New York Times: “U.S. Technology Startups Panic Over Immigration Ban”

Silicon Valley technology start-ups and businesses, many with immigrant founders and a diverse workforce, are reacting strongly against President Trump’s executive order banning travel for nationals of certain Muslim-majority countries. President Trump’s executive order, issued late last month, halted the US refugee program for 120-days, barred Syrian refugees indefinitely, and imposed a ninety-day travel suspension on individuals from seven predominantly Muslim countries, including Iran, Iraq, Libya, Somalia, Sudan, Syria, and Yemen. The ban, which was temporarily halted on Friday by a Seattle judge, has led to widespread protests and legal challenges, and many venture capitalists and start-up founders are reporting it’s already impacted key business decisions and employee operations. "I've never seen something impact the day-to-day thought process of CEOs so fast,” Neeraj Agrawal, general partner at Battery Ventures, tells the New York Times.

"Here and now, today, we have businesses that are stopping because their employees can't travel in and out of the United States," David Cowan, a partner at Silicon Valley firm Bessemer Venture Partners, says. "This will be the No.1 cause of missed business plans in 2017." Cowan, who also sits on the board of a cybersecurity company in Israel, says the company has delayed moving its headquarters to the US because its employees are "from all sorts of countries.” Other companies have also reported delaying plans to open up US locations. Amin Shokrollahi, founder and chief executive of Kandou, a semiconductor company, is reconsidering plans to open a US design center that would have employed at least twenty people. The Iranian-German dual citizen is based in Switzerland, and he and his Iranian colleagues canceled plans to attend a trade show in Silicon Valley, where he was supposed to have received an award. 

The employee base of many Silicon Valley companies is especially diverse. More than half of all "unicorns"—startups valued at $1 billion or more—have at least one immigrant founder, according to a 2016 study by the National Foundation for American Policy, a non-partisan think tank based in Arlington, Virginia. "There is a panic in the startup community," Bill Stock, president of the American Immigration Lawyers Association (AILA), tells the New York Times. "Startups are very concerned because of the unpredictability of the order."

The opposition to the travel ban is so strong that nearly 130 companies, many of them in the technology field, filed an amicus brief late Sunday in the US Court of Appeals for the Ninth Circuit, which declined to reinstate the travel ban after it had been blocked. The brief was signed by large and small tech companies including Apple, Facebook, Microsoft, Google, Uber, Tesla, and Intel and says that the “instability and uncertainty” created by the executive order “will make it far more difficult and expensive for US companies to hire some of the world’s best talent—and impede them from competing in the global marketplace.” President Trump says the ban is necessary to protect Americans, objecting to the judicial ruling that blocked his ban: "The judge opens our country to potential terrorists and others that do not have our best interests at heart. Bad people are very happy!"

While many technology companies have been outspoken in their protest of the ban, other companies are keeping quiet. Fortune Magazine contacted nearly every company in the Fortune 100 for a response to the Muslim ban, and the “responses were almost uniformly no-comments or punts, with spokespeople explaining executives were still assessing the impacts of the ban.”

USCIS Proposes Rule to Welcome International Entrepreneurs

The United States has long been the land of opportunity and that has been particularly true for the world’s brightest business minds. Indeed, studies show that “more than 40 percent of Fortune 500 companies were founded by immigrants or the children of immigrants.” Entrepreneurs may not fit easily in nonimmigrant visa categories, but there may be a better option soon. Last week, US Citizenship & Immigration Services (USCIS) announced a new  International Entrepreneur Rule, “which would allow certain international entrepreneurs to be considered for parole (temporary permission to be in the United States)” in order to start or scale a business in the US. The rule has been sent to the Federal Register, and once posted, the public will have forty-five days to submit comments. “America’s economy has long benefited from the contributions of immigrant entrepreneurs, from Main Street to Silicon Valley,” USCIS Director León Rodríguez says in the announcement. “This proposed rule, when finalized, will help our economy grow by expanding immigration options for foreign entrepreneurs who meet certain criteria for creating jobs, attracting investment and generating revenue in the U.S.”

The Department of Homeland Security (DHS), pursuant to Section 212(d)(5) of the Immigration and Nationality Act (INA), 8 U.S.C. 1182(d)(5), has the authority to parole individuals in the United States “on a case-by-case basis, for urgent humanitarian reasons or significant public benefit.” In its new rule, USCIS proposes to “amend its regulations implementing this authority to increase and enhance entrepreneurship, innovation, and job creation in the United States.” The proposed International Entrepreneur Rule would grant parole to entrepreneurs with “startup entities 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.” The parole would first be granted for a period of two years and a subsequent re-parole may be granted for an additional three years, only if “the entrepreneur and the startup entity continue to provide a significant public benefit as evidenced by substantial increases in capital investment, revenue or job creation.”  Eligible entrepreneurs include those:

• Who have a significant ownership interest in the startup (at least fifteen percent) and have an active and central role to its operations;
• Whose startup was formed in the United States within the past three years; and
• Whose startup has substantial and demonstrated potential for rapid business growth and job creation, as evidenced by:

1. Receiving significant investment of capital (at least $345,000) from certain qualified US investors with established records of successful investments;
2. Receiving significant awards or grants (at least $100,000) from certain federal, state or local government entities; or
3. 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.

While he may be leaving office soon, President Obama has long been an advocate for bringing entrepreneurs around the world to the US. In 2012, he launched Entrepreneur Pathways, a website aimed at assisting immigrant entrepreneurs in their goal of building new businesses in the US. This new International Entrepreneurs Rule would continue President Obama’s mission in bringing the best and brightest to the US and creating new jobs for Americans.