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95–579 2015

MODERN TOOLS IN A MODERN WORLD: HOW 

APP TECHNOLOGY IS BENEFITTING SMALL 

BUSINESSES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON HEALTH AND TECHNOLOGY 

OF THE

COMMITTEE ON SMALL BUSINESS 

UNITED STATES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD 

JULY 23, 2015 

Small Business Committee Document Number 114–021 

Available via the GPO Website: www.fdsys.gov 

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Congress.#13
(II) 

HOUSE COMMITTEE ON SMALL BUSINESS 

STEVE CHABOT, Ohio, Chairman 

STEVE KING, Iowa 

BLAINE LUETKEMEYER, Missouri 

RICHARD HANNA, New York 

TIM HUELSKAMP, Kansas 

TOM RICE, South Carolina 

CHRIS GIBSON, New York 

DAVE BRAT, Virginia 

AUMUA AMATA COLEMAN RADEWAGEN, American Samoa 

STEVE KNIGHT, California 

CARLOS CURBELO, Florida 

MIKE BOST, Illinois 

CRESENT HARDY, Nevada 

NYDIA VELA ́ ZQUEZ, New York, Ranking Member 

YVETTE CLARK, New York 

JUDY CHU, California 

JANICE HAHN, California 

DONALD PAYNE, JR., New Jersey 

GRACE MENG, New York 

BRENDA LAWRENCE, Michigan 

ALMA ADAMS, North Carolina 

SETH MOULTON, Massachusetts 

MARK TAKAI, Hawaii 

KEVIN FITZPATRICK, Staff Director 

STEPHEN DENNIS, Deputy Staff Director for Policy 

JAN OLIVER, Deputy Staff Director for Operation 

BARRY PINELES, Chief Counsel 

MICHAEL DAY, Minority Staff Director 

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(III) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Hon. Aumua Amata Coleman Radewagen ............................................................ 1 

Hon. Seth Moulton ................................................................................................... 2 

WITNESSES 

Mr. Morgan Reed, Executive Director, ACT / The App Association, Washington, DC ............................................................................................................. 4 

Mr. David Barrett, CEO, Expensify, San Francisco, CA ...................................... 6 

Patricia G. Greene, Ph.D., Paul T. Babson Chair in Entrepreneurial Studies, 

Babson College, Babson Park, MA ..................................................................... 7 

Ms. Cassie Gray, Owner, ShopClementine, Ashfield, MA .................................... 9 

APPENDIX 

Prepared Statements: 

Mr. Morgan Reed, Executive Director, ACT / The App Association, Washington, DC ..................................................................................................... 15 

Mr. David Barrett, CEO, Expensify, San Francisco, CA ............................... 31 

Patricia G. Greene, Ph.D., Paul T. Babson Chair in Entrepreneurial 

Studies, Babson College, Babson Park, MA ............................................... 40 

Ms. Cassie Gray, Owner, ShopClementine, Ashfield, MA ............................ 45 

Questions for the Record: 

None. 

Answers for the Record: 

None. 

Additional Material for the Record: 

None. 

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(1) 

MODERN TOOLS IN A MODERN WORLD: HOW 

APP TECHNOLOGY IS BENEFITTING SMALL 

BUSINESSES 

THURSDAY, JULY 23, 2015 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON SMALL BUSINESS, 

SUBCOMMITTEE ON HEALTH AND TECHNOLOGY, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:00 a.m., in Room 

2360, Rayburn House Office Building. Hon. Aumua Amata Coleman Radewagen [chairwoman of the subcommittee] presiding. 

Present: Representatives Radewagen, and Moulton. 

Chairwoman RADEWAGEN. Good morning. I call this meeting 

to order. 

Good morning. I want to welcome all of you to this hearing of the 

Small Business Subcommittee on Health and Technology. It is an 

honor to chair this Subcommittee, and I look forward to continuing 

the work we are doing to improve opportunities and growth for the 

nation’s small businesses. 

Today, we will be examining apps which are applications of technology accessed on smartphones and other portable handheld devices. U.S. demand for mobile data grew by 63 percent in 2014, and 

is expected to increase sevenfold by 2019. Since 2007, the United 

States has seen more than 750,000 app economy jobs created. An 

astonishing 77 percent of the apps are made by startups, or small 

companies, and nearly 80 percent of these companies are located 

outside of Silicon Valley. And this industry is steadily growing. 

Findings predict that the app economy will reach 151 billion by 

2017. 

App technology provides businesses and consumers with fast, 

viable solutions to everyday problems, and research shows it is the 

entrepreneur due to an ability to remain flexible in a quickly 

changing market environment who is leading the development of 

these innovative apps. Developers are producing apps that integrate home automation systems, track and monitor health statistics, offer budget and financial transaction tools, and allow consumers to have their groceries purchased and delivered. 

The continued impact that the app industry will have on the 

United States’ economy are significant, and we must help foster 

that growth. In fact, more than 20 percent of all apps sold in China 

were developed by American businesses. This is a perfect illustration of the potential growth for the industry. 

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I also want to touch on the implications app technology provides 

for underserved regions, such as my district, American Samoa. Entrepreneurs in the farthest corners of American can tap into the 

app industry, and our residents are among the innovators. For instance, a Pago Pago native from my district developed a photo app 

that allows users to add Polynesian cultural filters and designs to 

their photos before sharing them. 

I want to thank the witnesses for being here today to help us examine and further understand the implications app technology can 

have on the economy. 

I now yield to the ranking member for his opening statement. 

Mr. MOULTON. Thank you, Chairman Radewagen, for holding 

this important hearing. Thank you also to our witnesses, especially 

Cassie Gray, a small business owner who traveled from Massachusetts to be here today. Creative entrepreneurs like Cassie make our 

economy stronger, and we need their input to ensure the laws we 

make are working for every day Americans. 

There is no question that technology has changed every facet of 

the American economy. Think about it. Only a few years ago it 

would be hard to imagine how much we could accomplish from a 

device that fits comfortably in our pockets. This hearing comes at 

an appropriate time. Research shows that entrepreneurship among 

Americans is declining, an alarming trend. In her testimony, Ms. 

Gray describes the Etsy platform as a ‘‘onramp to entrepreneurship.’’ For our economy to truly improve, we need more onramps to 

entrepreneurship, and technology, like mobile apps, can help lead 

the way. 

Today, entrepreneurs are building entire business models around 

smartphone applications. New forms of commerce are emerging 

daily as the web becomes an increasingly mobile platform. Small 

business owners use social networks, like Facebook, Instagram, 

and Twitter, to market their products. Americans now use 

smartphones, tablets, and other handheld devices to do everything 

from ordering groceries to booking travel arrangements, to sharing 

photos, to monitoring their health and fitness. Our economy is 

stronger and more efficient as a result of these innovations. 

