Trump administration has plan to scrap ‘startup visa’ rule

From the article:<p>&quot;To qualify for the rule, entrepreneurs would have to meet high standards. A foreigner must demonstrate that he or she will contribute to economic growth or job creation and show that a reputable investor has put at least $250,000 into the company. Under this rule, they can stay in the U.S. for 30 months, with the possibility of a 30-month extension. They cannot apply for a green card during this period.&quot;<p>This sounds like a pretty lame visa. How are you supposed to build a startup if you only have 30 months to do so? Why would investors risk $250k if the founder may be deported in 30 months? What happens after the extension period?<p>I&#x27;m 100% in favor of increasing all immigration to the USA, but this visa doesn&#x27;t sound like a good option at all. Is the USA really so appealing that talented entrepreneurs will jump through this many hoops to start their company here?

I was invited last year in a round table discussion on this new rule. The original responses for the rule were mixed as there are plenty of nuances. Specifically, the main concern is the rule would lead to investors demanding founders to first acquire this type of status before they were able to get funded, causing a Chicken and Egg problem.<p>The original proposal of the rule required 375k of funding from US only accredited investors, and there are also requirements for the startup founders to maintain a certain threshold of ownership while being able to hire a lot of American employees in short period of time. I don&#x27;t remember the specific number requirement&#x2F;head counts but it was definitely enough to pressurize the company to expand in size quickly, while many tech startups do not necessarily need to hire dozens of employees in a 1-3 year period, not to mention they all had to be US citizens. 1-3 years would also be a stretch for most startup to figure out a concrete plan of growth in order to quality for an extension. And what if the founders want to bootstrap themselves?<p>Ultimately this rule still doesn&#x27;t show any concrete pathway of residency or visa guarantees after 6 years. And because it is not a visa, it will take time to educate immigration officers and TSAs as well as creating a reasonable structure to allow founders to travel outside US legally as well. Historically there is a huge delay of understanding OPT, STEM and O1 visas in plenty of US embassies.<p>To make things even more complicated, it is not USCIS&#x27;s interest to be a judge to tell which company would qualify for this rule, and they would need to form a group of trusted committees to check case by case if a company and their founders&#x2F;co-founders qualify for this rule. I also heard that founder&#x27;s spouses would be able to travel to US too.

I asked this very question on HN in November 2016: will the &quot;startup visa&quot; survive? Commenters thought that Trump wouldn&#x27;t interfere with it:<p><a href="https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=12931943" rel="nofollow">https:&#x2F;&#x2F;news.ycombinator.com&#x2F;item?id=12931943</a><p>This is a solid reminder that the Trump administration is showing itself to be mostly concerned with undoing anything that Obama did, rather than working for anyone&#x27;s benefit. You can&#x27;t apply logic to predict the actions of these people.

Vancouver, anyone?<p>I live in Seattle and I&#x27;m about ready to drive two hours north for my next startup. To hire the Russian programmers I&#x27;m already working with, or the folks on Kaggle I&#x27;d love to hire. The US has a completely broken scheme for visas.

Unfortunately, the immigration policies of most countries in the world are one huge stupid joke. Why so much obsession about the country where people were born into? It wasn&#x27;t their choice at all. It just doesn&#x27;t matter.<p>The only questions you should be asking are &quot;are they decent people? Are they willing to integrate? Will they contribute to our economy? Will they make us problems?&quot; And none of these questions you can answer by reading the name of the country on their passport.

Are they going to scrap the EB-5 visa too? Doesn&#x27;t it basically sell citizenship for real estate?

This is a wild speculation, but is it possible that the Trump administration believes startups to be bad for the Rust Belt working class and other similar demographic they say they represent? For example, greater efficiency and automation could reduce employment of semi skilled people.<p>In the long run, this line of policies would of course lead to technological slow down and give a big opening for other countries to take the lead in a crucial determiner of economic successes.<p>Other possible theses may be that they favor the &#x27;native whites&#x27; to have control as Steve Bannon used to mention or try to undo the legacies of Obama.

Then lets be blatant and straightforward then.<p>&quot;If you&#x27;re rich and willing to spend, we want you. If you&#x27;re average or poor, fuck you.&quot;

Sorry for a stupid question but I have to ask. Why everyone is so desperate to start a company and locate it physically in the US? Is it just because of VC money? Wouldn&#x27;t any safe place with good laws and easy immigration policy do? I don&#x27;t take seriously Blockchain projects (and consider most of them blatant scam) and they are relatively small now. But longterm can this model solve the part about VC money?

