Network School founder: Malaysia immigration probe threatens its tech ambitions
Balaji Srinivasan pauses US$500m after Malaysian operation at his Forest City commune
July 17, 2026 – 8:05 am
Balaji Srinivasan built Network School as a working prototype of the "network state," his theory that an internet country of engineers and founders can eventually do the work of a real one. This week, a real one reminded him who still holds the passports.
The former Coinbase CTO and Andreessen Horowitz partner stated on July 15th that a Malaysian immigration operation at his co-living commune in Forest City, Johor, put the country’s ambitions to court mobile tech workers at risk.
He suspended US$500 million (RM500 million) in planned investment until residents were assured they wouldn’t be treated as illegal immigrants, on top of the more than US$100 million he’d already committed.
The operation itself was brief. On July 14th, officers inspected 266 foreigners from 40 countries at the site, according to figures released by Immigration Director-General Zakaria Shaaban. Of those, 256 held social visit passes and 10 held professional visit passes under Malaysia’s digital nomad scheme, DE Rantau. Shaaban confirmed every travel document checked out, dispelling claims of Israeli nationals entering on second-country passports—a diplomatic dispute.
The heart of EU tech
Get the latest from Europe’s tech scene, insights from our founder Boris, and some questionable AI art. It’s free, weekly, in your inbox. Sign up now!
That claim, circulated online and amplified by pro-Palestinian groups, sparked the immigration inquiry. Malaysia does not recognize Israeli travel documents, making the allegation more diplomatic than bureaucratic.
Network School, launched in 2024, offers three-month residencies from US$1,500 a month, meals, and gym access, accepting cryptocurrency payments. It embodies Srinivasan’s network-state concept: a few hundred residents in an unfinished, Chinese-built city once planned for hundreds of thousands.
Malaysia has courted the tech industry while also policing it over the past year, from data center incentives to an AI chip seizure at its main airport. The Forest City experiment sits uneasily across that line, a foreign-run enclave both invited and inspected by the state.
DE Rantau, the professional pass held by 10 residents, is part of that pitch—a nomad visa designed to attract remote workers to just this kind of address.