The Startup Visa movement showed a lot of momentum yesterday, actually trending into the top 5 on Twitter. As an entrepreneur who is working on my own startup, I’ve had the chance to meet a lot of other entrepreneurs, and I am happy with the vast support in the entrepreneur community for the Startup Visa.
Recently, I was asked, as an entrepreneur, if I was worried about competition for the already tight venture capital market, and if Startup Visa would just exacerbate that problem and make it harder to get funded. And the simple and direct answer is “no” and here’s why.
1. Money follows success, and the more success stories there are in a particular vertical, the more money is available in that vertical. Naturally, not every entrepreneur is successful, and not every investment yields a ‘pop.’ But as a law of averages, the more entrepreneurial ventures that are started, the higher the likelihood that a sector will reach a “critical mass” of successes to build upon. Successes essentially “loosen the purse strings” by showing a value proposition that is hard to pass up.
2. Most of the working age population doesn’t meet the risk profile of an entrepreneur. If you are in my demography, and in my industry, you probably rode the success of the internet boom right into a mortgage, kids, and car payment. With those liabilities, it’s hard to take on the initial risk of starting up. Your risk vs. value proposition is probably different than it was 10 years ago.
Imagine looking at your kids saying, “this college fund money I’m spending right now is going to come back big, trust me.” The number of people in that age/risk profile is lower than it was in the late 1990’s because we had a about a 5 year drought of people entering the fields that are good technologies for startup companies. In summary, We simply need more people who fit the risk profile of an entrepreneur to jump start the employment engine that is small business.
3. Ideas, Ideas, Ideas. As a business environment, we are an enthusiastic and optimistic group of risk takers. An idea that is born in an environment like that has the utmost chance of success. More Ideas + (Risk, Optimism,Effort) = More Successes. A strong proliferation of ideas and perspectives can be gained by enhancing the diversity of any community. If we do that in the entrepreneurial community, we enhance the successes mentioned in 1 above.
4. Global Perspectives are a key success factor in the current economy. As other markets start to mature and as global consumption of products outpaces domestic consumption, ideas of how to best leverage the success in those markets is going to come through outside perspectives. Having the ability to collaborate with entrepreneurs that have experience in those markets one of the things I have really enjoyed my current effort. And I would really like to enhance that footprint in the community around me.
5. The best thing about a vibrant startup community, is that those who succeed and those who don’t unfortunately don’t reach an equilibrium. I saw this in the incubator environments of the late 90’s. The company at one end of the hall goes down, the company at the other end of the hall gets funded, and guess who is first in line to help the funded company. This is how the startup community becomes self sustaining by essentially self-mitigating startup risk. I really enjoyed this “go big” aspect of the startup community at that time. Startup Visa grows the number of entrepreneurs in the ecosystem, and this too is a critical mass issue to attain startup symbiosis.
There are many other reasons to support this movement, these are just my top five. Don’t let the FUD of a new approach to jump starting small business keep you on the sidelines. Please visit http://startupvisa.2gov.org and write your representative to support the StartupVisa. It only takes 2 minutes.
" a mortgage, kids, and car payment. With those liabilities, it’s hard to take on the initial risk of starting up. Your risk vs. value proposition is probably different than it was 10 years ago.
Imagine looking at your kids saying, “this college fund money I’m spending right now is going to come back big, trust me.”"
Are you trying to make me feel bad?
Nice post.
Toby, thanks! I am living that out right now as well:-).
this is typical government run amok. There is already a program that would allow most of what this bill is trying to do. Let's not fix that one and instead create a whole new duplicative program. This does not mean I am against the idea. It means I am against creating a new government program (and bureaucracy) when it can be done by tweaking something that already exists.
What program are you referring to Rick?
Mark,
The EB category of citizenship stands for Employment Based. The original program started with EB-1, EB-2, EB-3, EB-4. All of these are an individual investment in starting or growing a business. The EB-5 program was put in place some years after the first four categories. The EB-1 is an immigrant investing in starting his own business. Some tweaking o this program would do exactly what is being proposed as I read it.