In the tech’s latest hit on President Donald Trump, a group of the industry’s leading investors is suing the administration over its suspension of a policy that would have made it easier for immigrant entrepreneurs to start businesses in the U.S.
By refusing to implement the International Entrepreneur Rule, the administration is blocking promising founders from coming to and saying in the U.S. — a move that is harming the country’s economy and sending jobs overseas, the National Venture Capital Association wrote in a lawsuit filed Tuesday against the Department of Homeland Security.
The Trump administration in July suspended the Obama-era program less than a week before it was slated to go into effect, and said it will propose rescinding the rule altogether. If it had been allowed to roll out, the International Entrepreneur Rule, or IER, would have let immigrant founders stay in the U.S. for up to five years with a startup visa if they showed a plan for expanding their business locally.
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“Immigrant entrepreneurs play a vital role in strengthening the U.S. economy, creating new jobs for Americans and pushing the boundaries of innovation,” NVCA President and CEO Bobby Franklin wrote in a news release. “Rather than throw up roadblocks that prevent them from bringing their talent and ingenuity to our shores, we should welcome them with open arms.”
A third of U.S. venture-backed companies that went public between 2006 and 2012 had at least one immigrant founder, according to a 2013 study by the NVCA. Google, Intel, Tesla and Zipcar all have immigrant founders.
But the U.S. is losing its share of global venture capital investment because of its anti-immigrant stance, the NVCA claims. U.S. startups received more than 90 percent of global venture capital investment two decades ago. That number dropped to 81 percent a decade ago, and to 54 percent last year, according to the NVCA release.
The NVCA claims DHS violated the Administrative Procedure Act because it failed to solicit public comment before suspending the startup visa rule.
Several immigrant tech entrepreneurs have joined in the lawsuit, including brothers Atma and Anand Krishna. The brothers, UK citizens who founded payments platform LotusPay, presented in Mountain View last month as part of prestigious Silicon Valley startup accelerator Y Combinator’s most recent demo day. The brothers are launching their platform in India, and hope to expand it into the U.S. But without the option of a startup visa, Anand Krishna will soon have to leave the country, according to the lawsuit. His brother has already left.
Photo: President Donald Trump listens during a Cabinet meeting, Monday, June 12, 2017, in the Cabinet Room of the White House in Washington. (AP Photo/Andrew Harnik)
Tags: Donald Trump, immigration, Trump