SOAR Act
Bill: S.2631 | Sponsor: Sen. Booker, Cory A. (D-NJ)
Policy area: Commerce

Summary:
Startup Opportunity Accelerator Act of 2021 or the SOAR Act
This bill requires the Small Business Administration to develop and implement a program to award cash grants of at least $1,000,000 to organizations that support new small businesses. These awards may be used for construction costs, space acquisition, and programmatic purposes, but they may not be used to provide capital or professional services to small businesses directly or through the subaward of funds.
The organization must have the support of new small businesses as a primary purpose and be often classified as an accelerator. The term accelerator means an organization that (1) supports new businesses with a focus on technology, research, and development; (2) frequently provides, but is not exclusively designed to provide, seed investment in exchange for a small amount of equity; (3) works with a startup for a predetermined amount of time; (4) provides mentorship and instruction to scale businesses; or (5) offers startup capital or the opportunity to raise capital from outside investors.

To amend the Small Business Act to create a program to provide funding 
  for organizations that support startup businesses in formation and 
   early growth stages by providing entrepreneurs with resources and 
     services to produce viable businesses, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Startup Opportunity Accelerator Act 
of 2021'' or the ``SOAR Act''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) startups have contributed greatly to the United States 
        economy, with research showing that between 1982 and 2011, 
        businesses 5 years or younger were responsible for nearly every 
        net new job created;
            (2) startups face common challenges as they seek to 
        transform their ideas into successful, high-growth businesses;
            (3) 4 metropolitan areas in 3 States--the San Francisco Bay 
        Area, New York City, Boston, and Los Angeles--receive nearly 75 
        percent of all venture capital investment, which is a critical 
        source of funding for high-growth startups;
            (4) of startups that receive venture capital funding, 2 
        percent are African-American-owned, 6 percent are Latino-owned, 
        and only 13 percent are owned solely by women;
            (5) incubators and accelerators are new models of growth 
        that drive innovation by connecting entrepreneurial individuals 
        and teams to create viable business ventures and social 
        initiatives;
            (6) incubators and accelerators support promising startups 
        through partnerships, mentoring, and resources connecting them 
        with seasoned entrepreneurs;
            (7) the goal of an incubator or an accelerator is to help 
        create and grow young businesses by providing them with 
        necessary financial, technical, and industry support and 
        financial and technical services; and
            (8) startups offer unique opportunities for growth and 
        development for women, minority, and veterans to become 
        successful entrepreneurs and leaders in new and developed 
        fields.

SEC. 3. GROWTH ACCELERATOR FUND COMPETITION.

    The Small Business Act (15 U.S.C. 631 et seq.) is amended--
            (1) by redesignating section 49 (15 U.S.C. 631 note) as 
        section 50; and
            (2) by inserting after section 48 the following:

``SEC. 49. GROWTH ACCELERATOR FUND COMPETITION.

