Canada digital tax threatens global framework, startup competitiveness.
Startup News Digest 08/04/23
The Big Story: Bipartisan legislation to build AI resource for startups, researchers. A recently introduced bill would create government AI resources for startups and bolster needed talent in the field. The bipartisan bill—the Creating Resources for Every American To Experiment with Artificial Intelligence Act of 2023 (CREATE AI Act)—formally establishes the National Artificial Intelligence Research Resource (NAIRR) which will provide compute, datasets, and educational resources for startups, students, and academics. The legislation comes amid rapid growth of AI technology and will improve the competitiveness of U.S. startups.
Startup News Digest 06/30/23
The Big Story: Supreme Court strikes down Biden student loan relief plan. The Supreme Court this week struck down President Biden’s student loan relief plan that would have canceled up to $20,000 in student debt for qualified borrowers. The decision, while not unexpected, is a blow to the millions of Americans riddled with student debt, and individuals whose debt acts as a barrier to pursuing entrepreneurship.
Startup News Digest 06/09/23
The Big Story: Startups call on Congress to fix R&D expensing. Lawmakers in both chambers of Congress took steps this week toward addressing a critical tax issue impacting startups’ bottom lines: a recently enacted change to how startups expense research, development, and experimentation costs. House and Senate lawmakers held two hearings this week exploring how the tax code, including incentives around R&D impact small businesses and startups.
Startup News Digest 06/02/23
The Big Story: House passes capital formation bills. The House passed several bills this week to improve capital access for startups, including by providing educational resources on capital raising options for underrepresented small businesses and another to broaden the pool of potential startup investors.
Startup News Digest 05/26/23
Startup News Digest 05/19/23
The Big Story: Congress digs into recent bank failures. This week, committees in both chambers held hearings to examine recent bank failures, including the collapse of Silicon Valley Bank (SVB)—a key financial institution in the startup ecosystem. The collapse of SVB in particular devastated many across the innovation ecosystem, sending companies scrambling to withdraw funds and make payroll, uncertain if their full balances would be secured.
Startup News Digest 05/12/23
The Big Story: The difficulties of content moderation and the chance to try it yourself. Critics of the Internet industry, including policymakers, frequently complain about content moderation decisions and propose legislative changes that would make it harder for Internet companies to host, remove, demote, amplify, and curate user content. To help inform those conversations, Engine worked with Copia and Leveraged Play to develop a new video game this week—Moderator Mayhem—with the goal of highlighting the difficulties and the inherent tradeoffs Internet companies, especially startups, face while navigating moderating their users’ content.
Startup News Digest 05/05/23
The Big Story: “Children’s safety” push for more data collection, content scanning. Lawmakers reintroduced and advanced legislation that would push Internet companies of all types and sizes to collect more data from their users and scan public and private user content in the name of childrens’ safety. The bills—including the Kids Online Safety Act, the Children and Teens’ Online Privacy Protection Act, which were reintroduced this week, and the Eliminating Abusive and Rampant Neglect of Interactive Technologies (EARN IT) Act, which advanced out of the Senate Judiciary Committee this week—would remake the regulatory framework that enables startups to grow and succeed.
Startup News Digest 04/28/23
The Big Story: Over 65 startups call for uniform federal privacy law. This week, startups are calling on Congress to pass a federal privacy law that takes the startup ecosystem into account. A coalition of startups and support organizations across 26 states sent a letter to Congress urging lawmakers to pass a law that creates uniformity, promotes clarity, limits bad faith litigation, accounts for the resources of startups, and recognizes the interconnectedness of the startup ecosystem. The letter comes as states continue to enact their own unique data privacy laws, and as a Congressional committee explored the problems posed by a sectoral federal privacy landscape in a hearing this week.
Startup News Digest 04/21/23
The Big Story: Non-compete ban would boost the startup ecosystem. Policymakers received thousands of comments this week as a key agency considers a change that would make it easier for people to leave their jobs, including to found and join early stage startups. In conjunction with the Juelsgaard Intellectual Property and Innovation Clinic, Engine submitted comments this week to the Federal Trade Commission urging the agency to move forward with a proposed rule change that would ban most non-compete agreements, which are post-employment contracts that bar workers from taking up jobs with competitors for a prescribed period of time.
