Malaysia shutters under-fire digital nomad campus

By the Editorial Team · Wednesday, July 22, 2026

Malaysian authorities have shut down the Network School startup campus founded by Balaji Srinivasan due to regulatory violations and an ongoing immigration probe. The closure underscores the complexities foreign tech ventures face in Malaysia's strict legal environment, particularly concerning national security and diplomatic sensitivities.

Malaysian authorities have ordered the closure of a startup campus founded by American investor Balaji Srinivasan, citing regulatory breaches amid an ongoing immigration investigation. The Network School campus, located in Johor state near the border with Singapore, hosted hundreds of digital nomads working in tech and entrepreneurship.

The Iskandar Puteri City Council revoked the business license for one Network School site and found another operating without a license and engaging in activities beyond those permitted under its office-use permit. Johor Chief Minister Onn Hafiz Ghazi emphasized that action was necessary when non-compliance with regulations is identified, stating that no entity is above the country's laws.

The closure follows a raid last week initiated after unverified online allegations claimed the campus was hosting foreigners illegally, specifically pointing to Israelis with dual citizenship. Malaysia does not have diplomatic relations with Israel and prohibits entry to Israeli passport holders, but there are no specific laws addressing holders of dual citizenship.

Srinivasan, a former senior executive at Coinbase, stated that Malaysian authorities reviewed hundreds of passports at the nearly $25 million residential development, which serves startup founders, software engineers, investors, and digital entrepreneurs. According to Srinivasan, officials confirmed that all travel documents were in order. Following the raid, he announced a freeze on all investment projects in Malaysia until there was sufficient assurance that similar issues would not arise again.

Onn Hafiz conveyed that while Johor welcomes high-quality investment, the sovereignty of Malaysian law takes precedence over any business interests. The Network School has not issued public comments since the license revocation and closure order.

The incident highlights the challenges faced by foreign tech ventures operating within Malaysia's regulatory and immigration frameworks, especially amid sensitive geopolitical considerations relating to national security and diplomatic relations.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.