Photo: wsj.com
Last year in July, the GOP administration announced their intent to end any special visa handling for immigrants who startup companies in the US. If the entrepreneur met certain criteria for funds raised in the US and sponsor financing they were allowed into the US for a period of 30 months. However, the entrepreneur visa could be revoked at any time. President Obama just before he left office in January, 2017 setup the special visa program for immigrant entrepreneurs to jump start more companies and create more jobs. Last Friday, May 25, Homeland Security announced that it was planning on ending the program after winning a court battle with venture capitalists who were seeking to have the program launched. Let’s step back and look at the jobs and startup issue in context.
Do we need more startups in the US? Yes, there are actually more companies dying right now then startups and small companies. While, we hear about the Googles and Facebooks, there are many thousands of startups (usually 10 times more) that fail and other small businesses. Actually the rate of businesses dying has increased dramatically such that more small businesses are going out of business than ones being created.
Do we need more jobs? Yes, while the unemployment rate is at an all-time low, there is another 11 million people who want to work but can’t and have quit looking for work so they are not counted in the unemployment statistics. About, 70 % of all new jobs are created by small businesses not large corporations – who are generally still reducing their workforces.
Do we need more entrepreneurs? Yes, but in the Heartland region of the US. The West Coast, Austin, and Boston, New York areas receive most the venture capital funding for startups. Jumpstarting entrepreneurs and new businesses in the Heartland where we need new job development is crucial to getting the region moving again economically. US local entrepreneurs should receive federal help, venture, university and non-profit assistance in getting businesses started as we have recommended in our Heartland Development Center initiative blog.
Are immigrant entrepreneurs key to growing our economy? Yes, immigrants are increasingly the ones starting new businesses versus native born founders.
Sources: U.S. Census Bureau, Kerr & Kerr, Harvard Business Review – 9/26/16
Immigrants make up a disproportionate amount of the entrepreneur base, experts believe their passion and dedication to building new businesses is strong and drive to make the American Dream come true.
Next steps:
The GOP Administration believes if immigrant entrepreneurs are to be given special visa status that Congress needs to pass a law that specifies how the program works, the number of founders to be admitted and how they are to be selected. We understand the present program for immigrant entrepreneurs is vague and established by executive order. However, President Obama was intent on giving special status to those who could start new businesses quickly and create more job opportunities for workers. Our recommendation is that Congress should be passing a law in regard to immigrant entrepreneurs as part of funding Heartland Development Centers and use the special visa to bring immigrant entrepreneurs to the Heartland where they are most needed after investing and providing entrepreneur support for native born founders. One way to gain acceptance, is to have the immigrant entrepreneur sponsored by a startup co-founder native born person in the region, then have them work together as a team.