Beyond Silicon Valley: Expanding Access to Capital Across America
Committee on Banking and Currency
2025-03-25
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Source: Congress.gov
Participants
Transcript
M
Mr. Bill Newell
The Committee on Financial Services will come to order. Without objection, the Chair is authorized to declare a recess of the Committee at any time. This hearing is entitled, Beyond Silicon Valley, Expanding Access to Capital Across America. Without objection, all members will have five legislative days within which to submit extraneous materials to the Chair for inclusion in the record. I now recognize myself for four minutes for an opening statement. Good morning. I want to welcome our members today to a hearing on expanding access to capital. And I really look forward to this great panel's testimony. Over my financial career prior to entering Congress in Arkansas and Texas, I've seen firsthand the incredible entrepreneurial talent that's alive and well outside traditional venture and financial hubs like New York or San Francisco. Across our country, Americans are building companies that can drive our economy forward. Yet too often, these promising startups lack access to local advice and capital that they need to grow, scale, and succeed. Right now, virtually all venture funding pours into just a few coastal cities, leaving the innovators and entrepreneurs of flyover country often overlooked and underfunded. When capital circulates in this geographically concentrated eddy, investors in the economy at large miss out on big ideas, innovations, and economic breakthroughs that can and do emerge from the labs, kitchen tables, and garages in Arkansas, Nebraska, or Ohio. Talent and ambition don't stop at state borders, and neither should investments. In Little Rock, we've seen companies like Aptogee, which started from scratch and grew into a powerhouse by providing communication tools to schools nationwide. That's the innovation born in Arkansas, benefiting students everywhere. It's proof that when investments are made outside of traditional hubs, incredible things can happen.
M
Mr. Bill Newell
At the same time, the number of public companies in the United States has declined dramatically from over 7,000 30 years ago to fewer than 4,000 today. In my view, threatened litigation, excessive cost, and regulatory burdens have made it much harder for small businesses to go public, shutting out entrepreneurs and everyday investors alike. We must ensure that local incubators and small business investors have the support they need and that those aspiring risk-taking teams, regardless of where they're based, can succeed. Our capital market should work for everyone. That means reducing barriers for startups to access funding, incentivizing investment in regional businesses and reforming outdated regulations that improve access to growth capital to ensure that a public offering is more of a viable option once again. By incentivizing investments in regional startups, supporting local incubators and streamlining rules, we can create an environment where more companies can scale, thrive and ultimately become public companies. and for the means that we're ensuring that we're not just creating opportunities for companies to grow, but also expanding investment opportunities for Americans that want to be a part of that growth. For too long, investment opportunities, particularly in private markets, have been reserved for the select few. By broadening access, we create more avenues for wealth creation, allowing everyday investors to share in the long-term prosperity that comes from innovation. Modernizing our securities laws can help break down these barriers so that every founder, regardless of background or location, has the resources to support and build the next great American success story. The policies that we're discussing today will not only expand across access to capital, they will also strengthen our economy and create lasting opportunities for millions of Americans. With that, I yield back the balance of my time, and I recognize the ranking member of our committee, Mrs. Waters, for four minutes opening statement.
Thank you very much, Mr. Hill. Before I begin, I want to comment about the outrageous national security breach reported yesterday. It is my understanding that the details of the attack were shared with someone who wasn't cleared, putting the lives of those involved and the whole mission in jeopardy. This latest breach follows unlawful access to the critical payment systems and the data of Americans. Mr. Chair, I hope you agree that enough is enough. I wish we had more positive information to report on, but the incompetence of this administration is glaring. With that, I appreciate today's hearing on capital formation. The reality is that our economic outlook is bleak and is entirely of the president's own doing. Mr. Chair, I want to take a moment to read excerpts that highlight the magnitude of the economic crisis created by Donald Trump. From Reuters, more than $4 trillion in stock market values has evaporated since Trump took office. From the Financial Times, quote, economists expect Trump's policies to slow economic growth and fuel higher inflation. From INC Magazine, Trump's tariffs are causing some startups to scrap their IPOs. From Reuters, JP Morgan, Chief global economist says the risk of a recession will rise to quote, probably 50% or above when Trump's April 2nd tariffs kick in. This is the state of our economy.
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