Thursday, December 23, 2010
The Startup Visa Act of 2010: Bolstering Innovation and Technology for America's Future
Over the past year, venture capital and technology companies have rallied around legislation aimed at making visas more available for entrepreneurial foreign investors. Senators Kerry and Lugar originally introduced the Startup Visa Act on February 24, 2010 in response to suggestions from venture capital companies. The Startup Visa Act of 2010 aims to reform the EB-5 Visa which currently governs the availability of visas to foreign investors.
The proposed legislation would provide a visa for a foreign investor who seeks to start a company and secures at least $250,000 from venture capitalist or angel investors. Permanent residency would be available to those immigrant investors who, after two years, created at least five U.S. jobs and raised an additional one million dollars in capital or have revenues exceeding one million dollars. This legislation was introduced with the hopes of bolstering innovation that current U.S. immigration policy does not allow for. The new legislation is supported by fears that the U.S. is losing ground to other nations in terms of innovation, technology, and high-tech jobs.
The innovation of immigrant entrepreneurs can be in seen in tech and pharmaceutical companies such as Google, Pfizer, Yahoo, and eBay. From 1995-2005 immigrants founded over 25% of start-up technology companies and have since provided 450,000 jobs and 52 billion dollars in sales (http://startupvisa.com). Immigrants make up nearly half of the science and technology PhDs and nearly a quarter of the science and tech workforce. Yet with restrictive immigration work policies, the education and innovations of immigrants is being lost to other nations.
The Start-up Visa Act of 2010 provides an important basis for increasing innovation and technology in the U.S. by allowing brilliant minds from around the world to set-up shop in the U.S. Some critics claim that this act will enable the U.S. to steal talent from other nations. While the criticism is founded in truth, many foreigners educate themselves at U.S. institutions and are forced to return to their original homes because they cannot obtain visas in the U.S. The education immigrants received in the U.S. helps their country and act supporters believe the knowledge is better served in U.S. industries. The Startup Visa Act is an excellent way to entice U.S. educated immigrants to remain in the U.S. and put their U.S. educations to use. Enticing talented technologically advanced minds to remain or come to the U.S. will enable the U.S. to remain a leader in innovation.
Critics also fear the act will create corruption in the immigration process and will create too much competition for American companies. As to the first assertion of corruption in immigration, this type of work is already available under EB-5 and the Startup Visa Act would merely increase access to these types of work visas. Additionally, it would not be right to punish everyone at the expense of the few that may try to abuse the system.
Further, the claim that making it easier for foreign investors to start companies in the U.S. would create too much competition is largely unfounded since the number of domestic start-up companies has been on the decline in the states and on the rise abroad. The Startup Visa Act could help reverse the downward trend of start-ups, tech, and science related jobs by pumping technology and innovation into our economy while creating jobs for U.S. citizens to fill. It is a smart step forward to keeping the U.S. ahead in technology and innovation.
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