EIR Program Works on Immigration Policy

For the past 3 months, I have been working on improving the state of our immigration system with a group of entrepreneurs, investors, and other experts as part of the Entrepreneur in Residence program held by the U.S. Citizenship and Immigration Services.

This Monday, we discussed some of our findings and recommendations for improving the immigration process for entrepreneurs at an event at Georgia Tech. The event was attended by faculty, students, immigration professionals, and others interested in the issue.

The EIR program is designed to bring together experts to find pathways to optimize the current immigration system for foreign-born immigrants who want to start or grow their businesses in the United States. These entrepreneurs represent a key factor in the growth of the U.S. economy, building successful businesses that generate revenue as well as creating American jobs. In a global economy, it is vital that this country retain the top worldwide talent and businesses in order to compete. I wrote more about the program at the beginning of my residency. 

Key areas that we have specifically looked into are the process include the confusing multitude of visa options, training of immigration officers, and policy.

One of the most confusing decisions for an entrepreneur is deciding which of the many visas they should petition for; there is H-1, L, O, OPT for recent grads, etc. We will be launching soon a web resource for entrepreneurs to understand what the requirements for each of those classifications are and what evidence to provide for support.

We also see the training of immigration workers to be a key area where we can implement change: we’ve designed and rolled out training for visa adjudicators on issues such as startup structures, financing, documentation, and operations.

There is still more work to be done in this initiative, particularly on the policy side, so we’ve decided to extend the program for an additional 9 months to continue on this effort. You can follow what we’re doing at USCIS, and stay up to date with other measures to reform immigration, like Startup Act, here on Engine.is.

Innovation Depends on Visa Reform

Foreign-born “computer professionals” represent the largest share of H-1B visa applicants, according to a study released this week from the Brookings Institution. The study explores the demand for the H-1B class of highly skilled professional visas across different U.S. metropolitan areas, assessing which geographical and professional areas rely most heavily on foreign-born talent.

The findings show that science, technology, engineering, and mathematics (STEM) occupations accounted for more than half of all H-1B requests in 92 of the 106 metropolitan areas studied, pointing to the disparity of United States STEM graduates and advanced STEM occupations needing to be filled. The Obama administration estimated in February 2012 that less than half of U.S. students pursuing a degree in STEM fields ultimately earn a degree in a STEM discipline. 

The H-1B visa system also plays a major role for small companies and startups which rely on these highly skilled workers to develop products and services. “Our study shows that private firms account for the vast majority, 90 percent, of requests,” Neil Ruiz, a co-author of the study, said in an email to Engine. The top 100 H-1B employers make up only 20 percent of these visas requests. “I would not be surprised if some of them [the remaining employers] are smaller companies or startups,” Ruiz said. For more from Ruiz, see his video. 

The study also noted that specialized skills tend to cluster in certain regions of the world. For example, 56 percent of the world’s engineering degrees are awarded to students studying in Asia, compared to the United States, which graduates just 4 percent of these degrees.

Clustering effects aren’t limited to skill set distribution. Innovation centers in the United States are situated near universities, metropolitan areas endowed with venture capital, and research and development hubs. These areas, from the tech hub of Silicon Valley to the Research Triangle Park in Durham, North Carolina, rely on the H-1B visa program to stock the talent pool for startups in need of highly skilled workers.

The H-1B visa is an essential tool for growing technology centers and the economic benefits they provide. The study’s recommendations include forming a non-governmental, non-political commission to assess the needs of metropolitan areas and assign H-1B caps accordingly.

Legislation proposed this year, including measures such as Startup Act 2.0, seeks to eliminate per-country visa caps, along with other measures designed to allow tech businesses easier access to the foreign-born talent they need in order to grow and thrive in a globally competitive market.

It has become more and more clear that domestic demand for highly skilled labor is outpacing supply. This gap must be addressed by policymakers before the lack of STEM-educated professionals dampens innovation, growth, and entrepreneurship in the U.S. economy. We support measures introduced by lawmakers to end the cap system that arbitrarily prevents talented individuals working for U.S. companies. Policymakers should also consider reforms of the immigration system that would make it easier for entrepreneurs to enter the U.S., start businesses, and create American jobs.

Image from the Brookings Institute.

