 "Start-up leaders embrace lobbying as part of the job")
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 centre 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 labour. And Marcela Sapone, the company's chief executive, has made two trips to Capitol Hill to urge lawmakers, research organisations and the political press to rethink labour laws for the digital age.
"We have old rules about how you act as an employer," said 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 lobbying spending, 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.
©2015 The New York Times News Service
This year, the start-up has received attention of a different sort, for being at the centre 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 labour. And Marcela Sapone, the company's chief executive, has made two trips to Capitol Hill to urge lawmakers, research organisations and the political press to rethink labour laws for the digital age.
"We have old rules about how you act as an employer," said 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 lobbying spending, 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.
©2015 The New York Times News Service