A "grassroots" activist group of small business owners was bankrolled by Google and Amazon to lobby against Big Tech oversight.

• The Connected Commerce Council, claiming to be a grassroots movement for small business owners, is actually a well-funded advocacy group backed by tech giants Google and Amazon.
• According to CNBC, Chris Grimm, a spokesman for the two tech companies, confirmed that they are currently the council's only source of financial support.
• The Campaign for Accountability labeled 3C as an "Astroturf" lobbying group due to the financial backing of tech giants.

Arrow M Enterprises," a small blacksmith shop owned by Clay Montgomery, is located outside of Mingus, Texas. The shop specializes in hand-forged metal works and grilling tools. In addition to these products, Clay sells a spicy barbeque sauce and a meat rub called "Bite My Butt.

The Connected Commerce Council, a Washington, D.C.-based trade group, has listed Montgomery's blacksmith shop as a member. The council aims to promote small businesses' access to digital technologies and tools through its non-profit membership organization.

The group advocating for less aggressive regulation of big tech companies also aims to educate policymakers about the crucial relationship between technology and small businesses, as stated on their website.

Montgomery claims he is not a member of the Connected Commerce Council and has never heard of it. The blacksmith stated to CNBC that he would never join a tech lobbying group in Washington because he is not skilled in technology.

Over 20 small business owners, including Montgomery, have expressed confusion about being listed as members of the Connected Commerce Council (3C) despite never having heard of the organization or knowing why they were included.

The council, which presents itself as a grassroots movement for small business owners, is actually a well-funded advocacy group backed by tech giants. The two tech companies are listed as "partners" on the organization's website and currently provide the council's sole financial support, as confirmed by 3C spokesman Chris Grimm to CNBC.

‘Astroturf’

The Campaign for Accountability labeled 3C as an "Astroturf" lobbying organization due to the financial support of tech giants. This Washington term refers to a group that pretends to represent grassroots entities but actually advocates for big industry. The Campaign for Accountability described 3C in a 2019 report as a "front group for the nation's largest technology companies."

The Campaign for Accountability's executive director, Michelle Kuppersmith, stated that Big Tech is aware that voters and their representatives are not very supportive of the complaints of large corporations with trillion-dollar valuations. As a result, they have chosen to portray small businesses as the true victims of antitrust legislation.

Some active small business members in the group value 3C's offerings and agree with its issue advocacy in Washington.

Michelle Thom, owner of "A Wild Hair by Michelle" salon in St. Clair, Minnesota, is more sympathetic towards small business owners than wealthy technology executives. Despite being listed as a member on the Connected Commerce Council's website, Thom claims she never heard of the group and her business should not be associated with them.

Despite declining to give his name, the owner of Bud's Barbershop in Wylie, Texas, was listed as a member of the group, even though he stated that he has never heard of it.

Christine Little, owner of 1058 Auto and Towing in Swansea, South Carolina, stated that she was unaware of the council to which her company belonged. "I'm pretty sure I'd remember joining the group," she said to CNBC. "We just tow."

Partners

The council's website previously listed its "partners," including logos of tech giants such as Google, Amazon, and Square (now known as Block). However, small firms have expressed uncertainty about their inclusion on the 3C website.

Despite being listed on the Connected Commerce Council's (3C) website, Jack Dorsey's Block stated to CNBC that it is not a partner of the council. Following CNBC's contact, 3C removed Square's logo from its website on Monday, as per Block's request.

Grimm removed Square's logo on Monday after CNBC's inquiry because Square is no longer an active partner of the Connected Commerce Council.

According to Rob Retzlaff, Executive Director of the Connected Commerce Council, all members of the group have affirmatively signed up, whether through events, online, or personal connections, and thousands have responded to surveys, attended meetings and events, and communicated with legislators.

Retzlaff stated, "I sincerely hope that you do not misrepresent our efforts or the views of small businesses as an astroturf organization that manipulates people's words, or use outdated membership information to divert readers' attention from legitimate small business concerns and their interactions with policymakers."

In February, the group silently removed a list of thousands of grassroots members from its website because it fell behind in updating its member list. Grimm, the council's spokesman, stated that the group has more than 16,000 current members but did not provide a current list of them.

Free membership

The Connected Commerce Council does not charge fees to its members or bill them for services, Grimm stated. The group's sources of revenue beyond donations from large technology companies are unclear. According to IRS documents, the group received more than $1.6 million in revenue in 2018. In that year, the group spent over $100,000 on a strategic communications firm in Washington.

Google and Amazon are members of the Connected Commerce Council, but they did not disclose the amount of their donations.

In 2020, Facebook was listed as a partner of 3C, as reported by The Washington Post. However, the company has since discontinued its involvement, according to a source who requested anonymity to speak more freely. Facebook's parent company declined to comment or answer questions about how much money the company had previously given to 3C.