    ``(a) Definitions.--In this section--
            ``(1) the term `disability' has the meaning given the term 
        in section 3 of the Americans with Disabilities Act of 1990 (42 
        U.S.C. 12102);
            ``(2) the term `eligible entity' means an organization--
                    ``(A) that is located in the United States;
                    ``(B) the primary purpose of which is to support 
                new small business concerns; and
                    ``(C) that is often classified as a growth 
                accelerator;
            ``(3) the term `growth accelerator' means an organization 
        that--
                    ``(A) supports new business concerns with a focus 
                on technology, research, and development;
                    ``(B) frequently provides, but is not exclusively 
                designed to provide, seed investment in exchange for a 
                small amount of equity;
                    ``(C) works with a new business concern for a 
                predetermined amount of time;
                    ``(D) provides mentorship and instruction to scale 
                businesses; or
                    ``(E) offers startup capital or the opportunity to 
                raise capital from outside investors;
            ``(4) the term `minority serving institution' means--
                    ``(A) an institution described in any of paragraphs 
                (1) through (7) of section 371(a) of the Higher 
                Education Act of 1965 (20 U.S.C. 1067q(a)); or
                    ``(B) a junior or community college, as that term 
                is defined in section 312(f) of the Higher Education 
                Act of 1965 (20 U.S.C. 1058(f));
            ``(5) the term `new small business concern' means a small 
        business concern that has been in operation for not more than 5 
        years; and
            ``(6) the term `State' means any State of the United 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, and any territory or possession of the United States.
    ``(b) Funding.--
            ``(1) In general.--Not later than 1 year after the date of 
        enactment of this section, the Administrator shall develop and 
        begin implementing a program to award cash grants of not less 
        than $1,000,000 to eligible entities to support new small 
        business concerns.
            ``(2) Use of funds.--A grant under this section--
                    ``(A) may be used for construction costs, space 
                acquisition, and programmatic purposes; and
                    ``(B) may not be used to provide capital to new 
                small business concerns directly or through the 
                subaward of funds.
            ``(3) Disbursal of funds.--In disbursing funds under this 
        section, the Administrator may use incremental or scheduled 
        payments.
    ``(c) Application.--
            ``(1) In general.--An eligible entity desiring a grant 
        under this section shall demonstrate that the eligible entity 
        will use the grant to provide assistance to not less than 10 
        new small business concerns per year.
            ``(2) Requirements.--In soliciting applications and 
        awarding grants to eligible entities under this section, the 
        Administrator shall employ a streamlined and inclusive approach 
        that--
                    ``(A) widely publicizes funding opportunities to a 
                broad audience, including through the use of digital 
                resources such as the website of the Administration and 
                social media;
                    ``(B) utilizes an easily accessible submission 
                process or platform;
                    ``(C) shall make every effort to minimize--
                            ``(i) the use of forms, detailed budgets, 
                        supporting documentation, or written 
                        submissions; and
                            ``(ii) any other burdensome requirement;
                    ``(D) focuses on solution-based approaches and 
                results-based outcomes;
                    ``(E) encourages innovation; and
                    ``(F) allows proposals or pitches to be presented 
                using various formats or media.
    ``(d) Criteria.--The Administrator shall establish criteria for a 
grant under this section that shall give priority to eligible entities 
that--
            ``(1) are providing or plan to provide to new small 
        business concerns--
                    ``(A) office, manufacturing, or warehouse space, 
                including appropriate operations infrastructure;
                    ``(B) access to capital either directly from the 
                eligible entity (using amounts other than the amounts 
                provided under the grant) or through guidance and 
                contacts for acquiring capital from outside investors;
                    ``(C) access to professional services either 
                directly from the eligible entity (using amounts other 
                than the amounts provided under the grant) or through 
                guidance and contacts for acquiring professional 
                services, including accounting and legal services; or
                    ``(D) a formal structured mentorship or 
                developmental program that assists new small business 
                concerns with building business skills and 
                competencies; or
            ``(2) if located within 20 miles of a minority serving 
        institution, demonstrates a referral or programmatic 
        relationship with that institution.
    ``(e) Considerations in Choosing Recipients.--In determining 
whether to award a grant under this section to an eligible entity, the 
Administrator shall take into account--
            ``(1) for eligible entities that have in operation a 
        program to support new small business concerns, the record of 
        the eligible entity in assisting new small business concerns, 
        including, for each of the 3 full years before the date on 
        which the eligible entity applies for a grant under this 
        section--
                    ``(A) the retention rate of new small business 
                concerns in the program of the eligible entity;
                    ``(B) the average period of participation by new 
                small business concerns in the program of the eligible 
                entity;
                    ``(C) the total, average, and median capital raised 
                by new small business concerns participating in the 
                program of the eligible entity; and
                    ``(D) the total, average, and median number of 
                employees of new small business concerns participating 
                in the program of the eligible entity;
            ``(2) for all eligible entities--
                    ``(A) the number of new small business concerns 
                assisted or anticipated to be assisted by the eligible 
                entity;
                    ``(B) the number of new small business concerns 
                applying or anticipated to apply for assistance from 
                the eligible entity;
                    ``(C) whether the program of the eligible entity 
                provides or would provide assistance to individuals in 
                gender, racial, or ethnic groups underrepresented by 
