President Obama’s International Entrepreneur Rule provides international entrepreneurs a welcome additional visa route into the United States.
The Obama Administration’s proposed international entrepreneur rule grants international entrepreneurs entry into the United States to start new businesses. This is a significant policy decision that will provide a much-needed process to provide the opportunity to international entrepreneurs to bring their skill to America and create jobs and growth to the United States.
The move provides real substance to the President’s legacy in immigration, helping to keep the United States as a world leader in innovation, offering an additional solution to an immigration scenario that complements the existing, more restrictive processes.
Under the International Entrepreneur Rule, the Department of Homeland Security will use existing discretionary parole authority for entrepreneurs of startup entities that can deliver significant public benefit through rapid business growth and job creation. Once the notice of the proposed rulemaking is published in the Federal Register, the public will have 45 days from the date of publication to comment. However, the rules are not subject to congressional approval.
Entrepreneurs Have Two Tier Options for Admission
The first option grants entry for two years. To qualify:
- Founders must own at least 15% of the startup and have an active and central role within its operations.
- The startup must have been founded in the United States within the past three years and must be able to demonstrate potential for rapid business growth and job creation, evidenced by:
- receiving significant investment of capital of at least $345,000 from qualified U.S. investors;
- or by receiving significant awards or grants of at least $100,000 from certain federal or state government entities.
The second-tier grants founders’ admission for an additional three years. To qualify for that, founders must:
- continue to run their business in the U.S. while retaining at least 10% of ownership, as well as raising at least $500,000 from U.S. investors,
- generate $500,000 in annual revenue with 20% growth, or prove they have created at least 10 full-time jobs over the entire 5 years.
The second tier is similar to the existing EB-5 Permanent Residency Green Card, except not as restrictive.
Where the EB-5 requires that the foreign national should be the investor and infuse their funds, this new program permits the foreign national to receive US investment.
We believe that both approaches are positive. The new scenario attracts the best and brightest in the world to come to dynamic regions like Silicon Valley, New York, or Chicago or build other regions to attract start-ups.
How this Ruling will Impact International Start-up Founders
The International Entrepreneur Rule could lead to Permanent Residence such as:
- the EB-1-1 for extraordinary ability if the startup is very successful,
- the EB-1-2 for Outstanding Professors or Researchers if the petitioner works within US universities or non-profit research centers,
- the EB-1-3 if the company is part of an international company,
- the EB-2 or EB-3 through the PERM labor certification process, which would sample the job market to determine if US workers are interested or eligible for the position,
- or the EB-5 if the petitioner is also an investor who may re-invest capital in the enterprise or other enterprises.
What to Expect from the White House Moving Forward
The White House plans to enact this rule before President Obama leaves office in January. Hillary Clinton, if elected, promises to go even further with this new international entrepreneur rule. Her technology agenda plans to open doors for green cards to anyone graduating with a master’s or Ph.D program in the STEM field. Her agenda also supports startup visas for entrepreneurs who can raise funding and create jobs.
However, if Donald Trump becomes president it remains unclear as to what his immigration agenda would be, and whether he might revoke the International Entrepreneur Rule. Trump has previously spoken out against the use of H1-B visas and he vowed to shut down the program claiming that their use depresses salaries and makes it “difficult for poor and working class Americans.”
A Kauffman Foundation analysis found that allowing such startup visas could create up to 1.6 million new jobs for Americans over a 10-year period and add an estimated 1.5% to economic growth. This estimate is derived from data on previous employer firm creation and survival as well as data from the Census Bureau Statistics on job creation.
Another report from the Fiscal Policy Institute’s Immigration Research Center, looked at data from the Survey of Business Owners and the American Community Survey and determined that although immigrants make up 13% of the U.S. population, they make up 18% of small business owners and that those immigrant-owned companies account for 14% of private sector employment and generated approximately $665 billion in receipts in 2007, last year data was available.
