Startups call for better access to capital for entrepreneurs of color
Before policymakers regulate AI, they need to understand a fundamental technology: neural networks.
The video game industry is concentrated in a handful of locations, leaving incredible talent in underserved areas frequently overlooked. Ben Kvalo started Midwest Games to change that narrative, supporting underrepresented game developers because increasing diversity in game development leads to better products and bigger markets. Ben recently joined us to talk about Midwest Games, the challenges of raising capital in the Midwest, the importance of small developers in maintaining a healthy video game ecosystem, and the potential benefits of AI for the industry.
Engine statement on SCOTUS Decision in Moody v. NetChoice and NetChoice v. Paxton
Consumer weather models are too coarse for farms and conservancies that are large enough to occupy their own microclimates. Dr. Carlos Gaitan started Benchmark Labs to solve this problem, leveraging artificial intelligence to create custom weather models for farmers and conservators—helping them increase their crop yield and better manage their land. Carlos recently sat down with us to discuss Benchmark Labs, his experience as an immigrant founder, the value of government funding for startups, and how policymakers should approach AI policy.
All over the country, new and young businesses—as opposed to small businesses generally—play an outsized role in net job creation in the United States. But not all new businesses are the same—the majority of entrepreneurs to-be don't intend to grow their businesses or innovate. Differentiating growth-oriented “startups” from the rest of young businesses is an important distinction that we make in this latest paper.
Today, we’re excited to partner with the Electronic Frontier Foundation and a coalition of organizations and law schools to launch Trolling Effects, a resource to empower entrepreneurs targeted by patent trolls. Patent troll lawsuits represented 62 percent of all patent litigation in 2012, and the costs associated with these suits amount to billion of dollars, stalling business growth, delaying products, and robbing startups of precious resources.
Is entrepreneurship everywhere, or is economic dynamism dead? With competing information afloat, that’s the question we sought to answer with newly-released Business Dynamics Statistics (BDS) data from the Census Bureau. We found a couple of things. First, as the U.S. economy belatedly recovered in 2011, so did business creation--the first time in five years. Second, this growth in new business formation was geographically dispersed throughout the United States.
Pedro Sorrentino hails from Sao Paolo, Brazil, and is currently living in San Francisco working for SendGrid. While attending graduate school in Boulder, Colorado, Pedro started and sold his first business. Once he graduated, however, Pedro had a hard decision to make. Based on his visa class, and the fact that he came from Brazil, the rules stated that it was mandatory for him to return home upon graduation. Would he go back to Brazil to work for his company? Or could he find an employer who would sponsor his H-1B application to stay in the United States?
The best trade agreements strengthen relationships with nations and regions vital to United States foreign and economic policy. When it comes to the secretive discussions around the Trans-Atlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP), however, any benefits might also come with now-unseen costs to startups and the tech industry as a whole if negotiators do not consider unintended consequences.
Debate around the patent system, and how we can fix it, is beginning to take shape in Washington, after many years of discussion in entrepreneurial communities around the country. Texas Republican Senator John Cornyn recently joined the debate with well received draft legislation that would help on a number of fronts; Senator Cornyn released his plan after actively seeking the input of the entrepreneurial community in Texas.
By a vote of 68-32, the United States Senate completed a landmark bipartisan effort by passing S. 744 on comprehensive immigration reform. We applaud the efforts of the Senators who voted in favor of the bill, and all their staff, as well as recognising the historic impact of the technology community. Today we stand closer to the promise of an immigration system that works for all Americans than we have for decades. Now we must ensure this promise is realized.
This week, we signed and sent a letter to the U.S. Senate alongside other leading tech groups. The movement led by TechNet gathered over 100 signatories, including the Consumer Electronics Association, Cisco Systems, Facebook, and Partnership for a New American Economy. The technology community understands the importance of the high-tech industry to the American economy, and agrees unanimously that comprehensive immigration reform is the solution we need.
This morning, I was honored to convene a Google+ Hangout with leaders, and Keep Us Here coalition partners, from across the country to talk about immigration reform. As we reach a pivotal point in the political process, we spoke about the state of play on reform in Washington and, more importantly, about about the tools that allow ordinary Americans to be a part of that debate.
Engine Advocacy's Immigration Hangout from Engine Advocacy on Vimeo.
