By Maureen Miller Brosnan
NVCA has brought to our attention an urgent policy issue on immigrant entrepreneurship. As you may know, at the end of the Obama Administration the Department of Homeland Security finalized the International Entrepreneur Rule, which is similar to a ‘startup visa.’ The rule will go into effect on July 17, but may be under threat as the rule’s legal underpinning was questioned in a leaked January executive order from the Trump Administration.
MVCA is co-signing a letter in support of the International Entrepreneur Rule, which is designed to show that immigrant entrepreneurship is impactful on emerging entrepreneurial communities and not just coastal VC-markets. We ask our members to share the letter within their regional networks of startups, incubators, accelerators, angel networks, tech transfer offices, business and civic leaders. NVCA will be closing the letter on Monday, May 8.
Share on Twitter: Federal Legislative Alert: @NVCA drafts letter in support of International Entrepreneur Rule. Deadline to sign 5/8: https://ctt.ec/t13z8+
Summary of International Entrepreneur Rule
Immigrant entrepreneurs have always made exceptional contributions to America’s economy, in communities all across the country. Immigrants have helped start as many as one of every four small businesses and high-tech startups across America. Studies suggest that more than 40 percent of Fortune 500 companies were founded by immigrants or the children of immigrants.
The International Entrepreneur Rule will allow the Department of Homeland Security (DHS) to use its existing discretionary statutory authority to grant “parole” (temporary permission to be in the United States) to entrepreneurs whose stay in the United States would provide a significant public benefit, through the substantial and demonstrated potential for rapid business growth and job creation. Under this rule, DHS is establishing clear criteria to identify, on a case-by-case basis, up to 3 eligible entrepreneurs per startup:
- Who have a significant ownership interest in the startup (initially at least 10 percent) and have an active and central role in its operations;
- Whose startup was formed in the United States within the past five years; and
- Whose startup has substantial and demonstrated the potential for rapid business growth and job creation, as evidenced by:
- Receiving significant investment of capital (at least $250,000) from qualified U.S. investors with established records of successful investments;
- Receiving significant awards or grants (at least $100,000) from federal, state or local government entities; or
- Partially satisfying one or both of the above criteria in addition to other reliable and compelling evidence of the startup entity’s substantial potential for rapid growth and job creation.
Under the rule, entrepreneurs may be granted an initial stay of up to 2.5 years to oversee and grow their startup in the United States. A subsequent stay (for up to 2.5 additional years) may be granted if the entrepreneur and the startup continue to provide a significant public benefit as evidenced by substantial increases in capital investment, revenue, or job creation.
This rule was published in draft form in August 2016 and received over 700 public comments providing valuable feedback to DHS from the entrepreneurial community and other stakeholders. The final rule has a Federal Register publication date of Jan. 17, 2017, and an effective date of July 17, 2017, at which point the first applications would be submitted.