                existing programs to assist new small business 
                concerns; and
                    ``(D) other metrics determined appropriate by the 
                Administrator;
            ``(3) the need in the geographic area to be served by the 
        program to be carried out using the grant for additional 
        assistance for new small business concerns, if the area has 
        sufficient population density, as determined by the 
        Administrator;
            ``(4) the level of experience of the entrepreneurial 
        leadership of the eligible entity; and
            ``(5) the ability of the eligible entity to use and 
        leverage local strengths, including human resources, 
        infrastructure, and educational institutions.
    ``(f) Requirement To Award Grants to Certain Accelerators.--In 
order to promote diversity in entrepreneurship, the Administrator shall 
award not less than 50 percent of amounts appropriated for grants in a 
given fiscal year to--
            ``(1) accelerators located in an area described in 
        subparagraph (A), (B), or (C) of section 31(b); and
            ``(2) accelerators for which not less than 50 percent of 
        the small business concerns served by the accelerator are small 
        business concerns--
                    ``(A) owned and controlled by socially 
                disadvantaged individuals or economically disadvantaged 
                individuals, as defined in paragraphs (5) and (6)(A), 
                respectively, of section 8(a);
                    ``(B) owned and controlled by women; or
                    ``(C) that are not less than 51 percent owned by 
                one or more--
                            ``(i) Native Americans;
                            ``(ii) individuals participating in the 
                        Transition Assistance Program of the Department 
                        of Defense;
                            ``(iii) individuals who--
                                    ``(I) served on active duty in any 
                                branch of the Armed Forces, including 
                                the National Guard and Reserves; and
                                    ``(II) were discharged or released 
                                from such service under conditions 
                                other than dishonorable;
                            ``(iv) formerly incarcerated individuals; 
                        or
                            ``(v) individuals with a disability.
    ``(g) Matching Nonpublic Funding.--An eligible entity receiving a 
grant under this section may obtain funds from a private individual or 
entity (including a for-profit or nonprofit entity) that are--
            ``(1) for the same purposes as a grant may be made under 
        this section; and
            ``(2) used to carry out the program of the eligible entity 
        carried out using the grant under this section.
    ``(h) Consequences of Failure To Abide by Terms or Conditions of 
Grant or Requirements of This Section.--The Administrator shall notify 
each eligible entity receiving a grant under this section that failure 
to abide by the terms and conditions of the grant or the requirements 
of this section may, in the discretion of the Administrator and in 
addition to any other civil or criminal consequences, result in the 
Administrator withholding payments or ordering the eligible entity to 
return the grant funds.
    ``(i) Annual Progress Reporting by Recipients of Grant.--Each 
eligible entity receiving a grant under this section shall submit to 
the Administrator an annual report on the progress of the program 
carried out using the amounts received under the grant, including--
            ``(1) the number of new small business concerns 
        participating in the program during each of the 3 years 
        preceding the report;
            ``(2) the number of new small business concerns applying to 
        participate in the program during each of the 3 years preceding 
        the report;
            ``(3) the retention rate of new small business concerns in 
        the program;
            ``(4) the average period of participation in the program by 
        new small business concerns;
            ``(5) the total, average, and median capital raised by new 
        small business concerns participating in the program;
            ``(6) the total, average, and median number of employees of 
        new small business concerns participating in the program;
            ``(7) the number of new small business concerns--
                    ``(A) owned and controlled by socially 
                disadvantaged individuals or economically disadvantaged 
                individuals, as defined in paragraphs (5) and (6)(A), 
                respectively, of section 8(a);
                    ``(B) owned and controlled by women; or
                    ``(C) that are not less than 51 percent owned by 
                one or more--
                            ``(i) Native Americans;
                            ``(ii) individuals participating in the 
                        Transition Assistance Program of the Department 
                        of Defense;
                            ``(iii) individuals who--
                                    ``(I) served on active duty in any 
                                branch of the Armed Forces, including 
                                the National Guard and Reserves; and
                                    ``(II) were discharged or released 
                                from such service under conditions 
                                other than dishonorable;
                            ``(iv) formerly incarcerated individuals; 
                        or
                            ``(v) individuals with a disability; and
            ``(8) other metrics determined appropriate by the 
        Administrator.
    ``(j) Reports to Congress.--The Administrator shall submit to 
Congress an annual report on the program under this section, which 
shall include an assessment of the effectiveness of the program, 
including an assessment based on the metrics listed in subsection (i).
    ``(k) Coordination With Other Small Business Administration 
Programs.--The Administrator shall take appropriate action to encourage 
eligible entities receiving a grant under this section to use and 
incorporate other programs of the Administration, such as small 
business development centers, small business investment companies, 
loans under section 7(a), assistance under title V of the Small 
Business Investment Act of 1958 (15 U.S.C. 695 et seq.), and resource 
partners of the Administration, including women's business centers and 
veteran's business outreach centers.
    ``(l) Coordination With the Department of Veterans Affairs.--In 
consultation with the Secretary of Veteran Affairs, the Administrator 
shall make available outreach materials regarding the opportunities for 
veterans within the program under this section for distribution and 
display at local facilities of the Department of Veterans Affairs.
    ``(m) Listing on Website.--The Administrator shall include a list 
of eligible entities receiving a grant under this section on the 
website of the Administration.
    ``(n) Authorization of Appropriations.--There is authorized to be 
appropriated to the Administration $800,000,000, to remain available 
until expended, to carry out this section.''.
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