Not only are entrepreneurs developing innovative apps, but more 

traditional businesses are harnessing wireless technology to reach 

new markets and serve existing customers more efficiently. Nearly 

two-thirds of small businesses now say it would be difficult to continue operating without the use of wireless technology. Thirty percent of firms with fewer than 20 employees utilize mobile applications as part of their business model, and small companies are saving 275 million employee hours a year through the innovative uses 

of wireless technology. 

As mobile web platforms become more integral to the American 

economy, Congress, the FCC, and other agencies will encounter a 

number of regulatory challenges that must be addressed. As Cassie 

will demonstrate in her testimony, one of the most basic challenges 

is ensuring widespread access to broadband. Today, the Federal 

Communications Commission reports that 95 percent of small firms 

have broadband connectivity. This constitutes important progress 

but more work must be done. In particular, there remains a signifiSBREP-219 with DISTILLER

3 

cant gap between rural areas like western Massachusetts and large 

cities. 

Ensuring universal broadband access is vital to promoting commerce. In that regard, programs like the Rural Utility Service and 

the Universal Service Fund will remain critical to economic development in traditionally underserved communities. This Committee 

has an important role to play in ensuring that as those initiatives 

evolve and are reformed, the needs of small and micro businesses 

are kept in mind. 

Entrepreneurship and innovation are two traditions that have always made our country an economic leader. That remains the case 

today as small businesses are on the leading edge of developing 

new apps and utilizing them to expand their market share and find 

new efficiencies. As always, this Committee has an important role 

to play in ensuring that policy changes in this area provide the appropriate degree of regulation and consumer protection, while allowing the space for maximum amount of innovation and growth. 

Before I close my remarks, I want to take a moment to acknowledge another witness, Patty Greene. Ms. Greene is the academic director of the Goldman Sachs 10,000 Small Business Program at 

Babson College in Massachusetts. This program has benefitted 

small business owners throughout the country, throughout Massachusetts, and throughout the Sixth District. It is wonderful to have 

her with us here today. 

On that note, I would like to thank all the witnesses for being 

here to share their valuable perspectives, and I yield back the balance of my time. 

Chairwoman RADEWAGEN. I would like to take a moment to 

explain the timing lights for you. You will each have five minutes 

to deliver your testimony. The light will start out as green. When 

you have one minute remaining, the light will turn yellow. Finally, 

it will turn red at the end of your five minutes. I ask that you try 

to adhere to that time limit. 

Our first witness this morning is Morgan Reed, executive director at ACT, The App Association, where he specializes in application development issues. Mr. Reed has testified in both the House 

and Senate chambers, and has authored several white papers on 

app development. He also serves on the Advisory Council of the 

Mobile Health Information Management Systems Society. 

Our next witness is Dr. Patricia Greene. Dr. Greene is the Paul 

T. Babson chair in Entrepreneurial Studies at Babson College. Before joining Babson, she chaired entrepreneurial and leadership 

programs at the University of Missouri, Kansas City, and Rutgers 

University. She is also a member of the National Advisory Board 

for the Small Business Administration’s Small Business Development Center. 

Next, we have David Barrett, the founder of Expensify, a complete online expense management service. He started programming 

when he was six-years old, and it has been his primary activity 

ever since. With a brief hiatus for project management, technical 

writing, and world travel. 

Finally, we have Ms. Cassie Gray, owner of ShopClementine, an 

Etsy shop that she runs out of her home in Massachusetts. Ms. 

Gray creates minimalist jewelry using recycled silver, reclaimed 

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gold, and gemstones, and diamonds. What started as a hobby has 

developed into a nine-year-long career through online sales. Ms. 

Gray, thank you for being with us today. 

Mr. Reed, you have five minutes. 

STATEMENTS OF MORGAN REED, EXECUTIVE DIRECTOR, ACT/ 

THE APP ASSOCIATION; PATRICIA G. GREENE, PH.D., PAUL T. 

BABSON CHAIR IN ENTREPRENEURIAL STUDIES, BABSON 

COLLEGE; DAVID BARRETT, CEO, EXPENSIFY; CASSIE GRAY, 

OWNER, SHOPCLEMENTINE 

STATEMENT OF MORGAN REED 

Mr. REED. Thank you. 

Chairwoman Radewagen, Ranking Member Moulton, and distinguished members of the Committee, my name is Morgan Reed, and 

I am the executive director of ACT, The App Association. I thank 

you for holding this important hearing on the impact of the app industry on mobile innovation for small businesses. 

We represent more than 5,000 companies that create the apps 

used on smart devices around the globe. My goal today is to highlight the remarkable growth of the app industry and where it is 

headed. 

We have three key findings for the Committee. First, app companies are succeeding in every region of the country, as you have all 

pointed out. Two, the growth of the app economy provides access 

to technology previously out of reach from many small business 

owners in rural and underserved communities. And three—here is 

where I am going to predict the future a little bit—the future of 

the app economy, including in your districts, will be in financial, 

enterprise, and in health. 

In 2008, The App Store launched with only 500 apps. In seven 

years, the number of apps now exceeds four million across several 

different platforms, and the app economy has emerged as a $120 

billion marketplace. Our industry research has consistently found 

that more than three-quarters of the top grossing apps are made 

by small companies, and 80 percent are based in the U.S. And as 

you noted, 77 percent are based outside of Silicon Valley. And 

while we all love Silicon Valley, I think it is a very important 

thing, especially as we are sitting on this Committee, to understand that spread and that capability that the app economy is producing. 

But, you know, those are just numbers, so let us get a little bit 

more specific. 

Chairwoman, you have already mentioned the app is called 

Kavagram, and it is done by a gentleman, Sonny Stevenson. And 

he did it, as you pointed out, to spread Polynesian artwork, allowing you to edit photos, decorate them with designs and images. It 

really borrows from the Instagram theme, and it has really been 

a huge hit. Several NFL players have been using it and putting out 

some pretty amazing photos using the app from Sonny. 

Ranking Member Moulton, you have one of my favorite app companies in your district. It is called Playrific. With more than 50 employees, Playrific builds amazing kids’ apps, like Pink Chillies, the 

Magical Elephant Game, which lets you build puzzles, test your 

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memory. They are doing just a great job in a really safe environment for kids, and it is worth pointing out, 50 employees is a real 

job creator. 

More importantly, every single one of your districts has a bricksand-mortar small business that is using mobile to manage their 

point of sale, to manage their expenses, to help with customer relations, and improve customer service in the field. 

Now, the future of that mobile app economy is not necessarily 

just in those apps in the store but in the apps being used in your 

place of business. If you think of it this way, your mobile device 

then becomes the place in the repository for all of your information 

on your customer, something called customer relations management. It tells you when you last met with them, what was your 

sale. When you go into that meeting with a customer, you possess 

in your hands for the first time what did they last buy? When did 

they last talk to you? All of that information that makes for rich 

customer relations can be right in front of you on your mobile device. Your training documents, and as we say most importantly, 

your sales material for that next big deal. 