Entrepreneurs Need Startup Act 2.0

Earlier this week, the office of Senator Jerry Moran, a leading co-sponsor in the Senate of Startup Act 2.0, released a short video detailing the need for reform of the immigration processes for entrepreneurs as would be enabled by Startup Act. 

In the video, Morpheus Medical Co-Founder and Engine member Fabien Beckers, a French citizen by birth, tells his story, and outlines why, despite receiving his education in the U.S. and founding a company here, he and his employees may be forced to close up shop because of his visa situation. 

Check out the video at Sen. Moran's YouTube page here, and remember to call your member of Congress today at http://engine.is/startupact and ask them to co-sponsor and champion Startup Act 2.0 in the House and Senate. With your voice, we can help make this law a reality for founders like Fabien all across the U.S. and keep startups thriving here at home.

High Skilled Immigrants Driving U.S. Innovation

Immigration reforms similar to those proposed in Startup Act 2.0 would help the United States retain foreign students that are driving innovative patents in the domestic economy, according to a report released June 26. The report, conducted by the Partnership for a New American Economy, found that 76 percent of patents issued in 2011 to the top 10 patent-producing universities had at least one foreign-born inventor.

The partnership’s reviewed 1,466 patents awarded to the top 10 schools and highlighted the endowment of foreign-born inventors on patents in “cutting-edge fields.” These inventors were observed to contribute to as many as 87 percent of patents issued in fields which include semiconductor device manufacturing, information technology, pulse or digital communications, pharmaceutical drugs or drug compounds, and optics.

Patents are one measure of new and innovative products developed in the U.S. economy. The report doesn’t just present the statistics, it also shares some of the stories behind the people and projects these patents protect. Innovators from Cyprus, Malaysia, and India involved in patents for technologies behind seawater purification, enhanced digital photography, and strong-as-steel metal that can be molded like plastic.

Foreign-born innovators like these may blossom as domestic-entrepreneurs after emerging from academia. Engine recently featured one such immigrant entrepreneur Rutul Davè, co-founder of Bright Funds -- one of 18 startups that attended Startup Day on the Hill. Rutul earned a master’s degree in computer science before founding his growing startup.

Research and development spending at U.S. universities has increased five-fold over the past 25 years, growing from about $10 billion in 1985 to nearly $50 billion in 2007. Harnessing spillover benefits of this research is critical to the growth of high tech industries. With STEM job growth anticipated to continue through 2017 and less than half of U.S. college students completing the STEM degrees they start, more highly-skilled workers are needed for the U.S. to remain competitive.

Startup Act

2.0 tackles the issue of highly-educated immigration head-on, creating new visas for MA and PhD recipients in STEM fields and extending their ability to find and accept work with companies in the United States. You can learn more about the measure and contact your representative about immigration at www.engine.is/startupact.

Take Startup Act One Step Further, says Marvin Ammori

Startup Act should include a provision to encourage training in computer programming in the U.S., says Marvin Ammori in a piece for the Atlantic today.

The tech world is coming out in strong support of Startup Act 2.0, a bipartisan bill that eases the way for entrepreneurs to hire the foreign-born high-skilled workers they need to build and scale high-growth startup businesses without moving offshore.

While making changes to the skilled immigration process is an essential measure in getting startup talent in this country, Ammori writes that Startup 2.0 is “a great bill, but it could be better”. The gist of the article is that the key to unlocking success for future generations of startups is in setting up all Americans for success in innovative and technology based new businesses -- this means giving public schools funding and incentives to teach all kids how to code, just like all kids are taught basic math and grammar, Ammori says.

An entrepreneurial mentality will be key in navigating the requirements of today’s job market, and the current education system which encourages an obedient worker mentality is unsuited to an economy that increasingly relies on new startups and innovation. Further than encouraging entrepreneurship in our students, though, we should be equipping kids from an early age with programming skills that are fast becoming as ubiquitous a requirement as learning english or math.

Ammori suggests federal government involvement , suggesting that a new iteration of the bill, “Startup Act 3.0, could fund grants for expanding programming classes, beginning with small-scale pilot programs”.

Ammori’s views might not be revolutionary, but he is dead on the money when it comes to the need for a multilateral approach to the dearth of high-tech graduates coming out of U.S. universities. The short term solution is fixing the skilled immigration system, as Startup 2.0 does. The longer term solution is catching the U.S. education system up to the economy of today and the future. We as a country need to set a course on both of these goals, and we can’t afford to wait.