Startup News Digest 04/14/23
The Big Story: Policymakers set their sights on artificial intelligence. This week saw a frenzy of activity from policymakers around the globe looking to regulate artificial intelligence technologies, which startups are increasingly leveraging in their products. In the U.S., federal agencies recently kicked off processes to examine AI and intellectual property as well as AI accountability, while Congress is exploring legislation. Abroad, policymakers have used existing regulations to ban certain AI tools and are looking to adapt their proposed AI rules.
Startup News Digest 04/07/23
The Big Story: States continue adding to tech regulatory landscape risking additional burdens for startups. State legislative sessions are in high gear this spring, advancing tech legislation and threatening to grow a patchwork of varying rules startups must navigate as they grow. This week, for example, the Washington Senate passed a bill governing health information and other personal data. Their effort joins several other states putting forward proposals aimed at privacy and data security, online safety, and content moderation—that each will have noticeable ripple effects for startups.
Startup News Digest 03/31/23
The Big Story: R&D tax credit changes create tax bill for startups. Startups and other companies are facing higher taxes this year after a provision from a 2017 tax law went into effect recently. The law, the Tax Cuts and Jobs Act (TCJA), triggers a change to how the research and development (R&D) tax credit operates. Unless policymakers step in, startups and small businesses will have to weather the blow to their cash flow and may consider limiting future R&D costs. This could ultimately result in an overall reduction in innovation in the U.S., slowed economic growth, and decreased ability for our innovation ecosystem to compete with other countries.
Change to R&D treatment could shoulder startups with hefty tax bill
For many startups, this year’s taxes will reflect a detrimental change to the research and development (R&D) tax credit thanks to a bill Congress passed in 2017. Without a Congressional fix, small businesses and startups without deep pockets will be less able to weather the cash flow burdens resulting from the change, and some companies may be facing hefty tax bills and will table plans for future R&D.
Startup News Digest 03/24/23
The Big Story: New research shows state privacy patchwork costs startups hundreds of thousands. Startups spend hundreds of thousands of their limited resources on privacy compliance, much of which goes to duplicative activities that don't further users' privacy, according to a report Engine is releasing today. The report, Privacy Patchwork Problem, chronicles the steps startups are taking to protect the data of their users and enumerates the costs, burdens, and barriers startups encounter—which reach into the hundreds of thousands of dollars. It underscores the need to give for a federal privacy framework that creates uniformity, promotes clarity, and accounts for the resources of startups, while creating consistent rights for their users located in every state across the country.
SVB: what happened, how the fallout impacts startups, what policymakers can do next
The fall of Silicon Valley Bank (SVB) dealt an immediate shock to the global startup ecosystem and will have lasting ramifications for banks and founders. Many startups lack access to large banks, and instead rely on community and regional banks to meet their needs. SVB in particular was uniquely situated to support the startup ecosystem, offering more favorable terms for loans and connections for founders. But the fall of SVB has led to concerns that other banks may suffer similar fates, and at the same time has brought to the forefront the risk inherent to the startup ecosystem.
Startup News Digest 03/17/23
The Big Story: SVB fallout puts startup banking needs in the spotlight. In the wake of last week’s collapse of a key startup-facing bank, many in the startup ecosystem are concerned about the banking options and funding landscape for startups across the country. Last week, California regulators and the Federal Deposit Insurance Corporation (FDIC) shuttered and placed into receivership Silicon Valley Bank (SVB), a mainstay bank for the global startup ecosystem. At the same time, startups scrambled to move funds and were unsure if they’d have the capital to pay their employees this week.
Startup News Digest 03/10/23
The Big Story: Broad, diverse coalition underscores importance of Section 230. This week, Engine joined more than three dozen public interest organizations, academics, free expression advocates, industry associations, and companies in a letter highlighting the value of Section 230 in enabling users, community building, and expression online. The letter was sent to members of the Senate Judiciary Subcommittee on Privacy, Technology, and the Law ahead of a hearing Wednesday on Section 230, a foundational Internet law that enables platforms of all sizes to host and moderate user content without risking ruinous liability.
Startup News Digest 02/10/23
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.