Now we step to the next place in health. Right now, we all know 

about wearables. I think at least three of the four of us have 

wearables on right now. And what we know about them is that 

your wearable device collects amazing information. But your next 

step is your doctor is going to speak to you through an app, and 

they are going to be able to see in near real time, the information 

off your wearable. And God forbid you are in an ambulance. The 

ambulance will be able to send information to the emergency room 

via an app called Airstrip, which is already in the market, to keep 

tabs on your vitals, to make sure your emergency room is ready the 

moment you land. 

Well, what makes these apps possible? There is some obvious 

stuff—the network, devices, storefronts—but I would say the biggest element is trust. Cloud technology that provides remote data 

storage is the lifeblood of the mobile economy. It allows users to access and share from any location. 

And if trust is a key building block, then loss of trust is the destructive kryptonite. Small businesses must be able to protect the 

data of their customers whose trust they have worked so hard to 

earn, so strong encryption, something, by the way, OPM did not 

have, is critical. We ask that you take seriously any government efforts to weaken security measures. 

Just as troubling, the Department of Justice is currently requiring American companies to break the law overseas, forcing them to 

give data stored on foreign nationals at datacenters abroad without 

approval of the host country. We encourage you to support the 

LEEDS Act, which would provide a clear legal framework for law 

enforcement agencies. 

And finally, while small businesses must have the ability to protect their intellectual property, they also need help pushing back 

on patent abusers. H.R. 9, the Innovation Act, restores trust by including strong measures to ensure transparency in patent ownership, clarify what is and is not infringement, and allow defendants 

to recover legal costs. 

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I thank you again for the opportunity to testify, and I look forward to your questions. 

Chairwoman RADEWAGEN. Now, Mr. Barrett. 

STATEMENT OF DAVID BARRETT 

Mr. BARRETT. All right. Hello, everyone. I am going to be the 

least slick speaker here. I have never done this before, but it is 

quite exciting. Thank you so much for having me here. 

I am David Barrett, the founder and CEO of Expensify. We do 

expense reports that do not suck. It is a bold division, but we are 

improving the world one expense report at a time. 

So what I am going to talk about here is probably highly overlapping, so I am going to be more anecdotal here about the rise of the 

app stores. And I would say in my mind, the app economy started 

with actually a little known phone called the Danger Hiptop. I 

think I was only person who liked this phone. It was the first 

phone to actually have its own integrated app store, meaning that 

you could actually download and expand the functionality of the 

phone itself. This phone launched in 2002, but the app economy did 

not really typically take off until about 2008 with the iPhone App 

Store. And at six years, nothing happened. And I think the important reason why nothing happened is because the Hiptop was not 

backed by Apple, and thus, did not have the power to convince 

AT&T to allow applications to be installed on their phones. And so 

for about six lost years, we had the potential for an app economy 

but it simply did not happen. And I think that really drives home 

the importance of having open access to the technology, the Internet, and the users, in order to actually enable the technology of an 

app store to work. 

Secondarily, I would say in addition to the app store, what 

makes this whole revolution possible is the sheer power of these 

phones. I am trying to think of ways to sort of summarize how 

powerful these phones are, so to give some examples, the first portable computer that I can think of would probably be the Apollo 

Command Module, 1969. It had about 64 kilobytes of memory, 43 

kilohertz of processing speed. To put it into comparison, a single 

iPhone can process about 16,000 times more data, about 33,000 

times more fast. So that is basically a single iPhone has more 

power than the entire Apollo mission combined. All of NASA at 

that time could be powered by a single iPhone easily. 

Maybe more recent is 1997. IBM had a computer called Deep 

Blue. It was the first computer to ever beat a world champion in 

chess. A single iPhone is about 10 times more powerful than that 

computer, and that was just 1997. Or maybe a more recent IBM 

computer is Watson. In 2011, it beat Jeopardy for the first time. 

And so it was hailed at the time as being the smartest AI ever created. It is about 2,500 iPhones, which means in about seven years, 

due to Moore’s Law, which means that basically computing power 

doubles every 18 months. In about three terms, every one of your 

constituents is going to have a phone in their pocket more powerful 

than today’s smartest AI. And so that is pretty astonishing I would 

say. It is not totally accurate to say that every smartphone is as 

powerful as a super computer, but it is pretty darn close. And any 

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policy you put in place today is probably going to be applied to 

super computers by the time it is actually out in the real world. 

And so how this sort of works as a real world example. 

Expensify, as I said, we work in the ever-so-exciting field of expense report management, and what we do is we have an app 

where you take a picture of the receipt and a technology called 

Smart Scan will read the information off that receipt automatically 

without any typing involved, put it on the right expense report, and 

submit it for you. And so I would say in our world, the availability 

of a telephone platform with an integrated smartcam can enable 

this sort of scanning technology to bring extreme productivity to 

small businesses that are doing mobile travel on the road. 

And so I would say the app evolution is not going to sort of appear like HAL 9,000. Artificial intelligence is not going to sort of 

appear in this personal form. It is first going to start off with applications highly optimized for certain problem demands, like 

Expensify. 

And so I think that an exciting thing about this, as we are getting these more powerful automation platforms, they are not going 

to appear typically like in the enterprise or in the factories and 

trickle down to the people. The exciting thing about this environment is because of the sheer affordability of this platform, it affects 

everyone all at once. The entire world is benefitting from these sort 

of small business applications, starting with the individuals and 

moving on up. And so this sort of bottom-up adoption of this technology I think is really a major change for how technology has historically been adopted. 

So I would say maybe a final point, I have heard real broadband 

mentioned. I think that an amazing component of the app technology is it enables rural areas to actually contribute to a global 

economy. I know that our Smart Scan Technology employs about 

150 contract workers throughout actually rural Michigan, where 

we have one of our offices. And so unlike a typical Silicon Valley 

business, which is just based around San Francisco, we actually 

employ a global workforce and bring jobs actually back from 

around the world to rural America. 

And so I think that the smartphone technology, sort of powered 

by this global Internet economy, is bringing rural economy into the 

global economy as well. And so I think there is a wide variety of 

things it can do. All sorts of information in my notes here. But 

most importantly, things are really great right now, and I would 

say the most important thing we should work on is let us not screw 

it up. Things are actually really awesome. We do not need a ton 

of help. I would say patent reform, innovation reform, even tax reform things could help, but by and large, the main thing is let us 

just keep the party going. So thank you so much. 

Chairwoman RADEWAGEN. And now Dr. Greene? 

STATEMENT OF PATRICIA G. GREENE 

Ms. GREENE. Thank you, Chairman Radewagen, Ranking Member Moulton, members of the Subcommittee. Thank you for the opportunity to testify. It really is an honor to be here today. 