Click here to learn more about Startup Act 2.0 and connect with your representative to let him or her know that it’s important to you.

Sen. Jerry Moran on Startup Act 2.0

With the House of Representatives introducing parallel legislation to the previously-introduced Senate bill, Startup Act 2.0, this morning, we took the opportunity to sit down with Kansas Senator Jerry Moran to talk about the bill and its prospects. Moran, one of the original sponsors of the Senate bill, and a formidable advocate for entrepreneurship and startups in the Senate, spoke about his views on the bill, the issues, the chances of passing the bill and more.

Tell us a little bit about the Startup Act 2.0. How does it compare to the original Startup Act and what’s new and better about this version?

Startup Act 2.0 is a bipartisan jobs bill written to spur economic growth by targeting policies toward the young companies that are responsible for creating almost all of the net new jobs in America. It contains many of the provisions of the original Startup Act but also adds two new job-creating ideas.

Startup Act 2.0 incorporates language from the Coons-Rubio AGREE Act to eliminate the per-country cap for employment-based immigrant visas, which has been a major factor in causing the backlogs that currently hamstring our legal immigration system.

In addition to eliminating the per-country caps, Startup Act 2.0 creates a targeted research and development (R&D) tax credit for startups less than five years old with less than $5 million in annual receipts. Because the current R&D credit can only be used against income taxes a company pays, startups without taxable profits cannot benefit from the credit. The R&D credit created in Startup Act 2.0 is designed to allow startups to offset employee taxes—helping these young companies grow and create jobs.

How does Startup Act 2.0 help small- and medium-sized companies and startups?

To build a successful startup, an entrepreneur needs a good idea, talented employees, capital, and an environment that fosters growth. Startup Act 2.0 creates new opportunities for talented foreign- born students and workers to stay in America so that they can employ their skills at innovative startups. It also makes smart changes to the tax code that will encourage investment in startups and will reform the federal regulatory process so that entrepreneurs can spend more time growing their company rather than trying to comply with government mandates.

The Startup Act seems pretty uncontroversial -- after all, who is going to argue with enabling job creation in a post-recession America? What kind of shot at getting this legislation passed this year do we really have, and how can Engine and its members help make this happen?

Many Washington critics say nothing gets done in an election year. Yet, our country cannot wait another 6 months or more to act on commonsense job creating ideas. Other countries are not taking this year off and Congress shouldn’t either. Since March 2012, seven countries have changed their laws to attract talent or offer incentives for entrepreneurs and new companies. This is an urgent issue that demands attention now.

Given the stalled immigration bill proposed by Rep. Chaffetz, passed in the House but stalled in the Senate, it seems like there could be definite roadblocks for the Startup Act. Are there some things that are more likely to pass than others? Is this an all or nothing kind of deal? What kind of opposition do you anticipate and what are you planning to do to give this legislation the best chance of passing?

Startup Act 2.0 is more than an immigration bill - it is the jobs package of this Congress. As unemployment remains above 8 percent for nearly 40 months, Americans are losing faith that Congress can help our struggling economy. Despite the hyper-partisan environment in Washington, this legislation has strong bipartisan support in both chambers. Additionally, Startup Act 2.0 creates American jobs at little to no cost to taxpayers, making the package attractive to many members concerned about our country’s fiscal situation.

Cantor: No Limits to Entrepreneurship, Continue the Startup Discussion

House Majority Leader Eric Cantor pushed the cause of entrepreneurs and startups on Capitol Hill today, emphasizing the importance of government’s role in the formation and success of small businesses. America should be the “Startup country,” the Virginia representative said at a conference on entrepreneurism, “We want to be the destination for the world’s best and brightest, for those willing to work hard, to take a risk and make something of themselves.”

Lawmakers are continuing to shift their focus to issues facing entrepreneurs, startups, and small business this year. Despite the presidential election, partisan division, and other seemingly intractable differences, members of both parties have been able to agree that Washington needs to get to work for startups.

Last week, a bipartisan group of Senators -- Jerry Moran, Mark Warner, Marco Rubio, and Chris Coons -- introduced a bill titled Startup Act 2.0 which would make critical reforms to the immigration system, incentivize the rapid commercialization of research and development, and lessen the tax burden on profits made by small, thriving firms. Engine encourages lawmakers in the House of Representatives to take up similar legislation to bolster small business, help startups hire talented workers, and incentivize the development of innovative products and services that grow the American economy.

