How successful exits help fuel the startup ecosystem
From her lived experience, Gloria Folaron identified a significant gap in support for neurodivergent individuals in the workplace, particularly in project management. She co-founded Leantime, where she is developing accessible work management solutions that promote motivation, connection, and engagement for all employees. We sat down with her to discuss open-source models, navigating the grant system, and more.
2025 will be a pivotal year for startups and tax policy, and one instrumental program that has been crucial to the success of the company I co-founded, Event Vesta Inc, is at risk of sunsetting.
Data is a fundamental resource that powers all AI systems. There are different types of data that are utilized for different functions in AI development, and varying sources of that data.
Bad actors are constantly looking to trick unsuspecting startups into unnecessarily giving up their already-limited resources. One scam gaining in popularity is to impersonate government officials and ask startups for payment to “renew” their existing trademarks, and it demonstrates how intellectual property systems can be weaponized against startups.
The Big Story: Hearings cast spotlight on capital access obstacles. Lawmakers heard from entrepreneurs and investors this week as they examined key issues impacting startups’ ability to access capital. The House Financial Services subcommittee held two hearings covering multiple legislative proposals, including efforts to expand the pool of accredited investors and changes to the structure of certain investment funds. Those changes, if enacted, would bring much needed diversity to the startup ecosystem’s investor pool and boost funding opportunities for underrepresented entrepreneurs.
You might not realize it, but whether you’re a startup founder, a digital entrepreneur, or a casual technology and Internet user—what the U.S. Patent and Trademark Office (USPTO) does impacts you and the agency needs to be listening to you. That’s why Engine filed comments this week on USPTO’s draft strategic plan, suggesting ways the agency could improve its plans to support all U.S. innovators, creators, and entrepreneurs.
The Big Story: Startup policy priorities for 2023, and how to get involved. This week, Engine released its first-ever Startup Policy Playbook, to help give members of the startup ecosystem—startup founders and employees, investors, and support organizations—an overview of the policy conversations happening this Congress and how they can get involved in amplifying the startup voice this year.
The Big Story: Independent contractor proposed rule risks startup growth. More than two dozen startups and ecosystem support organizations are warning policymakers about a proposed change that would impact access to flexible talent. In comments this week to the Department of Labor (DOL), Engine and 28 members of the startup ecosystem spotlighted the important role independent contractors play in the startup ecosystem and the likely negative impact on innovation if startups’ ability to hire contract labor is restricted.
The Big Story: Digital Services Taxes passed on to end users, including startups. Efforts to implement a global tax deal that would help avoid sector-specific taxes on digital services ran into additional roadblocks this week. The development follows new government reports confirming that the digital services taxes (DSTs)—which are often imposed upon large technology companies—are actually paid by their end users. As a result, startups, who often build their companies with services from other large tech firms, can face increased costs to building and growing their businesses.
The Big Story: Online sales tax back in the spotlight with watchdog report. A government agency is recommending that Congress address the patchwork of state laws that govern online sales taxes, an issue that has burdened e-commerce businesses, including many startups. In a new report this week, the Government Accountability Office examined the “substantial uncertainty” and complexity of the current remote sales tax landscape and recommended that Congress work with states to streamline requirements and minimize the burdens currently imposed on businesses across the country.
The Big Story: Affirmative Action cases will impact innovation ecosystem. This week, the U.S. Supreme Court heard two cases that could upend race-conscious admissions policies used by many universities and alter the pipeline for STEM talent in the innovation ecosystem. Eliminating the ability to consider race in college admissions would have an outsized impact on on-campus diversity, the racial and ethnic diversity of many employers hiring college-educated talent throughout the country, and the makeup of the startup ecosystem and the breadth of innovation it produces.
The Big Story: Engine releases report on the role of acquisitions in the startup ecosystem. Engine, in partnership with Startup Genome, released a new report this week examining the role exits play in the startup ecosystem, highlighting the importance of exits via acquisition, and emphasizing the experience of founders that have had their companies acquired. The report—“Exits, Investment, and the Startup Experience: the role of acquisitions in the startup ecosystem”—should equip policymakers with a solid foundation from which they can advance pro-innovative policies that startups need to thrive.