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I am going to base my testimony largely on that as an entrepreneurship educator, but also as the owner of a small business, a 

store in Gettysburg, Pennsylvania. 

I am also very pleased with the topic of the hearing today. As 

much of the public discussion around entrepreneurship and technology is really driven on a very thin slice of actual businesses in 

the United States, those that use or sell technology, and I would 

like to focus today that we are also looking at the other side of the 

equation. How do small businesses use and benefit from technology? 

If we consider that fewer than 10 percent of all U.S. businesses 

have more than four employees, we are a country of microbusinesses. There are 25 million businesses that fit into this territory of how do we actually learn again and use about this. The fact 

that apps can be helpful I take as a given. The question is how? 

How do these small businesses get access to the apps? How do they 

learn about them? How do they integrate them into their actual operation so that they can be tools for productivity? 

For evidence, I am going to use a couple different things. One is 

a piece of research that was done last year by AT&T with the 

Small Business and Entrepreneurship Council, and finding that 94 

percent of the polled small businesses use smartphone technology, 

two-thirds of them are using mobile apps, and they do save up to 

150 hours each. However—and I think this is an important however—73 percent of them are using them for social media and marketing; only 18 percent of them are using them for point of sale, 

those types of activities; and only 18 percent of them are currently 

using apps to improve their operations. There is a huge opportunity 

to work with our small businesses. 

The rest of my evidence I am really going to draw from the Goldman Sachs 10,000 Small Businesses Program. This is a half billion 

dollar initiative to help small businesses. We currently operate in 

13 sites across the country in some of the territories, and we are 

working with businesses that do have at least four employees, so 

they are growth-oriented countries. The companies today reflect 

over $3 billion in revenues. 

The important part about that is the diversity of the businesses 

and the diversity of the people. So for the businesses, no single industry represents more than 10 percent of the businesses in the 

program, the professional services is 34 percent. Everybody else is 

under 10 percent. And the business owners are important, too, in 

thinking about who is actually using the technology tools. The median age in the 10,000 Small Businesses is 46 years old. The range 

goes from 22 to 75. And please remember that these are, by definition, growth-oriented businesses fairly split as to gender with 46 

percent of the businesses are owned by women and a very broad 

array of educational backgrounds ranging from some high school, 

possibly a GED, to multiple graduate degrees. So when we are 

thinking about who is using apps in growing their businesses, we 

are looking at all kinds of people in all kinds of businesses. 

Within the program, we teach about technology in three different 

ways. The first one really is it is embedded into the curriculum, so 

we actually do have teaching notes for our teams to use as to how 

do they expand and learn about technology. We work with peer 

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learning, so how do they actually learn from each other, which is 

a huge way to learn about apps, and we also have a tech clinic 

where we actually teach them not about the apps themselves but 

about how do I identify what technology is available, how do you 

evaluate it, how do you know what to pay for it, and most importantly, how do I bring it back into my company and teach others 

how to use it? 

The app technology piece is really probably the most critical 

question in the how to use it. So the pricing is rarely the big challenge. It really is about a fear of inappropriate adoption. If I bring 

it in, will it work? And what is the cost if it does not work for me 

to have to go back, as these businesses generally have a very slim 

margin for errors. 

The question of app is also related to how they train their employees, and within the 10,000 Small Businesses, we have got 86.4 

percent of the business owners report that they are providing onthe-job training, and again, these are very small companies with 

62.6 percent using some version of online learning. Again, another 

opportunity for apps in general. 

I would like to close with one short example actually from a 

woman in another Massachusetts, Victoria Amador, of Tremendous 

Maids, who basically learned about an app to organize communication across her company from another person in the program. She 

reports that using—in this case she is talking about Google Voice— 

saves her thousands of dollars. He recommended to her when they 

met during the online portion and therefore, she becomes an example of using technology to enable working with others to learn 

about technology. 

Thank you very much. 

Chairwoman RADEWAGEN. And now Ms. Gray. 

STATEMENT OF CASSIE GRAY 

Ms. GRAY. Good morning. My name is Cassie Gray, and I am 

the owner of Clementine, a handcrafted jewelry business. Thank 

you, Chairwoman Radewagen, and Ranking Member Moulton, for 

the opportunity to testify. 

My road to entrepreneurship was anything but fast or predictable. I moved to New York after graduating from college and joined 

the publishing industry, working my way up from assistant to senior copywriter. But I developed something like a restless hand syndrome. I just wanted to make something tangible, and I found my 

way to beading and jewelry making in my spare time. 

About 10 years ago, my personal life was influx and I left New 

York to move back to my hometown of Ashfield, Massachusetts. In 

this rural hill town, I had to cull together a living from whatever 

I could—freelance writing, waiting tables, and making my jewelry. 

I opened ShopClementine on Etsy.com in January 2006. When I got 

my first sale, I literally jumped for joy. For the first few years, revenue was quite modest but I had fallen in love. While I was still 

working other jobs, I devoted myself to learning all I could about 

jewelry. I took a series of intensive metalsmithing courses, which 

gave me the confidence to expand my line and focus on attracting 

new customers. 

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Through it all, Etsy has remained my main venue. The Etsy platform allows me to directly talk to my customers, making the shopping experience truly personal. Now, I work 50–60 hours a week 

on my business, and yearly business is more than $130,000. While 

my store is particular to my personal circumstances, my experience 

is similar to other Etsy sellers. Just today, Etsy released a new report about U.S. Etsy sellers, which reveals that they are business 

owners in their own right, and the income they earn on Etsy 

through the website and mobile apps, matters to their lives and the 

broader economy. Like me, most Etsy sellers are women, 86 percent. Many are parents with children at home. Just under a fifth 

are low income. And 39 percent live in rural areas. Nearly half of 

all sellers had never sold their goods until they joined Etsy, demonstrating that Etsy functions as an onramp to entrepreneurship. 

And while some might be inclined to write our community off as 

hobbyists, income from these creative businesses matters. For 30 

percent of Etsy sellers, their creative business is their sole occupation. For the rest, their creative business supplements other jobs, 

contributing an average of 15 percent to total household income 

overall. 

The Internet and mobile technologies have opened up incredible 

new opportunities to people like me. To operate my shop, I use the 

website and two mobile apps Etsy offers. As of December 31, 2014, 

Etsy’s mobile apps have been downloaded 21.8 million times. The 

Sell on Etsy app is indispensable in my day-to-day routine. When 

I am working at my jewelry bench, I check orders and communicate with customers via the app. If I go to make a hammered 

ring but I cannot remember what gauge the silver should be, I 

check the listing details via the app. If I get a message from Etsy 

alerting me that one of my items has been featured editorially, I 

can increase the quantity available so that item does not sell out. 

I also do most of my business’s social media interaction via apps— 

Instagram, Pinterest, Twitter. 