Midweek Policy Roundup

Immigration

Senators Jerry Moran, Mark Warner, Marco Rubio, and Chris Coons introduced Startup Act 2.0 on May 22, building on measures introduced in December 2011 that create more visas for immigrants with advanced degrees in STEM fields, among other critical reforms for startups. Engine’s coverage here.

Privacy

The Federal Trade Commission announced the final agenda for a May 30 workshop focused on privacy disclosures for advertising and social media on mobile devices. The workshop, titled “In Short: Advertising & Privacy Disclosures in a Digital World,” will include participants from companies such as Facebook, Groupon, and TRUSTe. 

The FTC also announced the hiring of Paul Ohm, an associate professor at the University of Colorado, to serve as senior policy advisor for consumer protection and competition issues in the agency’s Office of Policy Planning. Mr. Ohm specializes in information privacy, computer crime law, intellectual property and criminal procedure, according to his personal website. 

Spectrum

The Federal Communications Commission held a workshop on channel sharing May 22. Channel sharing is an approach to broadcasting where two stations use the same broadcast infrastructure and television channel. This may maximize the amount of spectrum available in new wireless auctions. The commission will also consider a report and order on plans to ease the transition from 2G to more advanced technologies at its open hearing May 24. 

Cybersecurity

On May 21, Senator Ron Wyden gave a speech on the Senate floor opposing any cybersecurity legislation that would limit Americans’ privacy. The speech came as the Senate is said to be considering new cybersecurity legislation. Watch the speech here. 

Policy Update: Startup Act 2.0

Engine has been following closely the evolution of Startup Act, legislation designed to ease the way for startups to access the capital, skilled labor, and research that enables them to grow and prosper. We’re excited to bring to your attention the new and improved Startup Act 2.0, which was released this morning.

We voiced support for S.1965, the original Moran-Warner Startup Act, in March, which promised to provide tax credits for startups, reform the process by which foreign-born STEM graduates of U.S. universities are granted visas, and spur innovation by providing incentives for the commercialization of university research.

Startup 2.0 keeps many of the provisions of the original, and adds key measures for skilled immigration from the Coons-Rubio AGREE act -- in particular, the removal of per-country visa caps. A new R&D tax credit specifically for startups with less than $5 million in annual receipts has been added to allow startups to offset employee taxes and to counterbalance the existing credit which is overwhelmingly used by businesses with over $1 billion in receipts.

After consultation with universities, the new version of the Startup Act modifies the provision dealing with university research to ensure that the rules set forth in the Bayh-Dole Act are not altered. Bayh-Dole, or the Patent and Trademark Law Amendments Act, was adopted in 1980 to ensure that small businesses, universities and nonprofits have ownership of intellectual property created from government funded research.

Some of the earlier measures of Startup Act, such as the call for a comprehensive analysis of the impact of Sarbanes-Oxley on startups, have been removed from the new version due to an overlap with JOBS Act, which was passed earlier this year and dealt with access to capital for startups, most notably legalizing crowdfunding. The income tax credit of S.1965 has also been eliminated as a means to making the bill more fiscally feasible, with Startup 2.0 costing less than 20 percent of the original bill.

We are encouraged by the Senate’s willingness to work on policy initiatives that will have a direct impact on jumpstarting the American economy. We look forward to their colleagues in the House following suit. It’s time to set the table for legislation like Startup Act 2.0 and continue the debate on these fundamental issues that drive our economy.

Correction: An earlier version of this article incorrectly stated that the capital gains exemption of the original Startup Act has been eliminated. The actual provision removed for the release of Startup 2.0 is an income tax credit. Startup 2.0 features a permanent exemption of the capital gains tax on startup stock held for at least 5 years. 

Midweek Policy Highlights

This week in Washington: the FTC goes deeper on privacy, Facebook amends its SEC filing to account for potential regulatory review, and immigration and spectrum remain hot topics.