A practical question:<p>How easy or challenging is it to stay in Toronto or Vancouver and run a US-registered startup there, if you need to collaborate with others in either SF Bay area or Boston&#x2F;NYC? (In-person meetings might not need to be frequent; geting together once a month could be sufficient.)<p>I am an entrepreneur from Asia working to build a fundamental technology and was planning to set up a company and live in the Bay area. After studying diligently about various options, Canada could in fact be a better place to settle in with a proper startup visa and much fewer hoops to jump through, however the attraction of US tech ecosystem is powerful.<p>(Note: I earned a Masters degree with a thesis on AI&#x2F;ML from a major US research university and have traveled to, attended conferences, and lived in the Bay area for several months per year over the last three years.)<p>The major reasons for SF Bay area dominance include:<p>1) access to top people, many if not most were&#x2F;are foreign students, who attend UC Berkeley and Stanford,<p>2) ecosystems of global tech talents recruited by major tech powerhouses like Google, Facebook, Apple, etc.,<p>3) deep expertise and risk-taking attitude of Bay area VCs and angel investors, and<p>4) ease of access to vast US consumer and enterprise markets.<p>For 3) would major VCs or angel investors invest in a startup with offices about 1.5 to 2.5 hours away by plane? (The founders would need to travel to see them sometimes; but do they require in-person supervision&#x2F;updates more than say once a month?)<p>For 4) I assume if the company is US-registered, it shouldn&#x27;t have a problem in principle, is that true?

I&#x27;m surprised no other country has decided to go ahead and create an equally as open and safe environment for entrepreneurs to start companies. My understanding (which, I&#x27;ll admit, is only based on my own observations) is that the vast majority of people outside the western sphere still regard the US through what&#x27;s projected in hollywood movies and aren&#x27;t really in touch with the reality of what life is in modern america (I&#x27;m a EU citizen myself but have quite a few US based&#x2F;American friends).<p>Essentially, the way I see it is : The US still has an edge in technology and are able to attract top talent from overseas because they still benefit from cultural hegemony and their image worldwide. What happens when the dream evaporates is still a mystery to me. For example, how will the situation evolve once chinese &#x2F; russian &#x2F; indian universities catch up with institutions like stanford &#x2F; MIT etc and enough investors from these countries decide to pour money into local startups ?

We should put boats off the coast of San Francisco like we talked about a few years ago.

&#x27;Startup visa&#x27; is one term for it, &#x27;buy-a-visa&#x27; is another.<p>I&#x27;m not sure that it&#x27;s necessarily a bad idea; someone with vision and money may be able to contribute a lot to the economy. But handing them a visa for cash and a couple of years of supplying jobs feels very transactional. It says, &quot;you can come here as long as you earn lots of money,&quot; not, &quot;you can come here as long as you contribute lots to the economy.&quot;

If US doesn&#x27;t want startup entrepreneurs there are plenty of other countries that have specialized visas to promote entrepreneurs and talent.<p>For example, UK has &quot;Tier 1 - Entrepreneur Visa&quot; where you can remain and run a company for 5 years. After 5 years, you can apply for extension for another 5 years or apply for settlement.<p>There is also UK &quot;Tier 1 - Exceptional Talent&quot; visa where you can apply to remain and work in UK without requiring any sponsorship from companies unlike H1B visa in US which requires company sponsorship.

I think this might actually be a chance for the european tech industry. More people will stay here (in europe) + come here to pursue a career in the tech industry. What is needed additionally is a network of investors and vc-people to realize great ideas.

Awesome! They are welcome in the EU, and where the talent is, the investors will follow.

Good idea. A lot of corrupt Indian politicians have been sending their progeny to USA with this visa. It has nothing to do with startups but it is putting up visa for sale.<p>There is nothing wrong in putting visa for sale, but please do not insult many of us who are giving prime of our careers to startups while jumping through complex maze of US visa system.

Shit, I am locking myself in my room to study to get a job in silicon valley, what now?

Why not Boise? We have population of refugees here looking for an opportunity.

Huh, that might be one of the few things I agree with Trump about.

Who is supposed to benefit from this? I&#x27;m confused.

A major reason for US prosperity and world-class science and technologies is the immigration of best minds from all over the world.<p>Within 12-20 years, China&#x27;s real GDP will overtake the US, assuming that China&#x27;s GDP grows at an annual rate 2.5+% faster than the US for the period. This is quite plausible given that the current per capita income of China is only 1&#x2F;7 of the US and its major focus on R&amp;D. Even now, many of the best Chinese graduates from US universities are returning to China to pursue better opportunities there.<p>China is spending $409 billion (PPP) on R&amp;D, the second highest in the world after the US and ahead of the EU. This amounts to 2.1% of GDP and very high for their stage of economic development [1]. Their goal, from a variety of sources, is to overtake the US as world&#x27;s no. 1 and reclaim their historical place.<p>If you look at PISA, China and the rest of East Asia, together with Singapore, consistently perform at or near the top in math and science, and quite well at reading. Even the best performing US state, Massachusetts, is significantly below those in Math and Science [2].<p>Relatedly, China is catching up to the US in AI. [3] Most groundbreaking research is still conducted in the Western hemisphere, but East Asia is getting there despite much later starts. Also, many top researchers in Western labs are from East Asia, who may later decide to move back once the circumstances change.<p>Given the above factors, and only one-fourth the population (330 vs 1390 million), if&#x2F;when the US cannot take advantage of best minds from these and other countries, would it be able to maintain the technological lead for long?<p>If the answer is no, how about the military and diplomatic dominance, which almost always follows economic and technological leads?<p>A possibility: If a larger portion of the GOP wakes up to the above, possibly within the next 10 years, they will start to actively recruit high-skilled immigrants, perhaps with some sort of point-based system as in Canada and Australia. Whether it would be too late or not remains to be seen.<p>[1] <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;List_of_countries_by_research_and_development_spending" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;List_of_countries_by_research_...</a><p>[2] <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Programme_for_International_Student_Assessment" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Programme_for_International_St...</a><p>[3] <a href="https:&#x2F;&#x2F;www.nytimes.com&#x2F;2017&#x2F;05&#x2F;27&#x2F;technology&#x2F;china-us-ai-artificial-intelligence.html" rel="nofollow">https:&#x2F;&#x2F;www.nytimes.com&#x2F;2017&#x2F;05&#x2F;27&#x2F;technology&#x2F;china-us-ai-ar...</a>