The Big Story: Judge strikes down Maryland tax on digital advertising. A Maryland judge struck down the U.S.’ first tax on digital advertising, which faced vocal challenges including from technology companies and would have resulted in taxed companies passing down its cost to customers, including startups. In a ruling on Monday, the court found the tax, implemented by Maryland lawmakers to raise revenue, unconstitutional and a violation of the Internet Tax Freedom Act.
The Big Story: Proposed independent contractor rule could make hiring harder for startups. This week the Department of Labor (DoL) issued a proposed rule that is likely to impact how early-stage startups build their teams. The DoL’s proposed rule on worker classification would limit who can be considered an independent contractor and comes shortly after the Federal Trade Commission (FTC) announced similar enforcement priorities for the gig economy. As we shared in a recent blog post, the rule could limit startup flexibility in their hiring decisions, which could particularly impact growing companies with lean budgets.
The USPTO does not get all of its advice from the PPAC — and it shouldn't. But especially for an agency with limited avenues for public engagement, it's essential that when conversations are happening — including at the PPAC — policymakers make sure everyone gets a voice in how the patent system works.
The Big Story: Network access fee debates heat up worldwide. This week, European telecom companies redoubled their push to make large Internet companies pay based on the traffic they generate, a policy that would undermine net neutrality principles and negatively impact the broader Internet ecosystem. The push comes after months of agitating by Internet service providers (ISPs) for the payments, called network access fees, and amid a growing number of jurisdictions that have taken steps toward such policies, including South Korea.
The Big Story: SBIR reauthorization on the horizon, heads to the House. After months of negotiations, a key grant program for startups is expected to be reauthorized just in time for its scheduled expiration at the end of the month. The House is expected to vote next week to reauthorize the Small Business Innovation Research (SBIR) program, following a vote in the Senate to reauthorize the program for three years this past Tuesday. The program serves as a critical funding source for many startups engaged in research and development (R&D).
Last month, Senator Tillis (R-N.C.) introduced a bill to change the rules that govern what can be patented. Briefly, current patent eligibility law prevents companies from trying to own basic ideas and from trying to preclude others from building new businesses or innovations that rely on those underlying ideas.
The Big Story: Startups are collateral as policymakers talk past each other on tech policy. Over the last week we’ve seen several tech policy conversations where contradictory, party-line talking points are on full display that—if taken seriously as policy ideas on everything from privacy, to national security, to content moderation, and more—would make life much harder for thousands of startups across the country. Lawmakers’ competing and mutually exclusive visions for the Internet doesn’t stop them from threatening policy changes that would alter the way tech companies, including startups, have to operate, however, as we highlight in a new blog post.
The Big Story: SBIR reauthorization remains at a standstill. Startups await the fate of the Small Business Innovation Research (SBIR) program as lawmakers continue to deliberate its reauthorization ahead of its fast-approaching September 30 expiration. With fierce support from advocates and innovators—who recognize the positive impact the program has on the innovation ecosystem—alike, this critical funding stream for R&D and commercialization risks drying up without congressional action.
The Big Story: Biden administration unveils student loan relief plan. After months of deliberation, President Joe Biden announced a three-part plan aimed at easing student loan debt, a move that could lower barriers for entrepreneurship in the U.S. The announcement—fulfilling a 2020 campaign promise—will cancel up to $10,000 in federal student debt for many borrowers and up to $20,000 for Pell Grant recipients for those that earn less than $125,000 per year or $250,000 for households. It also includes steps to cap monthly payments, improve the forgiveness programs for borrowers who work in public service, and increase accountability around skyrocketing college costs.
Startup Advocacy Week and Congressional Startup Day underscore the importance of pro-innovation policy. Startups are key drivers of innovation, they spur job growth, and invigorate the U.S. economy. We at Engine are lucky to work with a vast network of startups across the country who know, first-hand, how essential pro-innovation policies are to their success—and those policies can only become a reality when policymakers invite startup founders to the table to listen to their experiences and hear about their needs. Those very conversations took place during this Startup Advocacy Week and Congressional Startup Day.
The Big Story: Patent policy conversations need startup voices. Policymakers are continuing to evaluate several aspects of the patent system—one of many areas where policymakers need to account for startup voices and experiences to craft policy that promotes their success. This summer, IP subcommittees in both the Senate and the House held hearings about the Patent Trial and Appeal Board (PTAB)—a venue within the Patent and Trademark Office (PTO) that can take a second look at likely-invalid patents and weed out those that should not have issued.
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