Finance

Facebook amended its S-1 filing with the Securities and Exchange Commission ahead of its initial public offering May 15. The filing extended the expected closure date of the $1 billion Instragram purchase from the second quarter of 2012 to 2012 generally. The move could signal deeper scrutiny by regulators on the competitive impact of the deal. Currently, the transaction is in a procedural 30-day review under the Hart-Scott-Rodino Act premerger notification program. Engine will continue to monitor the review and its potential impact on future startup acquisitions.

Privacy

Associate director of the Federal Trade Commission’s division of privacy and identity protection Maneesha Mithal spoke at a Congressional Internet Caucus event on Monday about the agency’s recent report on privacy. She highlighted recent settlements with social networks including MySpace that involved companies’ adherence to their privacy policies.

Edward Felton, the agency’s chief technologist on leave from Princeton University’s Center for Information and Technology Policy, also blogged this week on the technical details of recent moves by the government to address privacy on social media platforms.

Immigration

Engine blogged earlier this week on moves by the Department of Homeland Security and Congress that may help startups gain access to more highly-skilled immigrant workers. Senator John Cornyn is said to be introducing a bill that would boost the number of visas available to immigrants with graduate degrees in science, technology, engineering, and mathematics fields.

Spectrum

Federal Communications Commission chairman Julius Genachowski is slated to give a speech May 17 at 10:30 EST on spectrum reallocated to support “medical body area networks” (MBAN). GE Healthcare and Philips Healthcare are scheduled to demo MBAN devices. Repurposing spectrum for new technologies is a major priority to open innovation across industries and MBAN is a major development in the healthcare field. A live stream can be viewed here.

Congress Weighs STEM Visas as DHS Extends Some Grads’ Stay

The Department of Homeland Security announced Friday an expansion of the number of Science, Technology, Engineering, and Mathematics (STEM) degree programs that qualify students to stay in the United States after they graduate. The move comes as legislation is set to be introduced that would expand the number of visas available to STEM graduate degree holders. Reforms like these are a step in the right direction toward meeting the demand for highly-skilled labor in the United States.

STEM graduates fuel the startup ecosystem by providing skilled labor critical to startups that develop innovative products and grow the American economy. Research has shown that many high-skilled immigrants go on to start successful companies of their own, further boosting job prospects for native-born Americans and generating large amounts of revenue. On Friday, CQ reported that Senator John Cornyn plans to unveil legislation that may increase the allotment of visas for immigrants with graduate degrees. While no specific language has been released yet, Engine will monitor and update on the bill as it emerges.

Bad immigration policy not only constrains the labor market, it also impedes the creation of entire businesses. U. S. Citizenship and Immigration Services (USCIS) has launched an initiative aimed at easing the visa process for foreign-born entrepreneurs. This is just one step forward in fixing a broken immigration system that is in need of broad reform, but these small changes can have a meaningful impact on small- and medium-sized businesses that are fighting for the talent to make their startups succesful.

“New Tech City”: Improve Education, Expand Broadband, Reform Immigration

Image by kaysha.

Education and immigration reform are vital for the continued success of startups and of the American economy as a whole. A study released on Wednesday highlighted startups’ importance to the economy and recommended broader efforts to incorporate technology in schools and more innovative approaches to the U.S. visa system. In no place are these needs more apparent than the focus city for the study, New York.

The study -- “New Tech City” -- was conducted by the Center for an Urban Future with support from AT&T and the Association for a Better New York. The findings of the study demonstrate New York’s place as a tech hub, eclipsed only by Silicon Valley and San Francisco purely in terms of growth. The study identified 486 startups that had received angel, seed, or venture capital funding in the city of New York since 2007 and more than 1,000 web-based startups, most of which haven’t received funding. The number of jobs in the New York information technology industry grew 28.7 percent over the past five years, increasing by about 12,000 according to data the study drew from the New York State Department of Labor.

The study addresses key issues facing startups around the country, emphasizing the need for the reform of key issues that are affecting startups today. We need immigration reform to allow more highly-skilled immigrants to work at startups, enhancements of broadband and wireless infrastructures to connect businesses and consumers, and support for schools to prepare teens for careers in STEM fields.

Silicon Valley and New York City are known centers of innovation, but the startup story of these places can be replicated in communities all across the United States. To achieve these successes, policy should support small companies, which play a vital role by creating new jobs, improving local economies, and providing consumers with innovative products and services.

