The Startup Visa Act Must Be Stopped

http://www.businessinsider.com/why-the-startup-visa-is-actually-a-really-bad-idea-2010-3

by bEtsy • 16 years ago

51 44 16 years ago

aditya• 16 years ago

As Dave rightly schooled me here: http://news.ycombinator.com/item?id=1149503

aditya: dude, if you can't create at least 5 jobs in 2 years with $250K in capital, you're a pretty pathetic excuse for an entrepreneur.

The article is a little too sensational, which seems to be the norm with BusinessInsider these days.

pegobry• 16 years ago

That's a good point but it doesn't change that the overall dynamic of the Act would be to put way too much power in the hands of investors.

I hope you're right and that's how it will work out, though.

simon_• 16 years ago

And the stuff about it being "bad for investors" is pretty rich. Sure, there are might be some funny incentives created by a Founder Visa program, but none that wouldn't be transparent, known, and probably avoidable.

rajat• 16 years ago

The biggest issue I have with the Startup Visa Act is that if this is a person that we want to let in because of an investment, then this is a person we want to let in, period. Just give them a green card.

What this act tries to do, in a sense, is outsource the decision making (to the investors).

The biggest problem with the H1B visa is that it allows the employer to hold this unholy ax over the visa holder. It's absurd and counterproductive. These are people we should want in this country. Arguments against illegal immigration do not apply here.

So, if an investor actually invests in a startup with a foreign founder, just give that person a green card or a long visitor's visa depending on what he wants (I assume not everyone wants to move to the US). The whole talk of a successful entrepreneur is ridiculous when so many startups fail. We want that entrepreneur even if this particular venture fails.

BerislavLopac• 16 years ago

Finally a concrete, constructive suggestion that actually makes sense.

wdewind• 16 years ago

I agree 100% in theory, but in concrete it just doesn't work. How do we determine the person is an entrepreneur we want in? It's easy to say if we are going to give them an H1B or a startup visa (whatever that ends up looking like) we should just give them a green card, but it sounds to me like a major part of this issue is who is actually doing the deciding, not only what the decision itself is.

For instance, we trust the government with software patents right now and over and over again they approve what we consider to be horribly damaging patents. We should trust them to evaluate an entrepreneur as well?

There is a reason this decision is outsourced to the employers/investors: it's actually the more free solution. Otherwise it's up to the government to determine who's/what's worth paying for, and just hoping they are right. This way we've already established a market for the person before they enter the country. It's far from perfect, but if you just give people green cards how many people do you think will suddenly want to be entrepreneurs to get their green card?

The government doesn't seem capable of regulating anything right now, so I'm pretty content to outsource the decision to investors and employers. At least that way they have a chance to get a Fred Wilson, instead of a guarantee not to.

fnid24• 16 years ago

That's exactly right. Just let them in. America's all about freedom. Indentured servitude does not need a revival.

jbooth2• 16 years ago

It seems like you're arguing that visas should just be expanded, period. I agree.

The problem is that when you propose something like that, you get all these groups that are opposed, from the "dey took our jawbs" crowd, equally split among the left and right, to the straight up xenophobic crowd, which mostly lean right.

However, if you dress it up and make it sound like we're only importing the right kind of foreigners, with money and oxford accents, it's possible to actually pass something.

So that's what we have. The choice is between whittling around the edges to get a few more people in, or not. Unfortunately, wider reforms are off the table at this point, so a preference for them isn't really a valid reason to oppose incremental bits like this.

geebee7• 16 years ago

I posted a couple of links in a comment below.

A summary is available here: http://www.usatoday.com/tech/science/2009-07-08-science-engi.... The full RAND study is at: http://www.rand.org/pubs/issue_papers/IP241/

This is in reference to a RAND study that provides very substantial evidence that engineering and science careers now lag badly behind other options available to highly educated people in the US.

I think there's a very sophisticated argument to be made that a visa program designed to remedy a "shortage" of engineers doesn't make much sense. I'm alright with disagreement, of course, but it's very frustrating to hear people dismiss this as a "dey took our jawbs" xenophobia. Does it make sense to create a special visa program in a field that is already, according to objective research, lagging behind other fields? Keep in mind, we're not talking about general immigration here, we're talking about very specific legislation targeting a narrow part of the economy.

HowardRoark2• 16 years ago

Does this mean I can't bootstrap my company?

mjhnghfh2• 16 years ago

Of course you can - you just have to bootstrap it in China or India. Then when you are succesfull, and after having created lots of jobs in China or India, paid lots of taxes to China or India and earned lots of foreign currency for china or India.

The US will then allow you to come in and buy their companies - as long as they get a few % commission to Wall st.

charleyrock• 16 years ago

Please give me a break! First, congratulations - your sensational headline got me to read the article. But, other than the "granular" problems you point out, the larger arguments are just silly.

The Act does not tip the power construct unfavorably towards investors. Any VC worth a damn is a partner not an adversary. If a VC uses conditions in the Act to exert leverage in negotiations, he is not worth having as a partner in the first place.

The Act does not increase entrepreneur risk. Every founder has to consider many different areas of risk to his business, to his family and to his lifestyle. Rather than increasing risk, the Act presents an opportunity. As with any opportunity to gain something, there is a chance that you will fail. The Act would only increase entrepreneur risk if it changed the law in that it reduced opportunity - it doesn't.

The Act is bad for (US) investors because good entrepreneurs will self-select away from the US? Come on! That is absurd and in fact the opposite should happen.

