Contact: Channa Luma, 202-261-2881

Robert Grady of the Carlyle Group Testifies Before House Committee on Education and Work Force on Key Drivers of U.S. Job Creation

Cites Availability of Venture Capital, Stronger Educational System, and Continuing R&D Investment as Critical to “Economic Outperformance” in a Knowledge Economy

March 11, 2004 – Washington, DC - Robert E. Grady, Managing Director of the Carlyle Group, National Venture Capital Association (NVCA) Board Member and Stanford Lecturer in Public Management testified today before the House Education and Workforce Committee that sustainable job growth in the United States today is dependent upon an economy that fosters entrepreneurship and innovation. Mr. Grady’s testimony immediately followed Federal Reserve Chairman Greenspan’s testimony on the changing nature of the economy.

In his testimony, Mr. Grady pointed out that venture capital investment has been a major source of job creation in the United States for the past thirty years. He cited a 2001 DRI WEFA Study, which found that originally venture-backed firms directly employed over 12.5 million people. While many believe venture capital investment to be limited to Silicon Valley and high technology, Mr. Grady asserted that opportunities for innovation are everywhere. In addition to Genentech, Intel, Cisco and e-Bay, U.S. companies that were originally venture-backed include Airgas, Amazon, Costco, Starbucks, Home Depot and Federal Express.

In addition to a strong venture capital system, Mr. Grady testified that the keys to America’s ability to compete in today’s knowledge economy include:

• Maintaining transparent, liquid, trusted capital markets by enacting meaningful reforms that do not threaten innovation;
  
• Strengthening our educational system by attracting the most talented people to the classrooms to teach and allowing the use of both technology and better infrastructure
  
• Constantly seeking to maintain the world’s best system of higher education by increasing the proportion of science, math, and engineering graduates
  
• Investing in basic R&D at our universities through the research agencies of the Federal government – the National Institutes of Health, the National Science Foundation, the Department of Energy, and the Department of Defense;
  
• Maintaining flexible labor markets to continue to attract employers here; and
  
• Expanding world trade, as more open markets will yield more growth, more jobs, better and more affordable products and services, and higher standards of living for Americans.

In his testimony, Mr. Grady said, “As a country that has been built on the pioneering of new markets and industries, the U.S. will always be faced with the challenge and the question of whether to continue to pioneer, or to turn inward in some attempt to consolidate our gains. In the end, we believe that it is the combination of innovation and entrepreneurship that will continue to improve the lives of Americans, maximize the creation of new jobs to help offset the job erosion that has always been part of our economic landscape, and provide Americans with an exciting set of new opportunities for growth.”

For a copy of Mr. Grady’s testimony, please contact Channa Luma at 202-261-2881.

The National Venture Capital Association (NVCA) represents approximately 450 venture capital and private equity organizations. NVCA's mission is to foster the understanding of the importance of venture capital to the vitality of the U.S. and global economies, to stimulate the flow of equity capital to emerging growth companies by representing the public policy interests of the venture capital and private equity communities at all levels of government, to maintain high professional standards, facilitate networking opportunities and to provide research data and professional development for its members.