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What will it take for Tennessee to become the “Innovation Capital” of the U.S.?

BY JUSTIN OWEN

December 17, 2020 10:38AM

It was big news when Elon Musk fled Silicon Valley for Texas. And he’s not the only one. Companies and innovators who head them are leaving states like California and New York in droves due to high taxes and a heavy-handed government. 

What if Tennessee stole these headlines and brought the world’s brightest minds here by becoming the innovation capital of the U.S.? That’s something Beacon is committed to making a reality. But in order to do so, we must create an economic environment where innovators, from homegrown small businesses to Musk himself, can thrive. 

The first thing we need to do is to slash government red tape. One sure way to do that is to fast-track new business innovations. Right now, bringing a new product or service to market in Tennessee requires innovators and entrepreneurs to jump through a lot of unnecessary regulatory hoops that have nothing to do with health and safety. Other states have solved this problem by passing regulatory sandbox laws that essentially fast-track new ideas that were not even contemplated when those regulations were passed often decades ago.

These laws allow new startups to apply for an innovation fast-track to operate in a “sandbox” free from those unnecessary and onerous regulations for a period of time, while still requiring them to protect consumers’ health and safety. When that time period expires after say, two years, policymakers can analyze the regulations that would have otherwise impacted them and determine whether those regulations should be reformed or outright repealed so they don’t stifle future innovation. 

To date, states have only offered these innovation fast-tracks in specific sectors like financial technology and insurance. While this is a great start, if Tennessee is going to lead the nation in innovation, state legislators should pursue the broadest sandbox law in the nation. That would allow all kinds of new businesses to start and grow here, create jobs, and solve our biggest problems.