As an immigration lawyer in Silicon Valley, I work with clients in cutting-edge industries from artificial intelligence to climate technology. They routinely seek investors who are willing to finance their early-stage companies to the tune of $5 million to $40 million.
For most, securing that eye-popping amount of funding is the easy part. Much harder is getting the visa or green card to put down permanent roots here. How can you focus on launching a business when you don’t know if you’ll be allowed to remain in the country?
The avenues for international entrepreneurs are less than ideal. Right now, that’s harming America’s ability to be competitive with up-and-coming powers like China.
Some countries have a special treaty with the United States. If you’re from one of them and have at least about $100,000 to invest, you can start a U.S.-based company. But here’s the catch — you’re only allowed to stay two years at a time.
After that, the options aren’t great. You can leave and try to return, attempt to renew, close up shop, or leave the country and try to run your company from abroad. There’s no direct path to a green card. If you raise a significant amount of venture capital, then your own equity is diminished, which in turn can affect your eligibility for a visa! It makes no sense to the world’s best and brightest.
Another option is the troubled EB-5 program. This is for international entrepreneurs who have committed to investing $500,000 to a $1 million and creating at least 10 jobs for Americans. Many years later, that can lead to a green card, but the business model requirements are antiquated. Even the most brilliant startup founders wouldn’t guarantee a staff of 10 as soon as they land on the ground.
Investors want to see results within 18 months of funding; they can’t wait years for founders to get green cards. There are other hurdles too. It’s no wonder I see so many would-be founders taking their innovations and their capital to countries with more welcoming immigration policies.
That’s why the new Bipartisan Innovation Act is so important. It includes the Startup Visa concept from the Let Immigrants Kickstart Employment (LIKE) Act — which I personally helped draft — where immigrant entrepreneurs and immigrants with PhDs in science, technology, engineering and math (STEM) would have immigration pathways that could potentially enable the creation of approximately 1 million to 3 million jobs in the next ten years.
The government has taken small steps forward toward improving the situation, but our nation needs more if we’re going to stay competitive in fields like biotechnologies, hypersonics, quantum information technologies, nanomanufacturing and supercomputing. Without being able to stay out front, the United States doesn’t stand a chance when it comes to national security and critical technologies.
In January, the Department of Homeland Security increased the categories of STEM grads who can work here temporarily after graduation. They’ve also made it easier for companies to bring in temporary STEM researchers from abroad and to let high-skilled workers start a company here if the venture is “in the national interest.”
Yet most of these developments don’t increase the speed with which founders can start companies, or lead to permanent resident status; they are only available to a very select group of people.
Many high-skilled immigrants currently in the United States would make entrepreneurial contributions if their visas allowed it. But they don’t. If you’re here on a high-skilled visa and waiting in line for a green card, you can’t leave your job to start a company. And if you do manage to launch something on the side, you cannot earn income from it.
Think about the talented graduates of our first-rate universities who might like to one day use their American training and connections to found a business. Why would they study here knowing that option is likely unavailable to them?
We need Congress to pass the Bipartisan Innovation Act. The Startup Visa is essential, allowing ambitious changemakers to develop and launch with real security — without a ton of red tape. It’s been consistently challenging and frustrating for my clients who want to be in the United States but get no answer from the government. And all the while, the clock is ticking for their companies and their investors.
I’ve considered suing the federal government about delays in the Obama-era International Entrepreneur Parole process. But most founders hoping to move here and start a business, don’t want to start by suing the government of the country they’re hoping to join.
The changes that the Bipartisan Innovation Act could bring about would have real and lasting benefits. When an immigrant entrepreneur starts a business, they eventually need to hire salespeople, accountants, engineers, marketers, and a whole slew of other positions that Americans will fill. Paving the way for the creation of new businesses — and therefore new jobs — is always a good thing.
And immigrant entrepreneurs have an excellent track record. In 2017, immigrant-owned businesses employed 8 million people and did $1.3 trillion in sales. Nearly half of all Fortune 500 companies were started by an immigrant founder, according to the American Immigration Council, and more than half of America’s billion-dollar startups were founded by immigrants. That’s huge!
Talented, driven immigrants once flocked to the United States, but our draconian immigration policies are making them think twice. Many of these entrepreneurs are now moving to Canada, Australia, and Europe, where they have specific programs and even tax breaks for startup founders.
I have to be real with my immigration clients: while the United States holds unmatched potential for success, the hurdles and roadblocks created by our outdated immigration system can make it nearly impossible to launch here. Entrepreneurs are risk-takers by nature, but the risks need to make sense.
Sophie Alcorn is the founder of Alcorn Immigration Law in Silicon Valley, host of the podcast Immigration Law for Tech Startups and author of the TechCrunch weekly immigration advice column “Dear Sophie.”