Friday Letter: How the US is losing out over its immigration policy

Immigration reform is not the most talked about issue in venture, but it could provide a huge lift to the economy and the future of the industry.

Six weeks ago, I wrote, dear reader, that we should keep an eye on immigration reform.

Shortly after a hearing on July 13 by the House Judiciary Subcommittee on Immigration and Citizenship called “Oh Canada!,” congresswoman Zoe Lofgren of California introduced a Startup Visa bill, as predicted, on July 26.

HR 4681, or the Let Immigrants Kickstart Employment (LIKE) Act, aims to encourage immigrant founders to develop their venture-backed start-ups in the US. Part of the bill will create a temporary visa for start-up founders and offer a path to permanent residency “if the start-up entity meets certain growth-related benchmarks.”

There are a lot of issues impacting venture right now. And based on my recent conversations with many of you in the venture community, most investors are more concerned about a frothy environment for over-valued deals or how the venture firm fundraising market continues to peak. Immigration often takes a back seat to these more high-profile talking points.

But immigration reform – or the ability of investors to fund talented entrepreneurs in the US – is one of those under-the-radar kind of issues that more in the venture community should pay attention to.

On Monday, we posted a story by Venture Capital Journal reporter Emilia David on how VC-backed start-ups are hindered by immigration obstacles. Featuring comments by Jeff Clavier of Uncork Capital, Manan Mehta of Unshackled Ventures and a pair of immigration lawyers, the article reports on how outdated government policies are holding back foreign-born entrepreneurs. You can read the story here.

Last month, before Lofgren introduced the LIKE Act, I spoke with Michael Brown, the long-time general partner with Battery Ventures, who this summer was elected as chair of the National Venture Capital Association. He noted that the NVCA has worked on immigration reform for more than a decade.

“The US used to be the only place for foreign-born citizens to come and get educated, raise capital, start a business and pursue the American dream,” Brown told me. “But we find ourselves now in a competitive world. Entrepreneurs can more easily start their businesses and do all that elsewhere. The US is losing steam.”

But it doesn’t have to.

Let me know what you think. You can hit me up at agoldfisher@buyoutsinsider.com.