Mobile app technology enhances how entrepreneurial Etsy sellers, like me, reach customers and make a living. And it is only the 

beginning. Already more than half of Etsy’s traffic comes from mobile devices. The fact that I can use my phone at all to do these 

things is a bit of a miracle; however, we still have a long way to 

go to getting access to technology to those who need it. 

I live and work in Franklin County, which is the poorest county 

in Massachusetts. Most of Ashfield, where I live, is completely 

without cellphone reception. In my house, high on the hill, I get 

just one bar of 3G. There is no broadband or cable available, so I 

use a satellite to connect to the Internet. It is slow and it involves 

me having to go out in the middle of winter storms with a kayak 

paddle to whack the accumulated ice off the dish. 

This gap in accessibility harms entrepreneurship and business. 

Policymakers have an opportunity to support businesses like mine. 

In addition to expanding broadband to rural areas, lawmakers 

should focus on the needs of the self-employed and microbusinesses. Most Etsy sellers work alone and face very different 

challenges from even a 10 or five person business. They are part 

of a growing trend towards self-employment in the U.S., which offers both new opportunities and new challenges. 

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For example, new administrative burdens impact microbusinesses dramatically. The newly introduced Remote Transactions Parity Act would require all Etsy sellers, regardless of size, 

to collect and remit sales tax in every state. Proposals like this 

threaten to undermine businesses of one who simply do not have 

the time or resources to comply with such requirements. 

Overall, I believe the Internet and mobile apps are creating incredible new opportunities for entrepreneurs around the country. I 

urge Congress to enact policies that support independent, creative 

businesses, enabling the broader maker market to thrive. 

Thank you. 

Chairwoman RADEWAGEN. I want to thank the panel for your 

testimony. And now I will give myself five minutes to ask some 

questions. 

Mr. Reed, you note that there are three billion different apps on 

the Apple store site. This is tremendous growth in just seven years. 

Do you expect the industry to continue growing exponentially or do 

you believe it will taper off? 

Mr. REED. Oh, I am confident that it will continue to grow exponentially simply because look at the number of devices that people 

have. This last year, we reached a point where connected devices 

in the United States exceeds the population of the United States. 

One of the things to realize is that the next generation of cars will 

all be connected devices. You have heard of the whole connected 

car movement. Well, now, every single car is going to come with 

its own series of applications and its own connection. So there is 

no question that the explosion is going to happen. 

What I think is more exciting is, as much as I love cool games, 

and we have a ton of members making cool games, I think it is 

really the way that mobile devices are going to empower Ms. Gray 

and others are the place where that exponential growth is going to 

be the most significant. 

Chairwoman RADEWAGEN. You mentioned that some small 

businesses are using apps for inventory tracking instead of expensive software programs. How do these apps compare in terms of the 

quality, features, and ease of use as compared to a program used 

on a desktop? 

Mr. REED. Well, it is a great opportunity to sit here next to Mr. 

Barrett, who is, in fact, one of those generating an application, as 

he said, that completely alters the paradigm. That is what is so 

amazing. 

So as you know, before, you would sit down at your desktop computer. You would have your stack of expenses, and you would sit 

there typing away. Well, with a product like Expensify—I am going 

to be your salesman today—you literally take your phone, you click 

it, and it shows up. So the idea of how it changes—and I thought 

Dr. Green, her point was exactly right—the fact that that is only 

still at somewhere under 20 percent, that is this hockey stick 

growth that we are going to see, because an app like his does not 

just do better or cheaper than the desktop equivalent; it literally 

changes the paradigm by adding features, like the ability to take 

a photograph, the ability to combine it together, and then move it 

to a desktop product that allows you to file your taxes, that allows 

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tricts—but that is where you really see that hockey stick growth. 

It is right there. It is from products like his, and from what Dr. 

Greene talked about, and the way that Ms. Gray said that she 

would like to incorporate them in her practice. 

Chairwoman RADEWAGEN. Thank you, Mr. Reed. 

Dr. Greene, what do you consider to be the major hurdles to 

small businesses utilizing apps in a constructive manner to increase a small business’s efficiency? 

Ms. GREENE. I think there are two parts to that. The first is 

knowing what is out there. They do know about a lot of the social 

media, but especially in underserved areas, I am finding that they 

only know about a small slice of what is really possible. So just 

knowing what is actually possible. And then the second is being 

able to undertake what they do see as a risk of incorporating this 

because they are afraid of getting it wrong, they do not have a lot 

of resources available to correct mistakes, and they think they may 

be doing okay as they go and not necessarily seeing the opportunity 

of what they could really accomplish with using these new types 

of tools. 

Chairwoman RADEWAGEN. Mr. Barrett, could you please elaborate on the impact your business in particular has had on the state 

and local community at your location in Michigan? How did you 

choose this location? 

Mr. BARRETT. Sure. Well, actually, I just flew from there yesterday, and it is in rural Michigan, in the middle of nowhere, surrounded by trees and one ski hill. It happened randomly. We had 

a contractor that we hired remotely, and then we had a problem. 

And we were like, ‘‘Hey, we need the guy to do this.’’ And he was 

like, ‘‘I know a guy.’’ And then that became two people, then it became four, and now it is like basically hundreds. 

And so I would say we have brought millions of dollars of economic activity to this tiny town. We are working with the local government, with the mayor and the city developers there, and so I 

would say we view Ironwood, Michigan, as a true partner in the 

business, and a really critical sort of secret weapon that we employ 

to compete aggressively with our Silicon Valley peers, but also the 

enterprise incumbents. 

Chairwoman RADEWAGEN. Dr. Greene, in your testimony, you 

state that peer learning about technology tools for small businesses 

is critically important. What recommendations would you make to 

policymakers to encourage the use of these tools, specifically mobile 

technology, such as apps? 

Ms. GREENE. I think that is a difficult one from a policy perspective on how do you drive peer learning. The part I would probably go to comes back to my experience working with the SBDCs 

and the SBA, in making sure that there are arenas in those funded 

parts of the program where these kinds of programs can happen. 

Probably the most important part of that though is to make sure 

that anyone that teaches in any kind of program that is supported 

by the government actually does understand technology, is able to 

teach about technology, and age cannot be an excuse. These programs are really for everyone, so no matter the age of the instructor or the student, there has to be an openness there to try new 

things. 

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Chairwoman RADEWAGEN. Thank you. 

And now I yield to Ranking Member Moulton. 

Mr. MOULTON. Thank you, Chairman. 

Ms. Gray, what can Congress do to help promote the development of apps for small business? 

Ms. GRAY. Well, I would say the most important thing is to continue to keep it free and open, to not put any barriers. Your work 

on the net neutrality was really helpful. I think that in order to 

really tap into entrepreneurship and technology, we need to keep 

a level playing field for everyone involved so that no single party 

or entity has an advantage. 

Mr. MOULTON. Thank you very much. 

Mr. Reed, would you like to add some comments? 