I was joined by Ali Noorani, Executive Director of the National Immigration Forum, Jeremy Robbins, Director of Partnership for a New American Economy, Mahrinah von Schlegel, Founder and Managing Director of Cibola, a tech incubator in South Side, Chicago, with PandoDaily’s Hamish McKenzie moderating. You can watch it for yourself here to find out more on what we’re all doing and how you can get involved.
Overall, our remarks centered on the uniqueness of the moment we’re seeing right now in Washington, with a coalition being built across the aisle and from every corner of America, speaking on the need for reform to our broken system. This morning, the coalition was able to push 82 Senators to begin debate on this critical issue, While that in itself was an historic achievement, we still have a lot of work left to do.
As you know, Engine launched Keep Us Here to provide a focal point for lots of that activism, but we can’t do it without our coalition partners, and especially, all of you. Everyone on today’s Hangout independently made the point that unless Senate offices -- and soon, hopefully, House offices as well -- hear from all of us about why this issue matters in our daily lives, we run the risk of losing this moment and the promise of building an immigration system that works.
Only you have the power to make that a reality. So take action, join us at Keep Us Here, join with coalition partners like BBB, March for Innovation, Cibola and so many more, and let your voice be heard. Pledge to call next week on our day of action, and send a tweet or a letter.
Stand up and be counted. We’re closer than we’ve been in the last half century to meaningful reform. Don’t let this moment pass us by.
Ensuring compliance with myriad layers of government regulations in one country, let only globally, can be a daunting task. Take Square's recent run in with the State of Illinois, for example. Though market demand may be similar around the nation, and around the world, the regulations that guide markets vary from one region to another, much to the woe of startups.
That’s why Engine attended the first-ever international Startup Advocacy Summit in East London, organized by UK-based organization COADEC. The aim was to bring together policy groups representing tech startups, share our experiences, and devise a clear path forward to affect change on the way politicians create laws that impact startups. Alongside startup advocates from France, Italy, Spain, Slovakia, Greece, Poland, Germany, Hungary, Denmark, and the UK, Engine
delved into the issues that impact startups worldwide.
After hearing from different speakers on the first day, it was clear that despite location, all startups want to innovate freely. With that in mind, we worked to create an ideal startup ecosystem focusing on the issues that impact startups the most: immigration, patents, and data security.
After hours of healthy debate, we reached an agreement relatively painlessly -- confirming our shared ground, and affirming our policy views as reasonable.
Here’s how we answered three key questions:
1. How do we solve the visa problem?
Visa policies should be clear and flexible, allowing startups to find the talent they need, when they need it. We think the Senate Gang of Eight proposal will help startups in the U.S., so we're fighting for the change it promises.
2. What would the ideal Intellectual Property system look like?
Patent systems should promote and incentivize innovation by having clear and easy to understand frameworks. It's clear that we need comprehensive reform here in America, and startups need to be at the table when lawmakers discuss what that looks like.
3. How do we secure the open Internet?
Data regulation should be simple, giving industry room to innovate.
Of course, things get a lot messier off the island, but there’s hope that these reasonable voices will be heard more loudly when smaller organizations band together. We’re not exactly sure what the collaboration will look like in the future, but we’re looking forward to working closely with many of the folks we met, and others we haven’t, to advocate for better conditions for startups globally.
We welcome your thoughts on how this can best be achieved.
Last week, Engine joined software innovators, startups, and investors as a signatory on an amicus brief in Oracle v. Google -- a case centered on how far copyright should be extended with regards to Application Programming Interfaces (APIs). We are in favor of limiting copyright on APIs in order to protect innovation and investment.
In 2012, district courts ruled in favor of Google, concluding that Java APIs used by Android are not subject to copyright. The Federal Circuit is now reviewing the case on appeal.
We are proud to put our name on the brief because we recognize the need for software startups to innovate and the drive economy forward. Startup innovation requires interoperability (ie. open exchange of information) between systems and programs, and this is fostered by APIs.
Our interest is in “preserving the deliberate balance Congress and the courts have established for software copyright.” This balance is integral to maintaining a competitive marketplace and investment landscape. Should copyright restrictions on API’s be tightened, the real-world implications could be significant -- could decrease competition in software innovation and chill investment.
We’d like to recognize Engine member startups who also signed this brief, including: Bright Funds, Hattery, Hipiti, and Vessel. We are also thankful that prominent investors and technology industry veterans lent their voices, including Engine Advisory Board Member Brad Feld, and his partner at Foundry Group, Jason Mendelson. You can find a full list of signatories here.
We encourage you to check out the abstract and full brief.
