Start-Up Leaders Embrace Lobbying as Part of the Job

26-11-2015
WASHINGTON — Last year, the personal butler service Hello Alfred won a top prize in Silicon Valley created for promising new technology start-ups, putting the company on a path toward millions of dollars in investment.
This year, the start-up has received attention of a different sort, for being at the center of a national debate about the rights of the workers hired through its service and others like it.
Unlike start-ups of years past, though, Hello Alfred has not shied from the political stage. Its leaders have appeared on numerous policy panels and have written op-eds. They have been invited to a White House summit event on the future of labor. And Marcela Sapone, the company’s chief executive, has made two trips to Capitol Hill to urge lawmakers, research organizations and the political press to rethink labor laws for the digital age.
“We have old rules about how you act as an employer,” said Ms. Sapone, 29, who started Hello Alfred with a Harvard Business School classmate. “We are a young company but we also have to make decisions early that are ethical and business-oriented, and that means engaging in Washington early.”
The efforts by Hello Alfred underscore how today’s tech companies — even the youngest ones — have accepted lobbying as an essential part of doing business. In addition to knowing the language of computer code, founders are speaking the language of Washington, keenly aware of the potential regulatory battles that could be on the horizon.
The examples are suddenly legion. Magic Leap, an augmented reality start-up, does not have a product on the market — but its lobbyists are promoting what the company may eventually do. Zenefits, an online benefits manager, is only two years old but is a member of two trade groups and has hired lobbyists and public relations strategists from the Obama administration. The chief executive of Handy, an on-demand household chores service, was recently in Washington on his third charm offensive with lawmakers.
It is a sharp shift from past generations of tech companies, whose founders almost made it a point of pride to be distanced from, or above, politics and politicians. The antitrust troubles and headaches encountered by the older companies, including Microsoft and Google, play some role in the new thinking. The real change, though, came after Uber, the ride-hailing service, and Airbnb, the home-sharing site — two of the largest start-ups — started facing a barrage of questions about their operations.
“For these new companies, the scale of innovation is so big and impactful they necessitate interacting with Washington writ large,” said Kenneth Baer, a former spokesman for the Office of Management and Budget who now advises Zenefits. “There are huge amounts of questions that society has to grapple with that didn’t exist before.”
It is difficult to say whether all the early lobbying is delivering results. So far, it has at least allowed Uber and Airbnb to continue growing. But the arrival of money from tech companies so early in their life cycles has definitely shaken up K Street, the capital’s thoroughfare for lobbyists.
While total annual spending on lobbying has decreased slightly over the last five years, Internet companies have tripled their lobbyingspending, to $47.5 million, during the same period. The industry now spends just a little less than the auto sector, according to the website OpenSecrets, which tracks lobbying and campaign finance.
Much of that money is still from the biggest tech companies; Google and Facebook, for example, spend millions each. But in a sign of how many new companies have come to town, one trade group, the Internet Association, has tripled its membership in the last three years. And a cottage industry has emerged of boutique Internet lobbying; crisis public relations; and niche trade associations for drones, digital health services and financial technology.
“There are few industries like the Internet for which a rise in expenditures has been so dramatic,” said Sheila Krumholz, the executive director of the Center for Responsive Politics, which runs OpenSecrets.org. “They are now engaged in a number of battles where they see opportunities to push legislation or fend against legislation.”
The companies’ reach extends beyond Washington, too, with Uber and Airbnb placing lobbyists in hundreds of cities around the world. They are also putting their weight behind city and state lobbying efforts to overturn transportation, insurance and hospitality regulations that stand in their way.
For many start-ups, though, the immediate goal of lobbying is simply to create good will.
Coinbase, a digital currency platform based in San Francisco, is one of a number of financial start-ups that have looked for help in Washington, knowing that finance is highly regulated. Last year, it hired John Collins, a former senior adviser to the Senate Homeland Security and Governmental Affairs Committee, as employee No. 50.
As the head of government affairs for Coinbase, Mr. Collins regularly prepares talking points about the Bitcoin virtual wallet and meets with officials at the Treasury Department, Consumer Financial Protection Bureau, Federal Trade Commission and multiple congressional committees. Nearly every month, he escorts the company’s chief executive, Brian Armstrong, to meetings with government officials.
“So much of what I do day in and day out is not even advocating for anything necessarily but talking to folks about the technology,” Mr. Collins said.
The standard mantra of tech companies is that they are a boon to the economy and improve the lives of consumers. The underlying message is that any changes by regulators could cast painful ripples across the economy.
The Internet Association has taken that message straight to the congressional districts of key lawmakers. Last year, the group hosted Representative Fred Upton, Republican of Michigan and chairman of the House Energy and Commerce Committee, on a talking tour in downtown Kalamazoo to meet shop owners who had been primed to extol the virtues of the Internet.
A jewelry store owner talked about her ability to connect inexpensively with suppliers online. Bridgett Blough, the owner of a food truck, talked about how she used the web to connect with customers, and warned that regulations would make it harder to run her business.
“These businesses may not have been businesses without the Internet,” Mr. Upton said in a video on the trade group’s website. “We don’t need to regulate the Internet. It’s not a problem as long as it’s not regulated.”
Another selling tactic is welcoming government leaders to Silicon Valley, in the hope that whimsical office spaces and over-the-top employee perks will impress Washington bureaucrats. In just the last six months, Andreessen Horowitz, a leading investor in start-ups, has hosted Defense Secretary Ashton B. Carter, dozens of members of Congress, state attorneys general, and leaders from the Federal Communications Commission and the Federal Trade Commission.
“For our start-ups, the advice we give is to get in early,” said Ted Ullyot, a former adviser to President George W. Bush, who is now at Andreessen Horowitz, “because the idea is not to stop regulation at a later date but to make sure they were aware and thoughtful about regulation early on.”
Perhaps no issue has become more of a focal point than the working conditions at so-called on-demand companies — businesses like Uber and Alfred, which enable customers to request a service at the touch of a button.
Senator Mark Warner, Democrat of Virginia, has been one of the more vocal lawmakers on the issue and has expressed concern that freelance workers lack benefits that ensure long-term economic stability. Senator Warner has said his main concern is about whether contract workers, some of whom work dozens of hours a week, will have basic protections without classic employment contracts.
In the last six months, his office in Washington has had a steady stream of visitors, including the chief executive of Airbnb, Brian Chesky; venture capitalists; and more than 100 lobbyists for start-ups. Many of them have argued against such a classification change, saying that the costs of providing full employee benefits are too high and that their workers mostly clock part-time hours.
Unlike Uber and Instacart, Hello Alfred from the beginning categorized its workers as employees; they complete W-2 income tax forms and are entitled to benefits, training and job security.
But most of its 250 employees hold their butlering jobs to supplement other income. And Ms. Sapone says she wants lawmakers to consider new regulations that would relieve companies from providing some costly benefits.
“Why are we engaging so early? Mostly because we had to,” she said. “We have no choice but to get into these conversations.”