Mr. REED. I think one of the things that I think she mentioned, 

that this committee of particular jurisdiction has some interesting 

efforts on a very good story about figuring out how do you get mobile apps to be built? When we had our fly-in, we had a person 

come who had tried to reach out for an SBA small business loan, 

and he went through a process where he went to, I think, 19 

banks. He is a great entrepreneur, incredibly successful. One of the 

banks said something I thought was amazing. Said, ‘‘You know 

what? You are a great guy. We know you will be successful. If you 

were coming here to build a gas station, I would write you a check. 

But because I do not know how within the confines of the SBA to 

properly fund your clearly, likely to be successful mobile application, I cannot give you the money.’’ 

And so while I completely agree with Ms. Gray that barriers to 

entry are a huge part of it, the government has the ability to write 

a check. And when it says I will write a check for a gas station but 

I will not write it for an app that will grow and employ 150 people, 

that is when I have a problem. 

Mr. MOULTON. Thank you very much. 

Mr. Barrett, I am a former Expensify user myself. I ran a small 

business before running for Congress. I appreciate it. You certainly 

made things a lot easier for us as we were trying to get our company off the ground. 

Mr. BARRETT. Happy to help. 

Mr. MOULTON. You mentioned immigration reform. I wonder if 

you could comment on that and what a difference it would make 

and why you feel it is important to the small business economy. 

Mr. BARRETT. Sure. I think there are sort of two aspects of immigration reform. One is that immigrants are historically much 

more likely to start businesses than nonimmigrants. I think 40 percent of the Fortune 500 has been founded by immigrants or children of immigrants. And so I think if we are trying to drive the 

growth in the small business economy, the number one thing we 

can do, Trump’s comments notwithstanding, is to encourage legal 

immigration, because legal immigrants are the best and the brightest. And so we want to encourage this. 

Secondarily, I would say the truly best and the brightest are 

H1B visa holders. These are basically the finest people that we can 

find around the world. If we are going to let anybody in, that would 

be the people that we should definitely emphasize. And I know that 

as a small business, we compete very aggressively with, again, our 

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peers and our incumbents. And the number one tool that we have 

in doing that is hiring. And so I think that hiring is, as I mentioned, rural Michigan for us is really key because we find the right 

people for the right position, but also, we search around the world 

for the best people. And so I think improving or raising the cap on 

H1Bs can help not just Silicon Valley, but I think many businesses, 

compete more aggressively. In addition to just increasing immigration overall, I think we will drive more small business growth. 

Mr. MOULTON. Great. Thank you. 

And Dr. Greene, would you be willing to add to that and offer 

your own perspective on the value of immigration reform, or whether it is valuable or not, frankly, to small businesses? 

Ms. GREENE. I think Mr. Barrett covered that quite well. There 

are two ways to look at that in entrepreneurship, too. There is a 

long history of certain immigrant groups also being very strong in 

creating businesses. Not all immigrant groups but certainly quite 

a few of them. So not only for the best and the brightest coming 

in, and I think there are a lot of best and brightest here, too, that 

they can all work together with, but also looking at who is going 

to start and grow the next round of businesses comes into play as 

well. 

The woman that I mentioned from Massachusetts as an example 

of using apps actually is an immigrant to the United States and 

has received several awards as an immigrant-owned business. 

Mr. MOULTON. Thank you very much. 

Thank you all very much for appearing before the Committee 

and for testifying. I certainly have learned a lot, and I yield the 

balance of my time. 

Chairwoman RADEWAGEN. I want to thank all of the witnesses 

for taking time away from their businesses and families to participate in today’s hearing. 

I now ask unanimous consent that members have five legislative 

days to submit statements and supporting materials for the record. 

Without objection, so ordered. 

This hearing is now adjourned. 

[Whereupon, at 10:43 a.m., the Subcommittee was adjourned.] 

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1http://www.census.gov/econ/smallbus.html. Accessed July 21, 2015. 

Testimony from Dr. Patricia G. Greene 

Paul T. Babson Chair in Entrepreneurial Leadership, Babson 

College 

Academic Director, Goldman Sachs 10,000 Small Businesses and 

10,000 Women 

Co-Owner: Artworks, Gettysburg, PA 

Investor and Advisor: Portfolia, San Jose, CA 

House Committee on Small Business 

Subcommittee on Health and Technology 

Modern Tools in a Modern World 

July 23, 2015 

Chairwoman Radewagen, Ranking Member Moulton, Members of 

the Subcommittee, thank you for the opportunity to testify before 

the Subcommittee on Health and Technology on the topic of Modern Tools in a Modern World, or more explicitly for today, how 

apps, which I interpret as mobile computing tools, ‘‘improve businesses’ day-to-day operations, make them more efficient, assist 

their marketing and outreach capabilities, and, ultimately, stimulate revenue and job growth’’. 

I’m going to base my testimony largely on my experience as an 

entrepreneurship educator with Babson College, as the academic 

director and lead designer of the Goldman Sachs 10,000 Small 

Businesses and now 10,000 Women programs, as a federal appointed member of the SBA Advisory Board for the SBDC programs, as co-owner of Artworks, a store in Gettysburg, PA, and 

most recently, as investor and advisor to Portfolia, an equity based 

crowdfunding platform focused on women-led businesses and 

women investors. 

I’m very pleased with the topic of this hearing today as much of 

the public discussion around entrepreneurship is very technology 

driven, but it’s often driven to a tiny slice of businesses, those that 

exist to advance the use and/or sell technology. It’s gratifying that 

today we are looking at the other side of the equation, how small 

businesses can use and benefit from technology. 

Our economy is one of small businesses, with less than ten percent of all U.S. businesses having more than four employees. This 

means there are more than 25 million very small businesses either 

creating jobs, or providing the owner a job, and approximately an 

additional two million with between 5 and 499 employees, all trying to find the best tools to survive and thrive.1

10,000 Small Businesses, or 10KSB, is a $500 million initiative 

to help small businesses in the United States by providing entreSBREP-219 with DISTILLER

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2http://www.goldmansachs.com/citizenship/10000-small-businesses/US/about-the-program/impact-of-10ksb/index.html. Accessed July 21, 2015. 

preneurs an integrated program of practical business and management education, business support services, and the opportunity to 

access capital. Babson College is the academic partner for the program and is responsible for the education and advising components, the training for all those who deliver the program, the measurement and evaluation system, and the national alumni program. 

To date the program has served nearly 5,000 small businesses who 

represent nearly 100,000 employees across the US and the UK, including 49 states, D.C, and Puerto Rico and collectively have over 

$3 billion in revenues. We deliver the program through twelve community college sites and one blended (on-line and face-to-face) 

model housed at Babson College. 

The 10,000 Small Businesses alumni provide a highly useful context for considering the questions of this subcommittee today, how 

do, or how can, apps help them run more efficiently. The entrance 

requirements are for the business to be at least two years old, have 

at least four employees, and have revenues of at least $150,000. 