Related articles:
Today the White House Task Force on High-Tech Patent Issues issued a statement with a clear message: it’s time to tackle patent reform. While Washington as a whole has been slow to embrace new proposals after the passage of The America Invents Act in 2011, a steady drumbeat from advocates, startups, and tech companies alike has pushed policy makers to do more to end the economic drag caused by frivolous patent litigation. The Obama administration announced seven legislative recommendations and five executive actions that are a material step toward fixing the broken patent regime.
The executive actions make clarity a top priority. The requirements include ordering the patent office to work on rules that will make the real owner of a patent more apparent, requiring the office to tighten patent examiners’ scrutiny around what a given patent claims to do, and compelling the office to provide clear, plain-English answers for consumers and businesses about demand letters from patent trolls.
The administration's legislative recommendations also meet key startup needs. The White House is calling on Congress to empower and protect individuals and businesses facing legal demands from patent trolls. This includes proposals to further increase patent owner transparency, shift incentives to discourage predatory litigation, expand the patent reviews from the America Invents Act, end-user protections from patent troll suits, and increase incentives to encourage public disclosure of demand letters from trolls.
We are excited that the White House is taking action in the patent debate. While Washington has been divided along partisan lines of late, members of both parties are unifying to right some of the apparent wrongs in the system. Today’s announcement should encourage further dialogue about what the right fixes are, and how Congress can most effectively protect startups and ultimately all businesses from unwarranted lawsuits.
You can read White House fact sheet here. We will continue to post updates on patent reform proposals from Washington.
Related articles:
Picture courtesy of Alan Kotok.
Engine supports comprehensive immigration reform, and specifically the bipartisan “Gang of Eight” bill that passed out of the Senate Judiciary Committee with amendments that further encourage innovation and boost economic growth.
To the aim of bringing this bill to a vote, and getting it passed into law, we’ve launched Keep Us Here
-- a campaign centered around online tools to call, write to, and tweet at, Congress.
This is a unique moment in American politics, and you can be a part of it.
For this to work, we need to mobilize startups, entrepreneurs, investors, innovators, and everyone who wants an immigration system that works for America in a global economy. We also hope to build a broader coalition, including a wider range of interest groups also pushing for comprehensive immigration reform.
Why does it matter?
1. Startups are responsible for all net job growth over the last twenty years
2. Engine Advocacy research tells us that for every new high-tech job, 4.3 other jobs are created in a local economy
3. With forty percent of Fortune 500 companies founded by immigrants, or the children of immigrants, it’s critically important that we safeguard the ability of the next generation of founders to start business here.
4. Under the current system we are losing knowledge, and losing out to other countries who are welcoming American-taught talent with open arms
Startups promise the rebirth -- and rejuvenation -- of the American economy. Startups can power the next generation of growth in the American economy if we let them.
Engine is working towards an immigration system that works for the United States in a global economy, and we need your help.
You can tell policymakers that you care about knowledge, talent, jobs, growth, and keeping the U.S. competitive in the global economy. Let’s raise our voices to encourage the Senate to pass comprehensive immigration reform now.
Go to Keep Us Here
. Write a letter to your Senator, tweet at Congress, and pledge to call your Senator directly on June 18th, to show your support for comprehensive immigration reform.
Use the image above as your Facebook cover picture, and the badge below for your website. If you want any further messaging, or other images, don't hesitate to reach out to us at comms@engine.is.
Engine has filed a comment with the Federal Communications Commission (FCC) encouraging broader allocation of unlicensed spectrum in the 5 GHz band. If that sounds confusing, don’t worry; spectrum management is a highly technical area of public policy. We’re speaking up because innovators need spaces to develop their ideas for new technologies and devices.
Let’s take a step back. Spectrum is allocated to commercial users through one of three main methods. It’s auctioned, as is the case with most cellular voice and data airwaves. It’s assigned, a method that has fallen out of favor since the rise of the FCC auction system but had been widely used for television broadcasters. It is also opened up, allowing users to operate on the same wireless frequencies by setting standards to prevent interference. You’re probably familiar with some unlicensed standards; they include technologies like WiFi, Bluetooth, and RFID.
Why does unlicensed spectrum matter to startups? While spectrum is a public resource, it’s tightly regulated to keep different users from broadcasting on top of each other. As a result it’s also very hard to access. In addition to regulation, the FCC has raised billions of dollars from spectrum auctions over the last twenty years, and Congress in turn has prioritized bringing in money for the federal government, putting new auctions at the front of the policy agenda. While steps have been taken to free more spectrum for unlicensed use, very few new technologies have been deployed on opened frequencies.
