Startup policy outlook under second Trump term
Executive coaching should be accessible to anyone who is interested, but oftentimes scaling the education is not practical. With her company Zella Life, co-founder Remy Meraz is democratizing professional development using AI. We sat down with her to discuss AI, independent contractors, and more.
After working in the financial sector for over 20 years, Mical Jeanlys-White founded her own company, WealthMore, a wealth tech with a focus on tackling a key financial barrier—wealth building and management. Her company leverages technology to connect everyday Americans with accessible wealth management services, aiming to provide wealth creation for all. We sat down with her to discuss her journey in raising capital, navigating tax policy, the evolving role of AI, and more.
Vance Reavie is no stranger to entrepreneurship. Using his knowledge from previous ventures, he created an AI platform that intelligently automates manual marketing and merchandising workflows and content generation processes for brands and retailers. We sat down with Vance to discuss the startup ecosystem in Arkansas, AI policy and regulation, grant opportunities, and more.
Founded in 2017, 60Hertz set out to tackle critical challenges in maintaining microgrids and renewable energy systems, particularly in remote regions like Alaska. Now active in eight countries, the company provides advanced maintenance technology through its SaaS platform. In this blog post, we dive into 60Hertz’s journey, from early capital-raising hurdles to success with government grants, and explore the future goals of this innovative company.
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: U.S. moves forward on AI policy, resources for startups. This week, two federal entities released materials to bolster research and responsible development of Artificial Intelligence, which are or will be made available to startups. The National AI Research Resource Task Force released its final report to the president and Congress recommending the creation of a National AI Research Resource (NAIRR), and that startups be primary users of that resource. And the National Institute of Standards and Technology (NIST) released the Artificial Intelligence Risk Management Framework, a voluntary guide for companies—including startups—as they develop AI technologies. Both developments were spurred by the National AI Initiative Act of 2020 which passed as part of the National Defense Authorization Act that year.
The Big Story: Supreme Court hears about the value of Section 230 for startups, Internet creators. The Supreme Court received dozens of briefs this week in support of Section 230, including one Engine signed explaining how the law supports startups and small Internet platforms and another that Engine helped organize about the ways Internet creators benefit from Section 230. The briefs come as the court considers Gonzalez v. Google and the applicability of Section 230—the 1996 law that enables Internet platforms to host user content without fear of ruinous litigation.
The Big Story: President Biden’s new tech priorities, and their impact on startups. President Joe Biden outlined a series of proposed changes to tech policy, including several likely to impact startups. In an op-ed this week, the president highlighted common ground with Republicans about perceived issues wrought by large tech companies, but each of the issues—data privacy, intermediary liability, and competition—also directly impact startups. As the president and Congress chart a path forward, it’s important they recognize how legislative decisions impact smaller businesses and startups when considering tech policy.
The Big Story: Congress off to rocky start while 2023 startup policy to-do list grows. The 118th Congress is off to a rough start this week as the House remains unable to move forward until they elect a Speaker, which doesn’t bode well for the long and growing list of startup priorities that Congress should act on this year. Those priorities, including key startup issues, like access to talent, broadband availability, and data privacy, must move through a Congress that appears as fraught as ever.
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: Time is running out for Congress to save imperiled immigration program. As the end of the year quickly approaches—and with it, the end of this session of Congress—the future of the Deferred Action for Childhood Arrivals Program (DACA) remains uncertain. DACA recipients play a key role in the startup ecosystem as entrepreneurs and STEM talent. Without Congressional action, the future of the program will likely end up in the hands of the Supreme Court, which could invalidate the program. Senate Democrats are pushing to provide permanent status for Dreamers before that happens.
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: 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 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).
The Big Story: EU advances overhaul of content moderation rules. Early Saturday morning, the European Union reached an agreement on a final version of landmark legislation to govern online intermediaries hosting user content in the EU. The legislation, known as the Digital Services Act (DSA), will build on existing EU law and create new obligations for companies—including startups—that will require additional staff, development of new tools, and attention toward compliance in order to serve users in the EU.
The Big Story: Startups should be prominent voice in merger guidelines re-write. This week, Engine submitted comments in response to a request for information (RFI) from the Federal Trade Commission (FTC) and the Department of Justice (DOJ) Antitrust Division on merger enforcement. The agencies issued the RFI in January as they move toward re-writing the merger guidelines, guidance that outlines how the agencies will analyze prospective mergers, which is traditionally relied on by the agencies, companies, and courts alike. Sound merger enforcement that mitigates illegal anticompetitive behavior is important for startup success, but policymakers must balance those potential harms with the benefits of acquisitions. If the new guidelines are too restrictive, they risk burdening legal transactions—including those of startups, thereby limiting startups’ exit opportunities and stemming the flow of capital in the startup ecosystem.
The Big Story: Over 100 startups, investors, organizations defend QSBS tax treatment. This week, more than 100 startups, startup investors, and startup support organizations sent a letter to Congress urging them to preserve the current tax treatment of Qualified Small Business Stock (QSBS), which helps startups attract early-stage investment and employees.
The Big Story: EARN IT Act moves forward despite concerns from lawmakers, advocates, and industry. A bill moving through the Senate would amend critical Internet legal frameworks that startups rely on to host user-generated content and disincentivize startups from using privacy and security-enhancing measures like encryption.
The Big Story: The startup policy priorities for 2022. This week, Engine released its 2022 Startup Agenda, highlighting the policy priorities of the U.S. startup ecosystem and featuring startups across the country explaining the ways policy can support them. As we explain in the agenda, there are startups in every state and every congressional district. There are startups that have all kinds of business models and rely on all types of funding. There are startups that operate in every sector of U.S. industry. And all of them will be impacted by policymakers' decisions across a range of issues.
The Big Story: America COMPETES is a mixed bag for startups. The new sweeping House package aimed at boosting American competitiveness and innovation has several provisions that would dramatically improve the startup ecosystem, but the bill also includes an unrelated bill that would harm e-commerce startups.
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