What the Start-up Community Has to Say
America must continue to encourage entrepreneurs like Anson Liang, a citizen of Singapore, who lives in the Silicon Valley startup capital of Palo Alto. Liang has been involved in numerous startups from CoffeeTable, an award-winning app that provided digital catalogs for retailers and e-commerce to TrustLeaf, a leading solution for investors and small businesses to Ashley Chloe, one of the hottest wearable technology lines.”
Anson Liang was able to win an EB-1-1 extraordinary ability green card but it required him to launch numerous successful operations, win national or international awards, be appointed to elite associations, obtain critical acclaim in media, make significant contributions, generate significant income, sit on panels and/or publish technical articles.
This new rule will not be based on the foreign national’s accomplishments, but on whether U.S. investors have backed their company and if they will create jobs. It is a natural extension of our current immigration regulations and will have a positive impact on the U.S. economy.
Kristian Kos, an Irish national living in Oklahoma City, obtained an E-2 visa, as the U.S. has treaties with Ireland and some other countries. Kos grew the investment into nine figures of revenue for a number of U.S. companies and hundreds of jobs for Americans.
The proposed immigration international entrepreneur rule will allow entrepreneurs from other nations in the world, like India, China, Israel and New Zealand come to the United States and work with U.S. investors, customers, and skilled workers.
Founders Network
Kevin Holmes of the San Francisco-based, Founders Network, comprised of approximately 500 entrepreneurs around the United States, says, “This rule is an excellent development and is much needed. Many entrepreneurs or potential entrepreneurs are not U.S. citizens; the International Entrepreneur Rule simply creates more opportunity, more jobs, and more success.
Founders Network has worked with the White House in its initiative to promote entrepreneurs in America and around the world. President Obama, Secretary Kerry, and numerous staff brought the 2016 Global Economic Summit to Palo Alto, California this summer.
Holmes goes on to state, “We were excited to promote #GES2016 and sent Founders Network Immigration partner and OnlineVisas CEO Jon Velie along with founders network member Alexandra Greenhill of Vancouver to sit on an expert panel that met and exchange ideas with hundreds of entrepreneurs that came from around the world to the Summit.”
The proposed rule is in line with the President Obama’s support for entrepreneurial expansion as he said in his final State of the Union Address, “America is every immigrant and entrepreneur from Boston to Austin to Silicon Valley, racing to shape a better world. That’s who we are.”
About the author: Jon Velie is CEO of Online Visas, a software and project management company that serves a global network of Immigration attorneys.
Jon has practiced law since 1993 and has represented a World Series MVP, Super Bowl participant, 3 Wimbledon Champions, an NHL All-Star, a first-round NBA draft pick, many Olympic Gold medalists in addition to helping numerous major corporations, individuals, and entrepreneurs.
Jon has briefed three cases to the U.S. Supreme Court, has been featured the New York Times, LA Times, Washington Post, Chicago Tribune, Le Monde, and London Times, featured on a segment of CBS 60 Minutes II and subject of the documentary, “By Blood.”
Jon is the President of Velie Law Firm, winner of the 2014 International Business Award (The Gold Stevie) for Company of the Year-Legal, 2012 Business Excellence Award for Best Overall Small Business in the Americas and 2002 American Bar Association, Equal Access to Justice Award.
References
USCIS Proposes Rule to Welcome International Entrepreneurs – United States Citizenship and Immigration Services – August 26th, 2016 © 2016
https://www.uscis.gov/news/news-releases/uscis-proposes-rule-to-welcome-international-entrepreneurs
Welcoming International Entrepreneurs: Obama Administration announces new steps to attract the best and brightest – By Tom Kalil and Doug Rand on August 26th, 2016<br /> <a https://medium.com/the-white-house/welcoming-international-entrepreneurs-d27571475dfd#.432blb39d
How Much Would a Startup Visa Help the Economy? – By Jessica Stillman on Aug 11th, 2016
http://www.inc.com/jessica-stillman/how-much-would-a-start-up-visa-help-the-economy.html