It’s critical that government sees unlicensed spectrum as an investment in the future. Wireless policy is as much about opportunity as it is about utilization. Just as policy decisions laid the foundation for the deployment of LTE technologies, more needs to be done for innovators looking to roll out compelling point-to-point technology, internet-of-things technologies like smart grid, and even faster, more robust WiFi standards.
Spectrum management is not a zero-sum game. Allowing innovators access to more spectrum with fewer regulatory limitations won’t necessarily crowd out existing users. We will continue to work with regulators and legislators to find opportunities for innovators to make the most of this critical public resource.
Photo courtesy of Colin Howley.
Peruvian born, Fulbright scholar, engineer, entrepreneur, and Hattery Co-Founder and Managing Director, Luis Arbulu, takes us through his perspective on current immigration policy and the Senate “Gang of Eight” bill. The highlight? The visa specifically for entrepreneurs.
In his spare time, Luis works with the White House Office of Science and Technology Policy and USCIS as an Entrepreneur in Residence, advocating for growing companies and entrepreneurs right at the center of it all.
If you have a story to tell, email editorial@engine.is
The amended Senate “Gang of Eight” immigration bill yesterday passed 13-5 out of the Senate Judiciary Committee -- but not before concessions were made by Chairman Patrick Leahy (D-VT), and Senators Orrin Hatch (R-UT) and Charles Schumer (D-NY) reached an agreement on certain provisions for high-skilled labor.
Now the bill moves forward, with significant bipartisan support from the Committee, to the full Senate for their consideration, and then hopefully to a vote. Majority Leader Harry Reid (D-NV) said this bill will be first up for debate when Senators return from their Memorial Day break, and Senate Minority Leader Mitch McConnell (R-KY) vowed that Republicans would not block the immigration bill from the floor.
In a statement on Tuesday night, President Obama thanked “the leadership of Chairman Leahy and a bipartisan group of eight Senators,” and said that “the legislation...is largely consistent with the principles of commonsense reform I have proposed and meets the challenge of fixing our broken immigration system.”
Since the proposal was first released last month, over 300 amendments -- offered by Republicans and Democrats -- were submitted to the Senate Judiciary Committee for consideration. The Committee debated over 100 and has done a great job of making the bill better where necessary, but also rejecting efforts to severely restrict legal immigration, which would impede the ability to meet workforce needs. Moreover, this mark-up process is essential in giving everyone a stake in the final product as it moves through the approval process.
Focusing on the high-skilled sections of the bill, a host of amendments have been approved, and two were approved unanimously: an amendment by Senator Sheldon Whitehouse (D-RI) to help participants in startup accelerators obtain INVEST visas, and Senator Leahy’s amendment to permanently authorize the EB-5 visa program. The program lets a private entity or state apply to become an approved regional center, and then propose development projects for immigrant investors.
Looking at the H-1B system, the efforts of Senator Hatch were particularly noteworthy; his amendment, agreed upon late in the deliberations, increases the minimum number of high-tech H1-B visas allowed annually -- but it does so without accounting for domestic economic conditions. On the issue of fraud within the system, the broad bill requires employers filing visa petitions to first offer a job to an “equally qualified” U.S. worker, but in another amendment from Senator Hatch yet to be debated, this requirement would only be imposed on “H-1B-dependent” companies.
On student visas and funding for education, the committee adopted an amendment from Senator Grassley (R-IA) to improve the student and exchange visitor visa programs, and a further amendment from Senator Hatch to put the labor certification fee towards “improving science, technology, engineering, and mathematics education and training in the United States.”
Late in the day, still trying to get the bill to the floor, Senators Leahy and Schumer were forced to agree with dissenting members of the committee to hold off on adding an amendment that would have allowed certain provisions for same-sex couples. As a result of this, and other compromises, Committee members and other Senators know the bill is not perfect, but it is the best shot at fixing our broken immigration system. And with deals already being made between supporters and those who had previously been detractors as part of the full Senate markup process, it’s clear that Senate leadership on both sides of the aisle is looking for a process which swiftly and judiciously moves the bill to a vote.
Last night’s developments are good news for those of us fighting for reform, but now is the time to step on the gas. The need for pressure on Senators to pass this bill and keep moving towards fixing our broken system is real, and it is immediate.