Sorry, but the article seemed for the most part insincere or misinformed.

angkec2• 16 years ago

um, I'm new to HN, but how do you downvote a comment?

psranga• 16 years ago

You need to accumulate a certain number of points (by posting comments or stories that get upvoted). Then you get the privilege of downvoting.

pchristensen2• 16 years ago

I think pg, bfeld, ericries, etc would all agree with these complaints about the Startup Visa as presently constituted. The people that wrote the bill structured it so that it would be easy to implement as a first step. It's not meant to be comprehensive, it is a tweak to an existing visa class that's not being fully utilized. But it will give immediate, positive results that can be used to push a more effective, fair, etc version later.

Hacking Washington isn't the same as hacking computers.

philwelch2• 16 years ago

So the legislative approach is to put something out there as quickly as possible and then iterate on it? Fitting.

plinkplonk• 16 years ago

legislation and quick iteration don't go together.

patrickk• 16 years ago

The thing is, iterating on the legislation may not be possible.

If you are a smart, clued-in high tech founder who isn't completely in love with your initial vision, then it's possible to iterate from a potentially disastrous idea into something people will pay for.

With the Startup Visa Act, if the initial flawed piece of legislation doesn't produce some notable successes, then unimaginative lawmen who didn't like the idea in the first place will point to the initial lack of results and kill off any hope of iteration number two or three - which may be what in fact is necessary for the Act to succeed in achieving it's original aims.

pchristensen2• 16 years ago

Not iterate - build on. And immigration reform is somewhere between health care and abortion on the "politically charged" spectrum, so a perfect, sensible solution wasn't coming anytime soon.

gasull• 16 years ago

Is the Startup Visa better than the status quo?

All the criticism about the Startup Visa seems right, but still, for someone seeking a visa it's still better to have also this option than not having it.

People criticize things for not being perfect (or actually very imperfect) when what is important is if it is a step in the right direction. Does the existence of the Startup Visa make things easier for foreign entrepreneurs compared with what we have now? Yes it does.

HowardRoark2• 16 years ago

No it doesn't. Its just another form of slavery like H1b.

fnid24• 16 years ago

It's not slavery, because slavery is not a choice. H1B holders choose to accept the terms and can choose to go home. Slaves can't.

geebee7• 16 years ago

I think it could be worse than the status quo (which is saying a lot, since the status quo is pretty bad).

A lot of people lost confidence in "conditional immigration" categories (ie., we'll let you immigrate provided you become an engineer, an entrepreneur, pick grapes in napa during the harvest season and leave afterwards) after watching how these programs actually work (the H1B, in particular).

I had my own experience with this (as most programmers have). The company I worked for, a "startup", wasn't making much progress and had burned through a lot of cash. Investors and managers got frustrated. They moved the office a long distance and banned telecommuting completely. The took away private offices and put us into a cubicle farm. And, of course, they diluted everyone's stock.

So, what did I do? I quit. But I'm a US citizen, so I didn't face deportation when I did this. But the H1B workers, all Indians who have to wait longer than normal for green cards because of the longer queue, didn't quit. Of course they didn't, they'd been there for 4+ years, are they going to give up now, when they're so close to a green card?

So management pretty much got away with it. Well, they didn't, the company tanked 4 months later, but they sure succeeded in bullying the workers who lack freedom. And the thing is, while I did get to quit, if more and more workers are governed by this arrangement, then this sort of treatment will become the norm, and free citizens will not want to work in that field anymore (which I think is already clearly happening - I personally believe that Americans avoid engineering not because they're too dumb or lazy, but because pay and benefits in engineering are lagging behind other options for highly educated people who are free to pick a different career (1)

Personally, I'm certain that this visa will lead to widespread bullying of tech founders by investors who control their dream of becoming free citizens of the united states. That will be much worse than what we have now.

I can't get behind any type of conditional immigration. I've seen it in action, and I'm convinced these programs are utterly corrupt and end up making the environment so bad that free people will end up choosing other careers (exacerbating the shortages that the programs claim to remedy).

(1) Based on a RAND study

A summary is available here: http://www.usatoday.com/tech/science/2009-07-08-science-engi.... The full RAND study is at: http://www.rand.org/pubs/issue_papers/IP241/

blizkreeg• 16 years ago

I posted a similar analysis a few days back about this Startup Visa. [shameless self-plug] http://vinthanedar.com/2010/02/26/my-thoughts-on-the-startup...

olliesaunders• 16 years ago

The article convinced me there are problems with the act but why must it be stopped? Should I go round with a sledgehammer destroying works of art that are incomplete too?

dlytle• 16 years ago

It must be stopped because it doesn't increase the number of green cards issued, it just reallocates them. As such, it will damage the existing system, rather than just creating a new damaged system.

To build on your analogy, it's like burning half of an incomplete work of art, to get wall space for another one.

ntulip• 16 years ago

A new kind of visa is just insane. An overhaul on how immigration is done in the US needs to be done. Since that won't happen, the next best thing is another band-aid. A Startup Visa.

mjhnghfh2• 16 years ago

I think the startup visa is an excellent piece of legislation. I know of several startups now based here, and lots of budding entrepreneurs moving to town - just because of the Visa requirements. And with this city's links to China and India I'm confident this will be the home of the next big thing.

Of course I'm in Vancouver (BC) and these are guys being frustrated by the US process. Some of them hope to eventually open branch offices in Silicon valley so you will pick up some of the outsourced work.

The Startup Visa Act Must Be Stopped

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