Fighting a Global Battle with Startup Act

Sen. Jerry Moran (R-KS) took to the

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Senate floor this morning to urge his colleagues to take action on Startup Act, a bill to facilitate job growth through startup businesses. You can watch the video here.

Startup Act, sponsored by Sen. Moran and Sen. Mark Warner (D-VA), aims to create an environment that makes it easier for startups to thrive and by doing so to boost the U.S. economy. Sen. Moran cited evidence that startups are responsible for almost all new net job growth in the last 30 years, and highlighted the fact that startup growth is slowing down for the first time in recent history -- an indicator that should prompt us to act now to pass policies that encourage the growth of this vital sector of our economy.

Among its many provisions, Startup Act aims to retain top talent in America through the expansion of entrepreneurial visas. Moran said that the danger of creating a hostile environment for U.S. businesses to retain foreign-born talent is that it will start to make more sense for them to move their operations overseas, to places like India and Brazil, where there is access to high concentrations of high-skilled STEM workers -- a situation in which

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this country will lose out.

“The future of our economic competitiveness depends on America winning the global battle for talent,” he said.

Sen. Moran urged Congress to buck conventional wisdom that legislation can’t be passed in an election year and act on these urgent issues. And with an issue as important as securing a place for startups leading the American economy, we hope his colleagues heed his call and begin more work on Startup Act soon.

Energy Department Highlights STEM Education for American Jobs

This week, the Department of Energy is highlighting the importance of science, technology, engineering, and mathematics (STEM) education to the future of America’s workforce. The department devoted about $100 million to smart grid workforce development as a part of the 2009 economic stimulus.

Beyond promoting more sustainable energy consumption in the United States, smart grid technologies provide the opportunity for innovators to develop products and create jobs for American workers. An education agenda that prepares students for a high technology future is a critical component for continued economic growth and a sustainable energy infrastructure.

Startups are already playing a role in smart grid development and deployment. The Energy Department’s green button initiative gives 15 million households access to their energy consumption data by securing commitments from utility companies including ComEd, Pepco and PG&E to use common standards allowing for the development of web and smartphone applications.

The department has also launched the “apps for energy” challenge offering $100,000 prize to software developers that create an application that allows consumers to make the most of the green button data.

CEA Launches Immigration Virtual Lobby Day

The Consumer Electronics Association is holding a virtual lobby day today to ask Members of Congress to take action on strategic immigration reform.

We’ve written a lot about the importance of skilled immigration reform to allow high skilled workers and entrepreneurs to come to and remain in the United States to create jobs for U.S. workers.

Today’s effort focuses on two bills in particular, H.R. 2161, and H.R. 43, which propose significant reforms to the current immigration regime, such as easing the path for foreign students to obtain visas and creating a visa for foreign-born entrepreneurs to start their businesses here subject to specific requirements, as well as provisions to protect U.S. workers and grow the U.S. STEM workforce. The bills are two great first steps in advancing this vital conversation, crucial to the strength and vibrancy of our economy.

It’s encouraging to see increased discussion of this important issue and we urge you to use the CEA’s online tools to speak up. Now is your opportunity to start the dialogue with your representatives on skilled immigration. So stand up, virtually, and make your voice heard on an issue of great importance to our country, and our economy.

Changing Immigration, One Step at a Time

I am a foreign-born entrepreneur. Originally from Peru, I studied engineering in Lima and was awarded a Fulbright scholarship to study in the US: first engineering at the University of Kansas and then business at the Wharton School at UPenn. I followed the immigration process - from J-1 student visa to OPT to H1B to F-1 to green card and finally in 2008 I was naturalized and became a U.S. citizen. I worked at Google as finance lead, head of investments, and manager, working on advertising products, energy, and data platforms. Now, I am co-founder of a seed stage venture fund and consultancy,

Hattery. Our team is growing by the day, and I have the extremely rewarding task of helping new startups grow and thrive.

Recently I was contacted by the U.S. Citizen and Immigration Services (USCIS)  and asked to be part of their Entrepreneur in Residence Program -- a really great initiative to get entrepreneurs, USCIS staff, and other experts together to collaborate on issues surrounding skilled immigration and entrepreneurship. The program embeds a small group of investors and entrepreneurs into the USCIS for 90 days, with clear objectives and deliverables. [Read our post about EIR here - Engine].

