Tax Credit provides an incentive for business investment in Indiana by providing a credit against state tax liability for qualified company research expenses. The R&D tax credit (also known as the Research Expense tax credit) is based on the increase in Indiana R&D over the prior three-year base.

The Skills Enhancement Fund (SEF) provides financial assistance to businesses committed to training their Indiana workforce by offering grants that reimburse a portion of a company’s eligible training costs over a two-year term. Each SEF application is evaluated on its merits. Companies may reapply for additional SEF funds after their initial grant is successfully completed [2].

The IBRI is a proposed industry-driven research institute that would bring business leaders and university executives together to accelerate commercialized innovation in Indiana universities and life science companies. The IBRI will exist as a private institution aimed at substantially growing the entrepreneurial capability and commercial viability of researchers and inventors in Indiana. It also will serve as a magnet for the most commercially-minded researchers outside Indiana who are looking for a place that enables them to make the most of their discoveries. The IBRI will begin with a targeted focus on life sciences because of the tremendous opportunity for jobs and economic growth in bioscience and because of the commitment by Indiana’s life sciences leaders to the effort [3].

 

There is currently a proposal for the creation of an Executive Innovation Network that will be charged with bringing more entrepreneurship, capital, and business expertise to university-based innovation. The Network’s sole focus will be to bring more investment and faster commercialization to new inventions and discoveries in Indiana universities. The Network will consist of business executives, entrepreneurs, investors, and university executives who will regularly invite university researchers to pitch current research they are conducting that has commercial potential [2}

 

Notes

[1] PitchBook

[2] Indiana Economic Development Corporation

[3] www.indianabiosciences.org