TechNet Urges Trump Administration to Preserve International Entrepreneur Visa
Washington, D.C. — TechNet, the national, bipartisan network of innovation economy CEOs and senior executives, is urging the Trump Administration to maintain the International Entrepreneur Rule (IER), which encourages foreign-born entrepreneurs with promising startups to grow their businesses in the U.S. Last month, the Trump Administration published its final rule to rescind the IER.
“In this era of economic disruption and increased competition abroad, we need to exhaust all available policy options to develop and encourage a new generation of entrepreneurs to step forward and fuel the growth of our economy across the country,” wrote TechNet President and CEO Linda Moore in official comments to U.S. Citizenship and Immigration Services (USCIS). “To maintain our competitive edge, we need to win the global competition for talent, and the International Entrepreneur Rule is a key policy to help ensure we win the global competition for entrepreneurs.
“Throughout our nation’s history, immigration has been a key ingredient in making the American miracle possible — a story that is as much about the overall economic prosperity we have achieved as a country as it is about the countless individuals who have made a better life for themselves, their families, their neighbors, and their coworkers here,” added Moore. “The International Entrepreneur Rule is in line with one of America’s longstanding keys to economic success — the welcoming of immigrant entrepreneurs and innovators to this country and allowing their talents to benefit our economy and U.S.-born workers.”
The full text of TechNet’s letter is below and a PDF is available here.
June 28, 2018
Chief, Regulatory Coordination Division
Office of Policy and Strategy
U.S. Citizenship and Immigration Services
Department of Homeland Security
20 Massachusetts Avenue, NW
Washington, D.C. 20529
Re: DHS’s Proposed Rule to End the International Entrepreneur Parole Program
DHS Docket No. USCIS-2015-0006
Dear Chief Deshommes:
TechNet is the national, bipartisan network of innovation economy CEOs and senior executives. Our diverse membership includes dynamic American companies ranging from startups to the most iconic companies on the planet and represents over three million employees and countless customers in the fields of information technology, e-commerce, the sharing and gig economies, advanced energy, cybersecurity, venture capital, and finance.
On behalf of our 86 member companies, I write to reiterate our longstanding support for the International Entrepreneur Rule and urge the administration to preserve it as an important driver of investment, economic growth, and job creation in the U.S.
As you know, the International Entrepreneur Rule is a pro-growth visa program established through Department of Homeland Security (DHS) rule-making and is designed to attract economically impactful entrepreneurs who meet high merit-based standards to grow their companies in the U.S. The rule was originally set to go into effect on July 17, 2017, but DHS delayed its effective date to March 14, 2018, and expressed its intention to ultimately eliminate the program. Last month, DHS published its final rule to officially rescind the International Entrepreneur Rule. We urge the Trump Administration to reconsider and allow this program to continue as a key policy tool to encourage U.S.-based innovation and boost our nation’s startup economy.
Promoting pro-innovation and pro-startup policies go hand in hand. As TechNet co-founder John Chambers has said, “Technology is advancing at a faster pace than ever before, bringing with it unprecedented opportunities for businesses of all sizes and across all industries. We’ve seen digitization enable startups to compete on the same playing field as enterprises, tear down barriers to entry that prevented small businesses from scaling, boost GDP growth, and perhaps most profoundly, enrich the lives of our citizens.”
In other words, startups founded during this digital age hold enormous promise to drive unprecedented economic growth and opportunity as they expand. In 2014, companies in their first five years of life created 2.2 million jobs, while firms older than five years created only 450,000 jobs. This means startups create jobs more than five times faster than more established firms (TechNet and the Progressive Policy Institute). In 2015, the nation’s 414,000 startup firms created 2.5 million new jobs (U.S. Census Bureau). It is also worth noting that America’s gig and sharing economy startups — many of which have been founded by immigrants — are fueling economic growth and a new kind of job creation that is redefining the future of work. Today, 57 million Americans work in this independent economy, and that number is only growing (Upwork and Freelancers Union). It is estimated that contingent workers will exceed 40 percent of the workforce by 2020 (Intuit 2020 Report).