The Connected Commerce Council has been advocating for small business and technology issues on Capitol Hill for several years, working with an outside lobbying firm called the Majority Group. In 2021, the group spent $400,000 on lobbying, according to the Center for Responsive Politics. In 2018, the Connected Commerce Council offered public comment to the Federal Trade Commission on antitrust issues, arguing that large technology platforms such as Amazon provide benefits to small businesses.

Google spokesman Jose Castaneda issued a statement regarding the company's involvement in 3C. He stated that many small businesses are worried that Congress's controversial bills could harm the digital tools they have used to adapt, recover, and reach new customers during the pandemic. He urged concerned businesses and their representatives to urge Congress to consider the unintended consequences of these bills on small businesses across the country.

The Connected Commerce Council, with only 304 followers on Facebook, has been an active advertiser on the platform since its creation in 2018. Over the years, it has spent more than $600,000 on advertising, including $9,000 in the last week, as revealed by its advertising library.

The Connected Commerce Council, backed by large tech companies, frequently supports the same positions as the tech giants, who have been advocating against antitrust bills on Capitol Hill that would impose rules on the tech firms or make it easier to break them up. One such bill aims to prevent companies like Amazon and Google from promoting their own products in online marketplaces at the expense of their competitors.

‘Amazon helps our members’

Avoid giving away America's technological advantage through Congress' actions. Write a letter," urged an ad from the Connected Commerce Council in March, which has been viewed over 125,000 times on Facebook. The ad also stated, "Dangerous legislation in Congress will harm America's economy and endanger small businesses.

In March, an ad was run that directly mentioned Amazon, which is one of the companies that funds the Connected Commerce Council. The ad stated that Amazon Marketplace was at risk and urged viewers to take a survey and stand up to Congress. Additionally, the advertisement asked small business sellers for their experience to help fight harmful legislation in Congress. The ad has been viewed more than 8,000 times on Facebook.

The council conducted an online survey on Facebook, which revealed that some elected officials believe Amazon is too large and dangerous because it helps members and small businesses sell more products and earn more money.

The council operates as a well-organized advocacy group. In 2019, 3C’s lobbyists had met with 50 members of Congress, filed seven official comments at regulatory agencies, and sent two representatives to testify before Congress, according to the Campaign for Accountability’s 2019 report. Additionally, the council published a series of materials that portrayed the tech giants in a positive light, including quotes from small business owners praising them, the report stated.

To succeed, the Connected Commerce Council must convince lawmakers that it genuinely represents the interests of the more than 10,000 small businesses it claims to support. However, upon closer examination, it becomes clear that this image of fervent antitrust opposition is driven by funding from Big Tech.

Great resource

The group highlighted several small business owners who are legitimate members. Mimi Striplin, a former 3C board member, founded the Tiny Tassel in Charleston, South Carolina, which specializes in selling jewelry and accessories.

The group is a valuable resource for small businesses seeking access to digital tools, according to her. Additionally, she stated that 3C keeps her informed about new legislation being passed, including antitrust laws that could potentially affect the affordability of the digital tools she relies on, such as social media and software for increasing her product's visibility on Google.

In 2020, Sheryl Sandberg, chief operating officer of Meta, selected Tiny Tassel's earrings as one of her personal picks for Facebook's #BuyBlack Friday gift guide, which encouraged users to support Black-owned businesses. Despite her membership in 3C, Striplin stated that the selection of her products by Sandberg was not connected to her affiliation with the organization.

Salil Gandhi, a current board member, runs a social media and digital marketing company called SBO Buzz in Chicago. He stated that the group was beneficial for small business leaders during the Covid pandemic, including hosting a weekly Zoom happy hour for 15 to 30 small business owners to connect with one another.

Gandhi stated, "We would gather, enjoy a cocktail, and discuss the challenges we faced as small business owners, including PPP issues." He added, "I remain close friends with many of the individuals I met through that platform."

Gandhi stated that he is not opposed to the small business advocacy group being primarily funded by big tech companies because small businesses already rely on these companies for free tools to manage their operations, such as Gmail accounts. He added, "When I consider issues, I do so from my own perspective. Nobody has ever instructed me on what to say or what's happening."

ASM Games founder Alfred Mai, who established the company with his wife in 2017, stated that he relies on Amazon to sell his products and supports the group's efforts to oppose antitrust measures in Washington. The company offers card games for social events, including "These Cards will Get You Drunk" and "Do You Really Know Your Family?" Mai emphasized that Amazon has been critical to the success of his business.

These antitrust bills, commonly referred to as 'break up Big Tech,' can have a significant impact on my business, as Mai stated. However, it's important to note that this issue extends beyond just Big Tech and also affects small businesses.

He expressed concern about the unintended consequences of congressional action that could lead to Amazon shutting down its third-party marketplace site, where he sells his card games.

"I am not being influenced by an Amazon lobbyist's beliefs," Mai stated confidently.

— CNBC’s Bria Cousins and Paige Tortorelli contributed to this report.