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Though it may seem as if politicians in Washington, D.C. have a hard time agreeing on anything, those on both sides of the aisle seem increasingly keen to support entrepreneurs and their communities. Some recent examples include the passage of legislation expanding crowdfunding under the JOBS Act and meetings similar to one hosted last month by the Global Accelerator Network in which we worked with the Small Business Administration to gather 16 accelerators to demo their programs for the White House and SBA funders.
Much progress has been made to ensure that those in Washington are hearing entrepreneurs’ concerns, but we still have a long way to go – especially with connecting politicians to those in the seed-stage technology sector. Politicians in our federal government are listening to entrepreneurs, but we very rarely see congressmen personally sit across the table from early-stage tech investors and their founders. When this does occur, however, representatives learn much more about what startups really want and need than they would hearing feedback through second or third parties, and they’re much more likely to take supportive action.
That is why the Global Accelerator Network is thrilled to support the first ever Startup Day Across America on August 29. This one-day bipartisan event, led by the U.S. House of Representatives Caucus on Innovation and Entrepreneurship, will connect members of Congress with startups and accelerators in their respective districts. We believe this is a great opportunity for startup communities to connect with their congressional representatives – both to highlight the positive contributions startups bring to their communities, as well as raise awareness about startups’ needs on a local and national level.
If you are interested in learning more about the Startup Day Across America, please contact Eve Lieberman in Congressman Jared Polis’ office who will connect you with the person leading the charge in your district.
The JOBS Act, which was approved by Congress and signed by President Obama with much fanfare over a year ago, was intended to help small business. It is, after all, called the Jumpstart Our Business Startups Act. A number of the provisions have been slow to get written into law and the SEC has missed their deadlines on a bunch of stuff, including the often talked about equity crowdfunding activity.
Recently, the SEC weighed in on a number of the things they were required to with much fanfare. Fred Wilson wrote Let The Games Begin in response to the SEC lifting the General Solicitation Ban. However, Fred, and many others, missed the new proposed Amendments to Regulation D, Form D and Rule 156 under the Securities Act. And they look like one scary mess that could undermine the whole thing if approved.
Some posts with analysis of this have finally started to appear. A good summary is by Joe Wallin at his Startup Law Blog titled Proposed Rules Hard on Startups. And I’ve gotten a number of emails with similar analysis. My favorite summary was from a very experienced law firm.
“The SEC giveth (as mandated by Congress) and taketh away (by its own mandate).
It is incredible that the SEC finally got around to implementing rules to remove the ban on solicitation (as it was required by statute to do so in 2012), but concurrently proposes new rules intended to retard the benefits of easing the capital formation process (the goal of the JOBS Act).
The new proposed rules will require a Form D to be filed 15 days in ADVANCE of a Reg 506 offering and after, substantially expand the scope of information required to be disclosed in Form D and disqualify an issuer from relying on Rule 506 for one year if the issuer does not comply with the new filing requirements (including a requirement that the Form D be timely filed). The new rule also would require filing with the SEC of all written general solicitation materials. So much for deregulation!”
Seriously? More commentary from one of the emails I received follows:
“The new rules and rule proposals were a kind of packaged effort to address the Congressional mandate in the JOBS Act, while attempting to maintain investor protection. Apparently, the package was enough to mollify Commissioner Walter, but Commissioner Aguilar was unwilling to go along. In his view, the rules adopted come at the expense of investor protection. He reiterated that the record supports the argument that elimination of the ban on general solicitation will facilitate fraud and viewed the adoption of the rules without appropriate safeguards as “reckless.” He also contended that the proposal to study the practical effects and then adopt rules if necessary would come too late – closing the barn door after the horses have already escaped. Although he voted for adoption of the disqualification rule, he also objected to the narrowing of the categories of individuals covered, as well as the application to only prospective events, especially given the two-year delay in adoption of the final rule. On the other side of the aisle, Commissioners Paredes and Gallagher both objected to the proposal to facilitate monitoring of market changes resulting from elimination of the prohibition. They both viewed the proposal as placing an undue burden on capital formation and undermining the objectives of the JOBS Act.”
While the “proposed rules” are still “proposed”, hopefully the SEC will reject these new proposals, especially in the context of Congress’s mandate to Jumpstart Our Business Startups.
I woke up to a flurry of grumpy stuff about our government intermixed with lots of posts wishing everyone a happy 4th of July. The dissonance of it bounced around in my head for a while and – when I was on my walk with Amy and Brooks the Wonder Dog – I finally asked Amy a few questions to calibrate my reaction to some of the stuff I had read this morning.
For example, in the “you’ve got to be fucking kidding me category”, the U.S. Postal Service Is Logging All Mail for Law Enforcement. I don’t send physical mail anymore (except for the occasional post card to a friend or thank you letter) so I’m not sure I care, but then I realized all my post cards were probably being scanned into a computer somewhere and I shouldn’t be writing messages like “The NSA Is Spying On You” on my postcards (or on blog posts, for that matter.)
Then there was this awesome, long post on TechDirt by Rob Hager titled Snowden’s Constitution vs Obama’s Constitution. It does an outstanding job of explaining the Snowden situation in the context of the Fourth Amendment and the concept of reasonableness. And there are some great hidden gems in the article, such as the notion that Hong Kong is rated above the US for “rule of law” and “fairness of its judiciary system.” Oops.