However, we are also seeing many worrying trends indicating that the U.S. is taking our tech and innovation leadership for granted, and startups stand to lose the most. For example, startups accounted for just 8.1 percent of all firms in 2015, down from 13 percent in the early 1980s (U.S. Census Bureau). Twenty years ago, the U.S. share of global venture investment was 90 percent, but that number has dropped precipitously to 81 percent in 2006 and to 53 percent in 2017 (National Venture Capital Association). In the latest Bloomberg Innovation Index released in January, the U.S. slipped from ninth place to 11th. In this era of economic disruption and increased competition abroad, we need to exhaust all available policy options to develop and encourage a new generation of entrepreneurs to step forward and fuel the growth of our economy across the country. To maintain our competitive edge, we need to win the global competition for talent, and the International Entrepreneur Rule is a key policy to help ensure we win the global competition for entrepreneurs.
Another important consideration for the administration as it considers the International Entrepreneur Rule is the changing nature of the startup economy and how it is touching more states and communities than ever before. As TechNet co-founder John Chambers has said, “For many decades, it was often Silicon Valley that fueled our nation’s tech innovation and startup culture. But if the U.S. wants to reclaim its rightful spot on Bloomberg’s List of the Most Innovative Countries, we need to expand the vibrant and dynamic startup culture across all 50 states – to cities like Atlanta, Columbus, and Detroit.” As a recent study by TechNet and the Progressive Policy Institute has shown, there are 25 emerging technology centers in the U.S. that have embraced a startup culture and increasingly have the jobs to show for it. From 2007-2016, the top 25 emerging startup hubs averaged 11.9 percent private sector job growth. By comparison, areas with lower levels of startup activity averaged approximately half that level of job growth. Our study also showed that if policymakers put in place pro-startup policies as part of a larger innovation agenda, we could add one million new jobs to the American economy every year going forward (TechNet and the Progressive Policy Institute). The International Entrepreneur Rule is one of those key pro-growth policies that will enable us to nurture a dynamic 21st century startup culture that reaches every corner of the country and benefits more of our citizens.
Throughout our nation’s history, immigration has been a key ingredient in making the American miracle possible — a story that is as much about the overall economic prosperity we have achieved as a country as it is about the countless individuals who have made a better life for themselves, their families, their neighbors, and their coworkers here. The International Entrepreneur Rule is in line with one of America’s longstanding keys to economic success — the welcoming of immigrant entrepreneurs and innovators to this country and allowing their talents to benefit our economy and U.S.-born workers. One recent study showed that immigrant entrepreneurs “have started more than half (44 of 87) of America’s startup companies that are valued at $1 billion or more” and that immigrant founders have created an average of approximately 760 jobs per company in the U.S. (National Foundation for American Policy). Immigrants and their children have started more than 40 percent of Fortune 500 companies, employing more than 10 million people (Brookings Institution). Immigrants are also more than twice as likely to start a business as native-born citizens (Foundation for Economic Education). One-third of venture-backed U.S. companies that went public between 2006 and 2012 had at least one immigrant founder (National Venture Capital Association).
At TechNet, all of our member companies, without exception, have benefitted by having high-skilled immigrants innovating alongside native-born Americans to create life-changing technologies, millions of jobs, and trillions of dollars worth of economic activity. One of the things we are proudest of is the fact that we represent so many iconic American companies that have been founded or led by immigrants or their children. Furthermore, one primary reason we are excited and optimistic about our nation’s economic future is that we see firsthand within our own membership what a new wave of immigrant and second-generation entrepreneurs are doing at U.S. startups that are growing fast and quickly becoming the rising stars of America’s innovation sector. For example:
- DoorDash: Co-founded and led by Tony Xu, a Chinese-born immigrant, DoorDash is an on-demand delivery technology platform most recently valued at more than $1.4 billion.