As an Entrepreneur in Residence, I’m invited to share my own knowledge based on my experience as a foreign-born entrepreneur in order to better pave the way for future innovation and economic growth spurred by immigrant entrepreneurship. This country’s success is largely based on the hard work and determination of immigrants throughout its history -- a legacy I’m very much proud to be part of. Startups are almost the sole driver of new job growth in this country, and foreign born entrepreneurs are responsible for starting some of the country’s most successful and job-creating companies, like Google. This is something that hits close to home for me -- since it was only after eleven years in the US that I was able to start my first company.

What I and the other participants of the program have found is that the current immigration system for skilled foreign-born workers does not encourage harnessing the talent and drive of foreign-born entrepreneurs to grow the U.S. economy.

Immigration is an issue at a legislative stand-still. While there are some measures on the agenda, the issue of undocumented workers easily gets conflated with skilled immigration and stalls proposed legislation. While it’s important to pursue legislative change, another avenue to explore is optimizing the current system: making it as user friendly as possible, and giving foreign-born skilled workers the tools and resources to use the visas that are currently available. This includes working with the USCIS to train adjudicators on how startups and tech companies have evolved (funding levels, SaaS, incubators and accelerators, etc.), in order to clarify and potentially innovate in the processes for foreign-born entrepreneurs starting companies across the US.

Another way to optimize the current system is to work with the USCIS to change the rules and policies on the current visas -- a measure that doesn’t require going through any legislative branch -- in order to help foreign born entrepreneurs to start their own companies. At the moment, workers here under an H1B visa can’t fulfill the requirements of the visa unless there is an employer-employee relationship, and that’s something we will be looking into in the program.

This country was built on immigration, and I am proud to be here continuing that tradition, with partners like Engine and others in the space who understand the importance of entrepreneurship to growing the US economy. And I’m looking forward to working with the USCIS to find new pathways to success for immigrant entrepreneurs. Read more about the program here.

Luis Arbulu is a Founder and Partner at Hattery, and an Entrepreneur in Residence with USCIS.

Rebuild America: Halt the Brain Drain

We’ve been looking into skilled immigration and its benefits to the American economy. See I through our eyes with this infographic.

Where We Are On Skilled Immigration

Despite being championed by President Obama in this year’s State of the Union and quickly seconded by all candidates in the Republican primary debates — we wrote about it here — proposed reforms of the immigration process for skilled individuals have been stalled in the lawmaking process. Skilled immigration is touted as a no-brainer: it has — supposed — bipartisan support, and there is plenty of evidence to show that bringing in skilled workers from other countries actually creates American jobs by complementing our existing skill-sets and creating more opportunities in fields like computer science and high-tech engineering. Growing demand for visas only highlights the inefficiency of the current system, with H1B applications in the first week of the visa round more than double last year’s. Sadly, for all the rousing rhetoric of bringing in the best and brightest to keep this country great and at the front of the pack, there has been limited advancement on the legislative front.

There are a couple of different avenues being discussed right now with regard to high skilled immigration:

1. Awarding a green card to advanced graduates in STEM fields (science, technology, engineering, mathematics) from US universities — straight from the mouths of Republican presidential hopefuls Newt Gingrich and Mitt Romney. STAPLE Act and Startup Act are the relevant bills for this one, and BRAIN Act follows the same principle but grants a five-year stay in the US to work in a STEM field instead of permanent residency.
2. Creating a new visa for foreign-born entrepreneurs who want to start businesses in the U.S. Startup Visa would allow foreign-born entrepreneurs who receive funding for their businesses and employ non-family members to be granted an employment based visa.
3. Eliminating the per-country cap on H1B visas; maintaining the same number of total visas but changing the distribution to solve the problem of excessively long wait times for high-skilled workers from countries like India and China. The Fairness for High Skilled Immigrants Act and AGREE Act deal with per-country caps.

So where are these bills? Let’s take a look at one of them — The Fairness for High Skilled Immigrants Act. Sponsored by Rep. Jason Chaffetz (R-UT), the bill received overwhelming bipartisan support and passed the House 389-15. Then Sen. Chuck Grassley (R-IA) effectively killed the bill in the Senate, citing a greater need for protections for American workers. Grassley is already critical of H1B, saying in 2009; “Employers need to be held accountable so that foreign workers are not flooding the market, depressing wages, and taking jobs from qualified Americans.”

