First, in one of his articles he says 43 states already have such laws, and you need to be licensed with them to do business nationwide.
So, why is one more state (California) adding licensing a big deal?
Second, when I Google for more information I come across almost no one complaining about this bill other than this one guy. If the bill is anywhere near as bad as he claims it is, I'd expect to see a lot of discussion.
The last attempt to discuss it here on HN was quickly flagged and killed.
Problem 1: California has a tangible net worth requirement and surety bond requirements. Most states have the latter, but not the former. Some states have asset requirements, but that means counting assets on the balance sheet, not shareholder equity. California counts shareholder equity, so essentially you have to have $500,000 in cash in the bank that isn't from a loan.
Problem 2: It's not really $500,000. The DFI uses its own non-published standards which are much higher. This makes it impossible to know how much you really need to raise.
Problem 3: Silicon Valley is in California.
Most of the people who should be complaining about this bill either don't know enough about the law to know what to do, or they're just too small to know that the law even exists. That's precisely the problem, though: sometimes great innovations happen where you least expect them, and by regulating small companies out of existence, they're not very likely to ever come up with anything.
Also, VC-backed payments companies that have recently disappeared (Bling Nation, for example) have no incentive to explain the true reasons behind their disappearing.
First, in one of his articles he says 43 states already have such laws, and you need to be licensed with them to do business nationwide.
So, why is one more state (California) adding licensing a big deal?
Second, when I Google for more information I come across almost no one complaining about this bill other than this one guy. If the bill is anywhere near as bad as he claims it is, I'd expect to see a lot of discussion.
The last attempt to discuss it here on HN was quickly flagged and killed.