Moderna, Pfizer, Google, Tesla.
These iconic companies are helping to drive the 21st century economy. Collectively they employ hundreds of thousands of Americans. And all were started by immigrants.
Their founders also had to overcome unnecessary barriers that have blocked the path of other foreign-born entrepreneurs.
We have seen this saga too many times: An entrepreneur has a great idea, top-notch team, and backing from a venture capitalist but cannot start a new American company.
Why? Because our country’s immigration policy is stacked against foreign-born founders. Unlike many other developed nations, the United States lacks a startup visa that makes it easier for immigrant entrepreneurs to launch innovative new businesses and create jobs.
Instead, they must rely on existing visa categories such as H-1B, O-1, or E-2 that impose strict limits on the number of applicants accepted each year, the kinds of people who qualify, and how long they must reside in the United States before they’re able to launch their own companies.
Take Jyoti Bansal for example. He entered on an H-1B visa but had to wait 7 years before his immigration status allowed him to start AppDynamics. My venture firm and others had the opportunity to back Jyoti in his journey as AppDynamics grew, hired more than 1,200 Americans and was then sold for $3.7 billion.
Fortunately for our country, Jyoti received a green card and could launch his company. But the same can’t be said for other entrepreneurs. As Jyoti said: “I have friends who became frustrated with the uncertainty, and after years of waiting they finally left the United States.”
Thankfully, Silicon Valley’s own Rep. Zoe Lofgren, D-San Jose, has a plan to fix this problem. The Let Immigrants Kickstart Employment (LIKE) Act would create a startup visa for immigrant entrepreneurs who attract investment and create American jobs. It would also provide a jolt of needed economic activity as our economy recovers from the pandemic.
According to the Kauffman Foundation, a startup visa proposal like Lofgren’s could create up to 1.6 million jobs over 10 years — a number that could prove significantly larger if one of those companies becomes the next Amazon or Google. In addition, Rep. Lofgren’s new bill stands to create even more jobs because it lifts caps on startup visas that were in previous proposals and is easier for entrepreneurs to use.
Other countries have answered this challenge by creating startup visas of their own. As a result, Canada, the United Kingdom, Australia and more than 20 other countries are rolling out the red carpet for foreign-born entrepreneurs who want to start new companies on their soil. (The United States is competing with these countries to attract the best entrepreneurs in the world.)
Lofgren is the perfect person to advance a proposal like this. As chair of the House’s Immigration subcommittee, she’s deeply involved in immigration policy. Because she represents Silicon Valley, Lofgren understands the problems foreign-born entrepreneurs encounter and also how to fix them.
As a former immigration attorney and professor of law, Lofgren is intimately familiar with the storied role immigrant entrepreneurs have played in our country’s history. For example, 44% of Fortune 500 companies were founded by immigrants or their children. One-third of VC-backed companies that have gone public in the United States — and more than half of all billion-dollar “unicorns” — had at least one immigrant founder.
The venture and startup ecosystem should rally behind Lofgren’s thoughtful proposal. Our country needs more entrepreneurs if we want to recover from the economic devastation of the pandemic. Immigrant entrepreneurs are a common-sense way to bring innovation and new jobs when we need them most.
Barry Eggers is a founding partner at Lightspeed Venture Partners and the former chairman of the National Venture Capital Association.