In league with organizations from across the political spectrum, including Organizing for Action, Consumer Electronics Association, Voto Latino, Silicon Valley Leadership Group and many more, Engine and March For Innovation are launching two days of initiatives across the Internet. Stay tuned to Engine for more news about the March, and what we’ll be doing afterwards as well. Join the March, follow us on Twitter and Facebook, and keep working. Your voices can tilt this debate, help guarantee the bill’s passage, and go a long way towards protecting innovation and building an immigration system that works here in America.
Photo courtesy of Talk Radio News Service.
Sumit Suman is the co-founder of Mentii, an online mentoring platform connecting successful mentors with aspiring young people. Sumit started the business both in New York and Bangalore in order to benefit from capital, talent and the market across two startup hubs. But, as the co-founder of Mentii, it was imperative that Sumit could work on the U.S. side. This is where the trouble began.
The whole visa process was an expensive distraction, especially during the early bootstrapped stage when the team needed to devote all their resources to finding and proving the market. After receiving a protracted Request For Evidence (RFE), where responding to it would have resulted in further legal expenses, Sumit had no choice but to withdraw his visa application. This is despite the fact that Mentii had already invested 40 percent of their total expenditure on immigration-related costs!
Now back in India, Sumit explains that his decision was the only option for his business; even if there was a legal (though uncertain) way to stay in the U.S. in order to grow the company, the cost of doing so was too prohibitive. While the Mentii team will still find a way to engage the U.S. market, and U.S. investors, the team will not be growing here -- in other words, no additional jobs will be created in America.
from Engine Advocacy on Vimeo.
If you have an immigration story to tell, email editorial@engine.is
Engine endorses the Senate “Gang of 8” proposal on comprehensive immigration reform. So, on behalf of more than 500 startup members and other startup companies across the U.S., we sent a letter of support to Chairman Patrick Leahy (D-VT), Ranking Member Charles Grassley (R-IA) and the members of the Senate Judiciary Committee.
We thought it prudent at this juncture to thank the Senators who have been working hard on this proposal. Going forward, we hope their good work will be the subject of robust debate and then we’ll look towards the swift passage of this bill as we march towards solving our nation’s broken immigration system.
The Judiciary Committee is the first stop on the bill’s journey to hopefully becoming law. The markup process that begins today will amend and refine the legislation into a bill that can pass in the Senate, and one that can also do real and permanent good for people and businesses across the country who are in need of a working immigration system.
As we’ve said before, you can take action as well by committing to remain a vocal participant in this process. You can sign up for the March for Innovation which is now only 11 days away. It is only with your voice that we’ll be able to make a difference on this issue, so sign up, get involved and let your voice be heard today.
Here’s the full text of the letter:
Dear Chairman Leahy and Ranking Member Grassley and members of the Committee,
I’m writing to you, on behalf of the startup community, in support of S. 744 -- the recent Comprehensive Immigration Reform proposal released by your Senate colleagues. Engine Advocacy represents more than 500 startup companies from all across the United States, and we believe the provisions in this bill would greatly benefit the startup community, and therefore the U.S economy as a whole.
New and young firms are responsible for all new net job growth since 1980, according to research from the Kauffman Foundation. In addition, our own Tech Works research projected that for every job created in the high-tech sector, 4.3 additional jobs will be created in the local goods and services economy, including barbers, lawyers, and health care professionals. Finally, with forty percent of Fortune 500 companies founded by immigrants, or the children of immigrants, it’s critically important that we safeguard the ability of the next generation of founders to start business here.
The proposed INVEST visa will directly benefit immigrant founders and entrepreneurs who want to start a business here, and already have the support of local venture capitalists. In addition, raising the H-1B visa cap, and expanding the green card system with merit-based visas for high-skilled immigrants, will also make it easier for startups to employ much needed workers. Taking into account recent developments, we also support Senator Hatch’s amendment to make the H-1B visa cap responsive to market demand.
We applaud the work already done by your Senatorial colleagues and look forward to a spirited debate, a robust amendments process, and the opportunity to be a resource for the committee and the Senate at large as the debate advances. In the end, the continued good work of this committee and of Congress can affect real and permanent good for our country -- helping to catalyze continued economic growth in our community, and opportunity for the country as a whole. Startups can power the next generation of growth in the American economy if we let them.
We hope that you will support this proposal that will lay the foundations for a prosperous future.
With thanks,
Michael McGeary
Co-Founder
Engine Advocacy
Photo courtesy of Talk Radio News Service.
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