Here is the detailed comment by &quot;Immigration Voice&quot; on why the rule is bad for everyone except special interest:<p>&quot;...The new immigrant entrepreneur parole program will create a yet another class of immigrants, albeit minority partners and working resources in the start-up entity, who will be beholden and entirely dependent on the hand-picked venture capital firms to maintain their status in United States in the parole period and beyond as immigrant entrepreneur will have no clear pathway to permanent residency. The proposed rule does not present a clear and fair system in which immigrants will have the same rights as U.S. workers or U.S. entrepreneurs in the marketplace. Therefore, the immigrant entrepreneur will have no leverage to negotiate the terms of the contract and relationship with and they will be susceptible to exploitation in a novel way as proposed in this regulation. Even if a path to U.S. permanent residency is proposed, it will in all likelihood, be at the expense of the current backlog of employment based immigrants in the permanent residency process.<p>In essence, the new immigrant would pay (in the form of hefty investment in the firm) for his or her travels to the United States only to remain in bondage relationship to the hand-picked VC firm. If this is not a definition of indentured servitude, then what is? Worse yet, the paroled immigrant has no defined wage requirement as a worker in the firm and has very lenient “income threshold” (400 percent of Federal Poverty Level for family size - irrespective of the prevailing wages of the entrepreneur’s job functions) as outlined in the proposed rule. It is well known that such system only increases the demand for new immigrants because of their lower leverage and bargaining power in such relationships, while the American workers and entrepreneurs are discriminated against in the talent ecosystem.<p>In justifying the rule, DHS presents “significant public benefit” such as entrepreneurship and job creation by immigrant founders. This reference to various studies is grossly misleading in that DHS uses contributions of immigrant founders without crediting the fact that most of these immigrant founders had gained sufficient certainty in their immigration process by obtaining a Green Card prior to making a significant investment in the companies they founded.<p>The H-1B and L-1B programs were also created under the pretext of “job creation and innovation in the United States” and 25 years after the inception of these programs, the American high-skilled workforce consists of an estimated 1.5 million high-skilled law-abiding immigrants who are captive to their employers and cannot start their businesses and create jobs. This is clearly detrimental to the prospects of our fellow American workers who compete against the captive workforce of skilled immigrants who are favored by bad employers for their lack of job mobility.<p>For the purpose of bringing in more immigrants from outside, DHS uses the disguise of “significant public benefit” only to pile up fresh immigrants in the Green Card backlogs in which the new immigrants have fewer rights (as will clearly be the case with the proposed class of Entrepreneur parolees). It is ironic that DHS did not use the same “significant public benefit” arguments for providing rights such as job mobility and ability to start their own companies by high skilled immigrants, who already have approved immigrant petitions (I-140), understand the business environment in US, have great ideas (and hold patents in many cases) and have investments to start their businesses. But somehow DHS and Administration is very selective in applying the same “significant public benefit” argument for NOT letting people with approved immigrant petitions to start their companies. This clearly raises doubts as to whether any economic argument by the DHS in the rule making process is trustworthy. The proposed regulation ensures that there will be absolutely zero “significant public benefit”. Instead, the proposed regulation is only designed for “significant benefit of hand-picked Venture Capitalists”....&quot;<p>Complete comment: <a href="https:&#x2F;&#x2F;drive.google.com&#x2F;file&#x2F;d&#x2F;0Bwdh5aYDQTwIbGVkR2Z6LV9FVTA&#x2F;view" rel="nofollow">https:&#x2F;&#x2F;drive.google.com&#x2F;file&#x2F;d&#x2F;0Bwdh5aYDQTwIbGVkR2Z6LV9FVTA...</a>

Earning a lot of money is a pretty damn good proxy for contributing to society. At the very least these people pay some taxes instead of being a drain on society.

God forbid that Americans want to hire and grow American talent, right guys? I mean that&#x27;s just awful.

You lost me at &quot;Trump administration has plan&quot;.