The Wall Street Journal posted an article today about the various Start Up Acts pending in congress that will allow entrepreneurs to receive immigration benefits. This is a great summary of the bills pending as well as the necessity for such laws. I sincerely hope 2012 sees some form of this law passed. For ease of reference, below is a copy of the article. – Tahmina
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December 20, 2011, 11:00 AM ET
In ‘Next Big Thing’ Start-Ups, Immigrants Dominate Management Ranks
By Venture Capital Dispatch
- Immigrants have started nearly half of America’s 50 top venture-funded companies and are key members of management or product development teams in almost 75 percent of those companies.
Those are the results of a new study by the National Foundation for American Policy, which cites the numbers in calling for changes to immigration policy to make it easier for immigrant entrepreneurs to come to the United States and begin building companies.
Using the “Next Big Thing” list of Top 50 venture-funded companies published in March 2011 in The Wall Street Journal and compiled by research firm VentureSource, a unit of Journal owner News Corp., the research finds that 46 percent, or 23 out of 50, of the country’s top venture-funded companies had at least one immigrant founder.
The research also found that 37 of the top 50 companies, or 74 percent, had at least one immigrant helping the company grow and innovate by filling a key management or product development position. Chief technology officer, chief executive and vice president of engineering are the most common positions held by immigrants in the top 50 venture-backed companies.
The most common country of origin for an immigrant founder of a top 50 venture-backed company was India, followed by Israel, Canada, Iran and New Zealand. Other founders and co-founders were born in Italy, South Africa, Greece, Norway, Germany, the United Kingdom, Singapore, Switzerland and France.
The report contained interviews with entrepreneurs who spoke of the appeal of the United States when it came to building businesses.
Dr. Stefan Kraemer, who founded EndoGastric Solutions, said he came to the United States specifically to start a company. “In Germany, people would have told me, ‘What are you doing, you’re a surgeon, why do you want to do anything else, like start a company?’ said Kraemer. “To me, America is about having a dream and being able to realize it.”
Jeff Graham, the British-born CEO of RGB Networks, echoed Kraemer. “In the rest of the world, when someone presents an idea, the response is often, ‘Here’s why you can’t do it.’ In America, the response is, ‘Great idea.’ That is a unique strength as a nation.”
The NFAP says better legislation is needed to keep entrepreneurs coming to these shores and continuing to build businesses that create jobs and drive the economy.
“U.S. immigration policy does not look kindly on foreign nationals who seek to create businesses in America,” according to a companion report by the NFAP, also released Tuesday. “In fact, in a practical sense, it may be easier to stay in the United States illegally and start a business than to start a business and gain legal temporary status and permanent residence (green card) as the owner of that business.”
A number of bills in Congress have been introduced that would establish an immigrant entrepreneur visa. The Startup Act (S. 1965), introduced by Senators Jerry Moran (R-KS) and Mark Warner (D-VA), would create a new green card category for entrepreneurs, focusing on highly skilled foreign nationals with an existing tie to the United States. Among the requirements of the bill are that the recipient invests or raises capital investments of at least $100,000.
The Startup Visa Act of 2011 (S. 565), introduced by Senators John Kerry (D-MA) and Richard Lugar (R-IN), would make an immigrant visa available to a foreign national who raises various levels of capital investment, among other requirements.
Legislation by Rep. Zoe Lofgren (D-CA), H.R. 2161 (The IDEA Act) contains similar provisions on establishing an immigrant entrepreneur visa to those contained in S. 565 and S. 1965. However, it also contains a section that eschews capital requirements and enables a foreign-born entrepreneur to receive an immigrant visa if he or she creates 10 or more full-time U.S. jobs within two years, without regard to the amount of outside capital raised.
Legislative measures that place less emphasis on the amount of capital a foreign national invests or raises fit best within the American tradition of entrepreneurship, the report said. It also conforms to today’s reality of how businesses get started. The average entrepreneur starts his or her company with only about $31,000, according to the Kauffman Foundation.