House Financial Services hearing advances wide-ranging ideas to send VC capital beyond coastal hubs

The House Committee on Financial Services heard bipartisan testimony on expanding access to investment capital beyond coastal venture hubs at a hearing titled “Beyond Silicon Valley: Expanding Access to Capital Across America.” Committee leaders and a panel of venture investors, biotech executives and state regulators described a suite of policy options under consideration — from extending the JOBS Act easing for newly public companies to rethinking who qualifies as an accredited investor — and debated tradeoffs between making capital more widely available and preserving investor protections.

Why it matters: Witnesses said concentrated venture funding in California, Massachusetts and New York leaves promising startups in the Midwest, South and non‑metropolitan states short of growth capital that can spur job creation. Committee members framed the hearing as a chance to update securities‑law and programmatic levers so that regional funds, fund‑of‑funds and public plans can direct more capital to local entrepreneurs without eliminating anti‑fraud safeguards.

Most significant proposals and the debate

- Extend and scale the JOBS Act “IPO on‑ramp.” Multiple witnesses urged Congress to lengthen or expand the emerging growth company (EGC) relief created by the Jumpstart Our Business Startups (JOBS) Act of 2012 so newly public firms face lower compliance costs during their early years on public markets. Joel Trotter, a lawyer who helped write IPO provisions in prior legislation, told the committee the JOBS Act “is a bipartisan success story” and argued guardrails such as Sarbanes‑Oxley 404(b) remain in place for larger firms even if ramp relief is extended.

- Reform the accredited investor test. Bill Newell, senior business…