The program alumni are a broad cross-section of U.S. small businesses, with one unifying criteria, they all explicitly want to grow 

their businesses. They are largely mature businesses. The typical 

business comes into the program with $692,000 in revenues, 11 

employees, and having been in business for 11 years. Professional, 

scientific and technical services is the only industrial category that 

includes more than ten percent of the businesses and all industrial 

categories are represented in one way or another. 

The owners themselves are also important to consider when 

thinking about the use of technology tools. The business owners are 

most often around 46 years old, with a range from 22 to 75. They 

are fairly evenly split as to gender, with 46% of the businesses 

owned by women. And they have a very broad range of educational 

backgrounds, ranging from some high school to multiple graduate 

degrees.2

Given my background, my focus is more on how small businesses 

actually learn about technology tools. Most entrepreneurial education programs focus on planning, and very few actually focus on 

how to operate the business. I do take 10,000 Small Businesses as 

an exception. The use of technology by the businesses is primarily 

addressed in three ways in this program. First, we train all instructors to have an area of their classroom dedicated to a technology flip chart. Each business owner is asked to list the tech 

tools they use in running their businesses, with an emphasis on 

apps. This approach is particularly used during the Operations and 

Processes module. 

Second, the program is built on peer learning and the business 

owners are organized into Growth Groups to work with each other. 

These sessions include both formal and informal exchanges of information about tools used. Notably, we avoid organizing any business 

owner group by industry to promote cross boundary learning about 

tools. 

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And third, we created a technology clinic for alumni of the program that is focused on learning how to identify what technology 

exists, how to decide what apps are relevant, how to price them, 

and very importantly, how to integrate them into the company, including training employees on their use. 

I’d like to briefly expand on each of these techniques. First, too 

often technology, particularly apps, is thought of in very small 

buckets, applied to only specific areas. So the push toward discussing apps in every module is designed to both encourage the use 

of apps where appropriate, but to also demonstrate to others the 

range of possibilities from note taking and collaboration to the 

more specific marketing or scheduling. This approach does mean 

that you need entrepreneurship and small business instructors who 

are actually current and adept in using these apps. Age is not an 

excuse for avoiding technology. 

Peer learning about these tools is important, while potentially 

limited as to scale, especially when conducted outside of any organized program such as 10KSB. The use of technology, particularly 

mobile technology such as apps, needs to be integrated into regular 

training about starting and growing businesses, and decidedly not 

segregated into separate courses or offered only to certain types of 

businesses. We do not serve our small business owners well if we 

‘‘protect them’’ from technology. By this I mean a practice I have 

seen in a number of other small business service programs of deciding beforehand who is likely to grow, who is amenable to the use 

of technology, and therefore who would benefit from more exposure 

to and instruction about technology tools. 

The technology clinic proved to be a learning experience that we 

are now scaling across the country. For the pilot we included 

speakers from Square, largely focused on facilitating point of sale 

operations, Dropbox, for file sharing and storage, and Alignable, a 

social media collaboration tool. The intent was to demonstrate the 

range of tools available to the small business owners, while delving 

more deeply into the general technology selection and usage questions. The questions raised most often by the business owners were 

those that moved beyond selection, to training, and particularly 

about how to learn to connect across apps for increased efficiency. 

While not called this by the business owners, the desire was for an 

integrated portfolio, without being tied to any particular product or 

brand. 

For apps, the actual price of the app is generally less of a concern 

due to most pricing structures. The cost comes in the time spent 

on adoption, including the learning necessary to make the usage 

decision, and then to roll it into the company. There is also the fear 

of inappropriate adoption, the situation when the app doesn’t perform as expected, or just isn’t a fit for the business. Changes in 

technology are difficult for any size company; however, smaller 

companies generally have less budgetary room to make mistakes. 

While adopting an app may seem like a small download decision, 

the potential impact of that decision on their company often drastically slows down making the actual decision. 

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3http://www.tremendousmaid.com/about/. Accessed July 21, 2015. 

The question of app adoption is also related to how small business owners train their employees, in this case, about the use of 

technology. This again is often something that could often be better 

addressed in small business start-up or growth programs. The need 

to do this is included in 10KSB and at 18 months after the program, 86.4% of the business owners report that they are providing 

on-the-job training, with 62.6 percent using some version of on-line 

learning, which actually then suggests employee training and developing as another app use for small businesses. 

Much of the question about the use of apps and small businesses 

therefore comes down to learning. Learning about what is available, what makes sense, and how it can be used to improve the efficiency and effectiveness of any business. Overall, apps can make 

business life easier, and make small businesses more competitive. 

To also be considered, time is the small business owners’ most precious resource and appropriate app selection and deployment takes 

time. 

I’d like to close with one general and one more specific example 

of learning and using apps in 10KSB: 

One of the most striking memories I have from my experience in this program comes from New Orleans where early one 

morning before class I noticed one of the more senior business 

owners in the class sitting down with the youngest member of 

the class in order to unpack his new iPad and learn from her 

about the apps and tools she was using to organize and operate 

her business. This actually is peer learning at its finest, recognizing that every business owner has both something to learn 

and to teach. 

More specific is the example of Victoria Amador, co-founder 

and CEO of Tremendous Maid, Boston, MA.3 Tremendous 

Maid provides residential and commercial cleaning in the 

greater Boston area. The business was awarded Small Business of the Year from the City of Boston—Main Street District 

for Hyde Jackson and recognized by Governor Deval Patrick 

during Immigrant Entrepreneurship Month in 2013. Tremendous Maids was also named the 2014 Neighborhood Business 

of the Year by the Immigrant Learning Center Organization. 

Ms Amador uses technology tools ranging from basic CRM to 

sophisticated scheduling programs and free tools such as 

Google Voice. She explains that she sees these tools as a better 

way to serve her clients and communicate much more effectively with her team. She reports that the ability to maintain 

clear communication is paramount to her industry in order to 

serve high end clients. She credits Google Voice with saving 

her thousands of dollars. She learned about Google Voice from 

a discussion with another 10KSB business owner. He recommended it to her when they met during the on-line portion 

of the national blended cohort. Ms Amador’s example therefore 

becomes one of using technology to enable working with others 

to learn about technology. 

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Thank you again for the opportunity to testify before you today. 

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U.S. House of Representatives Committee on Small Business 

Subcommittee on Health and Technology 

Testimony on ‘‘Modern Tools in a Modern World: How App 

Technology is Benefitting Small Businesses’’ 

Presented by: 

Cassie Gray, Founder, Clementine 

July 24, 2015 

Good morning, my name is Cassie Gray and I’m the owner of 

Clementine, a handcrafted jewelry business. I’m so honored to have 

been invited to speak with you today. Thank yo Chairwoman 

Radewagen and Ranking Member Moulton for the opportunity to 

testify. 