Bron: The New York Times, 23 november 2015

Lokale lobbyisten vaak druk met andere thema's dan de lokale politiek

06-12-2017 Consultancy.nl schreef onlangs een artikel naar aanleiding van het onderzoek dat de Universiteit van Amsterdam samen met ons uitvoerde naar de lobby op lokaal niveau. Het artikel is hier terug te lezen. 
Verder lezen »

Pleidooi voor lobbyregister Gemeente Rotterdam

05-12-2017 Er moet een lobbyregister komen voor gemeenteraadsleden en het bestuur van Rotterdam. Hiermee moet duidelijk worden welke grote partijen invloed hebben op de besluitvorming. Het moet duidelijk worden met welke lobbyisten bijvoorbeeld gemeenteraadsleden hebben gesproken, alvorens ze een beslissing te namen. 
Verder lezen »

Verslag lobbyseminar 2017 nu ook digitaal beschikbaar

15-11-2017 Wat is de staat van de lobby op lokaal niveau? Wat zijn verschillen en overeenkomsten tussen belangenbehartiging in de gemeente en in “Den Haag”? Ten overstaan van zo’n 175 aanwezigen werd op 26 oktober 2017 het onderzoek ‘Lang leve de lokale lobby?!’ gepresenteerd tijdens het jaarlijkse lobbyseminar van Public Matters. Onderstaand leest u het volledige beslag. De digitale publicatie van het onderzoek is hier in te zien en te downloaden als PDF-bestand. 
Verder lezen »

Wat bedrijven, veel banken - én een gezamenlijk aanbod van VNO-NCW en Greenpeace: dit waren de 750 lobby's

13-11-2017 Werkgeversorganisatie VNO-NCW en Greenpeace hebben op initiatief van voormalig PvdA-leider Diederik Samsom de afgelopen maanden een aantal malen overlegd over verdere verduurzaming van de energievoorziening. Samsom had ook de leiding over die besprekingen.
Verder lezen »