- Postmates: Co-founded and led by Bastian Lehmann, a German-born immigrant, Postmates is an on-demand delivery platform that generated $6.6 billion in economic activity across 250 U.S. cities in 2017 alone and helped local businesses sell over $1.2 billion worth of goods in their communities. However, he is far from being the only immigrant powering the company’s economic impact; Postmates is built by and with immigrant communities across the country. Their fleet of over 150,000 couriers helps sustain over 250,000 merchants, among them immigrants of all origins and backgrounds that make our food, craft our arts, and operate the storefronts that animate our neighborhoods. Because of their support, Postmates earned over $217 million in 2017 while creating 5,766 follow-on jobs to the U.S. economy annually.
- Thumbtack: Founded and led by Marco Zappacosta, Thumbtack is an online marketplace for photographers, plumbers, and other contractors. It was most recently valued at $1.3 billion. Although not founded by an immigrant, Thumbtack is a valuable example of the entrepreneurial talent pipeline we can attract through pro-growth and pro-startup immigration policies like the International Entrepreneur Rule. Zappacosta is the son of Italian-born immigrants who came to the U.S. in the 1970s and founded Logitech, a computer peripheral manufacturing company. He is now following in their entrepreneurial footsteps and finding great success as well.
The aforementioned case studies represent only a few examples of the many foreign-born entrepreneur success stories that exist across this country. It is true that while these stories were made possible without the direct benefit of the International Entrepreneur Rule, they underscore the overall positive impact of immigrant entrepreneurs to our startup economy. Together, they offer living proof each day of the benefits to the U.S. economy and American workers of having policies that are welcoming of immigrants generally while strategically seeking out the world’s best, brightest, and most determined entrepreneurs to invest, innovate, and create jobs here. We need policies that help us recruit more entrepreneurial immigrants like these to our shores, and the International Entrepreneur Rule is a key way to do it.
The administration should allow the International Entrepreneur Rule to take full effect and work with Congress and the business community on other ways to modernize our nation’s legal immigration system to ensure the U.S. remains at the forefront of the global innovation economy and that American workers have every opportunity to contribute and share in this prosperity. Attracting the world’s best entrepreneurs is just one part of the broader global competition for talent that is taking place. And competition in this particular area is as fierce as ever. Other countries like Canada, France, and Singapore — to name just a few — have recognized the importance of attracting the world’s best tech talent and created dedicated entrepreneur visas similar to the International Entrepreneur Rule to attract job creators to their shores.
In addition to the International Entrepreneur Rule, we understand the Trump Administration is reconsidering the future of other immigration policies that help promote economic growth and competitiveness, including the H-4 visa program for spouses of high-skilled workers, the H-1B visa program, the STEM OPT extension, and the termination of the Deferred Action for Childhood Arrivals (DACA) program, among others. We are concerned that any eventual termination or disruptions to these programs — as well as the cloud of uncertainty that currently hangs over them, as has been the case with the International Entrepreneur Rule for the past year — will create a perfect storm of economic anxiety that turns entrepreneurs away to our competitors and leads to the loss of talented workers, even more unfilled jobs across the tech sector, stifled innovation, fewer startups, missed investment opportunities, and significant economic costs.
We stand ready to work with you to ensure future changes to our nation’s immigration policies result in positive outcomes for the U.S. economy and American workers.
Thank you for your consideration.
President & CEO
CC: The Honorable Kirstjen M. Nielsen, Secretary, Department of Homeland Security
TechNet is the national, bipartisan network of technology CEOs and senior executives that promotes the growth of the innovation economy by advocating a targeted policy agenda at the federal and 50-state level. TechNet's diverse membership includes dynamic American companies ranging from startups to the most iconic companies on the planet and represents over three million employees and countless customers in the fields of information technology, e-commerce, the sharing and gig economies, advanced energy, cybersecurity, venture capital, and finance. TechNet has offices in Albany, Austin, Boston, Chicago, Olympia, Sacramento, San Francisco, Silicon Valley, Tallahassee, and Washington, D.C.