Grassley’s statement is representative of the commonly cited misconceptions about skilled immigration, so let’s examine them in more detail. First off, with regard to the Chaffetz bill, changing the country caps wouldn’t increase the numbers of H1B visas, it would simply change the distribution process. So, under Grassley’s logic, the new legislation wouldn’t harm Americans any more than they are now. Furthermore, when the current mode of visa distribution was conceived, it was likely optimizing for a diversity of immigrants rather than for a specific skill set need. Altering this model just changes the optimization for our current needs — more skilled high-tech workers from STEM fields.

Then there’s STEM visas, which, according to Grassley, carry with them the danger of flooding the employment market and depressing wages. Actually, it’s pretty unlikely that the amount of visas granted through a program like this would have a big impact on the employment market or wages. The unfortunate truth is, extremely few Americans choose to pursue an advanced degree in STEM, and even fewer — only 8% of all STEM Bachelor’s graduates 10 years after receiving their degree — use that degree for occupations like programming or computer science. Studies show that most Americans currently prefer to pursue other, more creative or prominent fields that use STEM competencies, like healthcare. This is where skilled immigration can be a complement to the existing workforce; filling the unmet demand for workers in the jobs for which most workers born here are not trained. In order to stay competitive globally, we need to remain at the forefront of technological innovation, and that means encouraging those who are educated in the U.S. to stay here after receiving their degrees.

Skilled immigration should be the beginning of a larger conversation about education. In the long term, an increased focus on entrepreneurship and STEM education at a younger age for all American students will help to ensure we remain at the forefront of innovation and growth. Investment in K-12 will iterate in massive gains to American society in a few generations, and will help us grow a high-tech workforce alongside our continued ability to draw and keep overseas talent. In the meantime, we can’t afford to fall behind.

Skilled, foreign-born workers were how this country was made great in the first place, and can continue to drive the engine of economic growth, all while creating American jobs. We need to pay attention to the legislation being proposed, and when we see a bill like the one proposed by Rep. Chaffetz, we need to bypass the hornet’s nest of misconceptions and competing political interests to get it passed.

Combatting America's "Brain Drain"

“America no longer has a monopoly on knowledge”.

So said Vivek Wadhwa; tech entrepreneur, academic and one of the panelists at an information summit we went to today for the Entrepreneurs in Residence (EIR) program. EIR is a Department of U.S. Citizenship and Immigration Services (USCIS) led initiative to get entrepreneurs, experts, and USCIS staff together to discuss the problems and possible innovations around immigrant investors, entrepreneurs, and highly skilled workers, and today was the initiative’s official launch.

The initiative aims to combat “brain drain” -- the idea of highly-skilled workers leaving the US after getting their education here to start businesses in their homelands --by moving on skilled immigration, an issue that’s ostensibly nonpartisan and noncontroversial. A brain drain is what America will experience if we’re unable to attract and retain the best, smartest workers and entrepreneurs -- these people will move overseas and innovate and create businesses there, harming U.S. competitiveness in the global arena.

Studies show that foreign-born entrepreneurs are responsible for creating thousands of American jobs and generating billions of dollars in revenue. Michael Moritz, panelist and partner at Sequoia Capital, said that the number one problem facing the economy today is the need to bring to America these entrepreneurs who want to start companies -- but it’s not just getting them here, it’s keeping them here. Solutions on the table include removing per-country caps on skilled worker visas via H.R.3012, a bill that’s already working its way (slowly) through the legislative process, “stapling” a green card to graduate level students’ STEM degrees, and a startup visa.

In practice, in an election year, and with the Congress that we have, moving on anything is tricky. But, as President Obama noted in his State of the Union address, making some tweaks to skilled immigration has a much better chance of success than comprehensive immigration reform. However, there’s plenty in the pipeline for this issue. California 16th District Congresswoman Zoe Lofgren spoke today about her IDEA Act of 2011 as part of the answer to these problems. And we’re also following the Startup Act, a legislative agenda for startups that includes skilled immigration reform as part of a package of fixes to make it easier for entrepreneurs to start businesses that will create jobs and bolster the economy.

In the end, we’re hopeful the EIR process bears fruitful results and finds new pathways to success on the immigration front. If today’s event was any indication, they seem well on their way, and it’s time to step up pressure on Congress and the White House to act on these issues with innovative solutions.