Why I support Senator Hester’s SB 597 for Angel Investing in Maryland.

I support Senator Hester's SB 597. Here is why you should too.

Maryland has a conversion problem, not a talent problem.

Frankly, Maryland is a shit place for a tech business to operate. We get taxed extra-extra, and we have very few resources for real innovation outside of biotech, govtech, and equi-tech. But it is time to change that. We should be rewarding innovation, rewarding those who take risks on innovation, and doing what we can to attract and retain top talent.

We rank fifth nationally in R&D intensity and first in median tech wages at $126,467. But we consistently fail at turning research into companies, companies into jobs, and innovation into economic impact. The state's own economic development materials acknowledge this contradiction plainly: Maryland leads in research and development but lags in converting that strength into economic impact and growth.

SB 597 fixes that gap.

What SB 597 Actually Does

This bill creates the Maryland Artificial Intelligence Partnership within the University System of Maryland. It establishes a single coordination point for AI research, workforce development, and industry collaboration. It builds Technology Extension Hubs to help small businesses access AI tools at no cost. It creates an AI Incubation Lab where students work directly with state agencies on real AI deployment.

Translation: Maryland stops wasting its intellectual firepower on fragmented efforts that go nowhere.

The Angel Capital Connection

Angel-backed startups survive longer, create more jobs, and successfully exit at higher rates than comparable firms without angel backing. This is not opinion. This is cross-country evidence from NBER research.

Why does this matter? Angel capital is the fuel that gets companies across the valley between research and real business. When a state is rich in labs, universities, and technical talent but thin in commercialization velocity, angel money is not a side issue. It is the core mechanism for translating public and institutional research into companies, payrolls, and tax base.

Maryland already gets this in slices. We offer 33% tax credits for cybersecurity investors and 50% in certain counties. We offer 33% for biotech investors with larger enhancements in specific zones. We do this because we know capital is mobile and early-stage risk needs state support. SB 597 extends that logic to AI across the entire ecosystem.

Why Maryland Needs This Now

Other states are not waiting. Massachusetts launched its AI Strategic Plan. New York created Empire AI. New Jersey established an AI Task Force. Even Mississippi launched a coordinated AI initiative. Virginia keeps stealing our talent with better business climate and lower taxes.

The Amazon HQ2 miss still stings. Maryland's Commerce Department projected winning would mean $17 billion in annual economic activity and $7.7 billion in annual wages when fully operational. We lost to Virginia. Again.

Meanwhile, business leaders spent 2025 warning about new B2B service taxes pushing firms out of state. The Washington Post reported Maryland executives arguing such taxes could force relocations. The Maryland Chamber warned that our business climate ranking dropped ten places to 32nd nationally in two years.

We have the ingredients: major universities, federal research gravity, cybersecurity depth, high-skill labor. We lack the coordination. SB 597 provides it.

The Fragmentation Problem

UpSurge Baltimore's 2025 report shows 486 startups in the Baltimore region with $664.7 million in total funding. Strong numbers. But the same report calls our moment an "inflection point" - we have relied on federal stability and now need to diversify into commercialization and private-sector growth.

TEDCO describes Maryland's cyber ecosystem as "robust, but fragmented." That fragmentation is killing us. Excellence in silos loses to organized ecosystems every time.

The Maryland Tech Council has been saying this for years. Accelerating growth requires improved access to venture capital, stronger human capital development, and better technology-transfer resources. TEDCO's economic impact study found its core programs generated $1.6 billion in Maryland economic activity in 2018 and supported 7,746 jobs. But that is still just a fraction of what coordinated effort could produce.

The Real Stakes

Maryland produces elite research, elite technical talent, and sector-specific excellence. We underperform on commercialization, coordination, and ecosystem scale-up. Angel investing helps fix that because it raises startup survival and job creation. State coordination helps fix that because fragmented excellence does not beat organized ecosystems in New York, Massachusetts, or Virginia.

AI is not one industry silo. It is a cross-cutting capability that affects workforce development, startup formation, government modernization, and competitiveness all at once. States that organize early, build talent pipelines, and make it easier for founders and operators to execute will win. States that remain fragmented will continue to underperform, even if they have world-class institutions.

Your Move

The hearing is Wednesday, March 11th at 1pm in the Education, Energy, and Environment Committee. Written testimony and oral sign-up opens Monday, March 9th from 8am to 6pm. Written testimony must be uploaded as PDF and becomes public.

Submit testimony. Show up. Tell them you support coordinated AI development over continued fragmentation.

Maryland should lead in AI because we already lead in research and talent. SB 597 gives us the structure to convert that leadership into companies, jobs, and tax base.

Do not let another decade slip by while other states eat our lunch.