My road to entrepreneurship was anything but fast or predictable. I graduated from Haverford College with a BA in English in 

1997 and promptly moved to New York and joined the publishing 

industry, where I worked my way up from assistant to senior copywriter. But I developed something like restless hand syndrome; I 

just wanted to make something tangible. I started sewing again, 

then rediscovered beading and jewelry making—all things I hadn’t 

done since I was a child. 

About ten years ago, my personal life was in flux, and I left New 

York to move back to my hometown of Ashfield, Massachusetts. In 

this rural hilltown, I had to cobble together a living from whatever 

I could: freelance writing, waiting tables, and selling my jewelry. 

I opened ShopClementine on Etsy.com in January 2006. When I got 

my first sale I literally jumped for joy. For the first few years revenue was quite modest, but I’d fallen in love. I spent hours each 

day in the Etsy community forums, chatting with other makers 

from across the country and the globe. 

While I was still waitressing and freelancing to get by, I devoted 

myself to learning all I could about jewelry. I attempted to teach 

myself to solder, but soon realized that a propane camping canister 

and tin plumbing solder probably weren’t going to give me the results I was looking for. I took a series of intensive metalsmithing 

courses at several different craft schools, which gave me the confidence to move in new directions, expand my product line and 

focus on attracting new customers who were willing to spend more 

for high quality handmade jewelry. Through it all, Etsy has remained my main retail venue. The Etsy platform allows me to talk 

directly to my customers, making the shopping experience truly 

personal. Now, I work 50–60 hours a week on my business, and 

yearly revenue is more than $130k. 

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1www.etsy.me/sellercensus 

While my story is particular to my personal circumstances, much 

of my experience aligns with that of other Etsy sellers. Just today, 

Etsy released a new report on the US Etsy seller community, 

which reveals that Etsy sellers are business owners in their own 

right, and the income they earn on Etsy—through the website and 

mobile apps—matters to their lives and to the broader economy.1

Like me, most Etsy sellers are women—86% in fact. Many are 

parents with children at home and just under a fifth are low-income, with annual household income under $25,000. 39% of Etsy 

sellers live in rural areas, compared to 21% of the general US population. Nearly half of all sellers had never sold their goods until 

they sold them on Etsy. In this way, Etsy functions as an on-ramp 

to entrepreneurship, creating opportunities for many people who 

might not otherwise have started a business and removing traditional barriers. 

And while some might be inclined to write our community off as 

hobbyists, income from these creative businesses matters. For 30% 

of Etsy sellers, their creative business is their sole occupation. For 

the rest, their creative business supplements other jobs, contributing an average of 15% to total household income overall. This 

money makes a difference—44% use it for necessary household expenses. 

Etsy sellers are also self-reliant. Like me, most Etsy sellers manage every part of their business themselves. The vast majority of 

sellers work alone from home, and most are self-taught. Of the 65% 

who required capital to start their businesses, 83% relied on their 

own personal savings, and only 1% obtained a loan. 

The Internet and mobile technologies have opened up incredible 

new opportunities to people like me. To operate my Etsy shop, I 

use the website and the two mobile apps Etsy offers, including one 

designed specifically to help sellers manage their shops, called Sell 

on Etsy. As of December 31, 2014, Etsy’s mobile apps have been 

downloaded 21.8 million times. 

The Sell on Etsy app is indispensable in my day-to-day routine. 

When I’m working at my jewelry bench, I check orders and communicate with customers via the app on my phone. If I go to make 

a hammered ring, but can’t remember what gauge the silver should 

be, I check the listing details via the app. If I get a message from 

Etsy alerting me that one of my items has been featured editorially, I can go to the app and increase the quantity available so 

that item doesn’t sell out. I also do most of my business’s social 

media interaction via apps: Instagram, Pinterest, Twitter, and 

Facebook. There are apps that let you enhance photos with text to 

easily create promotions, apps that let you tie all your social media 

outlets together so posting to one automatically populates the others. If I see that I’m running low on 14k gold wire, I can check the 

metals market app for the spot price of gold and decide whether 

to place an order today or wait for the price to come down. Mobile 

app technology enhances how entrepreneurial Etsy sellers like me 

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reach customers and make a living. And, it is only the beginning. 

Already, more than half of Etsy’s traffic comes from mobile devices. 

The fact that I can use my phone at all to do these things is a 

bit of a miracle. However, we still have a long way to go getting 

access to technology for those who need it. I live and work in 

Franklin County, which is the poorest county in Massachusetts. 

Most of Ashfield is completely without cell phone reception; in my 

house high on a hill, I get just one bar of 3G. 

There is no broadband or cable available, so I use a satellite to 

connect to the internet; it’s slow and involves me having to go out 

in the middle of winter storms with a kayak paddle to whack the 

accumulated ice off the dish. Technology is sprinting ahead, but 

there are rural areas that are at a disadvantage. This gap in accessibility is a huge hindrance to entrepreneurship and business. 

Policymakers have an opportunity to support Internet-enabled 

businesses like mine with hearings like the one today focusing on 

the benefits of the mobile app economy. There are other needs as 

well. In addition to fostering greater broadband deployment in 

rural areas, policy makers should adopt policies that specifically 

target the self-employed and micro-businesses. Most Etsy sellers 

are businesses of one, and face very different challenges from even 

a five- or ten-person enterprise. They are part of growing trends towards self-employment in the US, which offer both new opportunities and new challenges. 

For example, members of our community often struggle to learn 

about and comply with the regulations that govern their businesses 

and products. Regulatory agencies should establish a Micro-Advocate to conduct direct outreach to micro-businesses, create userfriendly educational tools, and make formal recommendations to 

ease compliance burdens. 

Further, policymakers should not increase the administrative 

burdens our community faces. For example, the newly introduced 

Remote Transactions Parity Act would require all Etsy sellers, regardless of size, to collect and remit sales tax in every state. Proposals like this threaten to undermine businesses of one, who simply don’t have the time or resources to comply with such requirements. 

Finally, many Internet-enabled businesses sell their goods worldwide, yet trade laws have not kept up with the advent of global ecommerce, and most independent, creative businesses lack the infrastructure and information to navigate complicated international 

trade rules. Customs and duties vary by country, and packages are 

often delayed at the border or subject to unforeseen import taxes, 

leading buyers to reverse transactions or demand refunds. De minimis customs exemptions offer a great opportunity to reduce these 

barriers. We appreciate efforts by this Congress to increase the 

U.S. de minimis to $800, and are hopeful that Congress can continue to pressure the administration to prioritize this issue in ongoing trade negotiations. 

Overall, I believe the Internet and the mobile app economy are 

creating incredible new opportunities for entrepreneurs around the 

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48 

country. I urge Congress to enact policies that support our efforts 

to start and grow our creative businesses, enabling the broader 

maker-economy to thrive. 

Æ 

SBREP-219 with DISTILLER