“By international standards, the US and its judiciary rank below Hong Kong on a 2012-13 rule of law index . While American propagandists routinely imply that the US system is a paragon against which all others must be measured, in fact, objectively, Hong Kong ranks #8 and #9 respectively on absence of corruption and quality of its criminal justice system, well ahead of the US’s #18 and #26 rankings . The World Economic Forum – which certainly suffers no anti-US or general anti-plutocrat biases — ranks Hong Kong #12 in its 2012-13 index on judicial independence. That is substantially higher than the appallingly low US ranking of #38 on the same index, which is proportionately not that far ahead of China’s #66 ranking. If due process was his priority, Snowden was clearly no fool in choosing sanctuary in Hong Kong, though he is aware of the coercive and corrupting power that the US can and does bring to bear on virtually any country. Though China is better situated than most to resist such pressure, it appears that even China preferred not to pay the cost. Or perhaps his security could not guaranteed as effectively in Hong Kong as in Moscow, for the time being.”
“Journalism is not content. It is not a noun . It need not be a profession or an industry. It is not the province of a guild. It is not a scarcity to be controlled. It no longer happens in newsrooms. It is no longer confined to narrative form.
So then what the hell is journalism?
It is a service. It is a service whose end, again, is an informed public. For my entrepreneurial journalism students, I give them a broad umbrella of a definition: Journalism helps communities organize their knowledge so they can better organize themselves.”
After our walk Amy sent me another article about the Fourth Amendent - If PRISM Is Good Policy, Why Stop With Terrorism? that included additional applications of PRISM to child pornography, speeding, and illegal downloads.
Then I noticed my friends at Cheezburger supporting the latest Internet Defense League Standing Up for The Fourth Amendment campaign, which as a member of the Internet Defense League, I also support.
After all of this, I was able to convince Amy to go to see White House Down with me this afternoon. I love going to afternoon movies, and it’s awesome to live in a country that not only shows a movie like this, but allows it to get made!
Happy 4th of July. For all of its flaws, America is an amazing and resilient country and I’m proud to be an American.
Near the end of the week last week, the lastest “the US government is spying on US citizens” scandal broke. For 24 hours I tried to ignore it but once big tech companies, specifically Facebook, Google, and Yahoo, started coming out with their denials about being involved in PRISM, I got sucked into all the chatter. I was able to ignore it yesterday because I took a digital sabbath but ended up reading a bunch of stuff about it this morning.
While I’m a strong believer in civil liberties and am opposed to the Patriot Act, I long ago gave up the notion that we have any real data privacy. I’ve regularly fought against attempts at outrageous new laws like SOPA/PIPA but I’m not naive and realize that I’m vastly outgunned by the people who want this kind of stuff. Whenever I get asked if I’ll write huge checks to play big money politics against this stuff, I say no. And recently, I’ve started quoting Elon Musk’s great line at the All Things Digital Conference, “If we give in to that, we’ll get the political system we deserve.”
I read around 50 articles on things this morning. I’m no more clear on what is actually going on as the amount of vagueness, statements covered with legal gunk, illogical statements, and misdirection is extraordinary, even for an issue like this one.
Following are some of the more interesting things I read today.
- We are shocked, shocked…
- Government Says Secret Court Opinion on Law Underlying PRISM Program Needs to Stay Secret
- It’s our own fault… Deal with it.
- Tech Companies Concede to Surveillance Program
- Is the NSA outsourcing its domestic spying to Israel?
- Nothing To Hide
- No One Is Talking About The Insane Law That Lets Authorities Read Any Email Over 180 Days Old
- Room 641A
- What If China Hacks the NSA’s Massive Data Trove?
And I always thought PRISM was about teleportation.
And finally, the Wikipedia article, like all Wikipedia articles, is the definitive source of all PRISM information at this point, at least to the extent that anything around PRISM is accurate.
I’ve regularly blog about patent trolls harassing startups and impeding innovation, the experiences of immigrant founders, and the battle for a free internet. While I’m fortunate to have this blog, and other writing opportunities as a platform to give voice to these stories, I also realize that to really have a meaningful impact, we need the startup community to be involved in government.
That’s where Engine Advocacy comes in. A few months ago, I joined the Advisory Board of Engine to lend my support to an organization that is doing amazing work for the startup ecosystem. We’re trying to create a startup community that can mobilize to make the government listen and understand the issues that have a unique impact on our community.
Here’s an example of great work that Engine has done: During the fight against SOPA/PIPA last year it seemed to a lot of outsiders that the internet community’s reaction happened overnight. What many people don’t know is that there were hundreds of organizations and businesses working together for months to make that one-day blackout so impactful. Engine connected 15,000 calls from individuals to their Senators that day. The sheer volume of calls shut down the Senate switchboard, twice.
Engine is always monitoring the issues, doing great research, keeping members informed so that we can identify any threats early, and respond as a community. There are many ways that startups can get involved, perhaps the simplest being just keeping up-to-speed on tech policy.
At the end of this month, Engine is bringing startups to Washington, D.C. to talk to lawmakers about issues that are really important to the startup community — issues like immigration, software patent reform, and keeping the internet free and open. You can get involved by becoming an Engine member today. Go to D.C. with them. Send them your stories.
Ultimately, we’re not just Silicon Valley, or Boulder., or any other geographically-defined tech scene. We’re a powerful community that is creating jobs and improving the economy — basically, doing all of those things that Senators and Members of Congress talk about making happen. It’s time they listened to us. Let’s make the startup community a stronger voice in Washington.