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Q&A: U.S. immigration policy and entrepreneurship

MIT’s Bill Aulet, Danielle Guichard-Ashbrook and Edward Roberts discuss the challenges facing foreign-born entrepreneurs under U.S. immigration policy.
Image: Christine Daniloff/MIT

For U.S. citizens, the initial challenge of starting a business in America could be scraping together startup funds; for foreign-born entrepreneurs, the challenge is usually staying in the country. Under U.S. immigration policy, foreign nationals face strict visa requirements to get a company up and running, which can chase them back to their homelands or to nations offering easier visas. Because of this, policy reform has become a hot topic, recently gaining traction in Congress with the proposal of Startup Act 3.0, which would facilitate special “startup visas” for qualified immigrants.

But should we be trying to retain foreign talent? How will reform affect our nation? MIT News recently spoke about these issues with three MIT experts: Bill Aulet, senior lecturer at the MIT Sloan School of Management and managing director of the Martin Trust Center for MIT Entrepreneurship; Danielle Guichard-Ashbrook, associate dean and director of MIT’s International Student Office; and Edward Roberts, the David Sarnoff Professor of Management of Technology at MIT Sloan and founder and chairman of the Trust Center.

Q. What are major challenges facing foreign-born entrepreneurs under current U.S. immigration policy? What policy changes do you suggest?

Guichard-Ashbrook: The major challenge to foreign-born entrepreneurs is that in current U.S. immigration law there is no appropriate visa for them upon college graduation. The traditional H-1B visa is contingent upon sponsorship from an established company with a substantial number of U.S. workers. Establishing a new visa category specifically designed for foreign-national entrepreneurs would solve this problem.

Roberts: Foreign graduate students who are enrolled in our entrepreneurship programs … tell me that they have problems with their visas from the outset, providing a negative message from the United States about their desirability. Unless they get a sponsor, they have big problems in remaining beyond their student visas. They encounter major issues if they want to start a company on their own here, needing to learn rules, laws and gambits around our regulations.

Aulet: I recommend a startup visa program for founders of companies. These people are true job-creators and we make them feel unwelcome. Also, we need to have a more customer-service-oriented process to encourage them to stay or we will lose them to places such as Canada, Chile or the United Kingdom.

Q. Why should we, as a nation, want to help foreign-born entrepreneurs stay in the United States?

Roberts: My data on 50 years of MIT entrepreneurs, and many studies of engineering manpower, demonstrate that a very high fraction of our new technical manpower, and a higher fraction of our high-tech entrepreneurs, are foreign-born. Providing an easy path for their permanent stay in the United States provides the most significant boost to our jobs and economic growth of any economic policy.

Aulet: They create jobs. Innovation-driven entrepreneurship companies create more than two-thirds of the net new jobs in the United States.

Guichard-Ashbrook: We need entrepreneurs in the STEM fields [science, technology, engineering and mathematics] in this country to boost our economy. It is a matter of national interest, because the United States does not produce enough domestic master’s and PhD degrees in the highly desired STEM fields. Other countries that we will continue to compete with for the best and brightest entrepreneurs have already made their immigration regulations more favorable. We — at MIT and other peer institutions in the United States — educate them and other countries snap them up, with competitive salaries and more streamlined paths to work visas and permanent residency.

Q. What are your thoughts on Startup Act 3.0?

Aulet: I worry about the process and what I hear is coming from these bills. There is no lobby for immigrants starting new companies, but there is a big one for [established tech] companies. The big tech-company lobbyists will push for more H-1B visas and the startup visa issue will take a back seat.

Guichard-Ashbrook: The startup visa proposal would be wonderful, but government needs to move fast. Other countries have already established favorable immigration policies for startup ventures. Historically, Congress has tended to move at a snail’s pace when it comes to immigration reform. Hopefully, the momentum is there now with broad bipartisan support for this specialty visa. It would not only be good for talented foreign-born entrepreneurs, but … the companies formed would provide jobs to U.S. workers, boosting the economy.

Roberts: For years, I have argued that all foreign graduates of accredited U.S. universities in the areas of science, engineering and management should be given long-term visas, good for as long as they stay in such roles, and a quick path toward citizenship. Anyone starting a real technology-based company, with minimal capital input from angel investors or venture capital firms, should be given a quick path.

Q. A number of countries — such as Canada, China and Australia — have started offering easier visa processes and various benefits to attract foreign-born entrepreneurs. Will their willingness to accommodate foreign talent affect the United States? Why or why not?

Guichard-Ashbrook: Despite having challenging immigration regulations, the United States is still perceived to be the most desirable place in terms of valuing the creative, entrepreneurial spirit [and offering] competitive salaries and quality of life. But this could rapidly change if we do not create the means through immigration reform to retain the world-class entrepreneurial talent that we ourselves educate.

Aulet: Right now, immigrants still want to come to the United States, and put up with a whole lot more [to do so]. Canada, China, Australia, Chile, the U.K. and many more are more welcoming to immigrant entrepreneurs. There is a battle for this talent that is only starting now. We will feel insulated from it until the day when the difference becomes so great that top entrepreneurs start to go to other places, and then the halo will be cracked for the United States. I hope we are not fooled into a sense of comfort because of our current advantages. We have to be, at least, competitive in this area.

Roberts: A huge number of countries, and many regions within those countries, are providing massive financial and regulatory incentives to start technology-based companies. … We are not only losing the foreign students to them as startup entrepreneurs; we are losing increasing numbers of our own U.S.-born students and entrepreneurs to these attractions. The United States is too mired in the politics of illegal aliens when it should be focusing on the entrepreneurial attractiveness of our country to those who will continue, as in the past, to invent and build our future.

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