In the competition to ensnare top talent, there is no country in the world that is quite as aggressive as the United States.
In a little-noticed public announcement last week, the US Citizenship and Immigration Services (USCIS) agency proposed a new rule which would allow certain international entrepreneurs to stay back in the US on a temporary basis of up to two years so that they may start or scale their businesses in the country. This visa could be renewed for up to three additional years if the entrepreneur were to demonstrate “a significant public benefit as evidenced by substantial increases in capital investment, revenue or job creation”.
The Obama administration has gone out of its way to create visa-friendly policies that attract smart people to come to the US, and then stay. These build on the natural attraction America offers to foreigners — a welcoming culture, the rule of law, support for a strong capitalist economy and the perception that America stands as the land of opportunity.
Just look at how America plays in the higher education space. The US remains the world’s chosen destination for international students and, last year, according to the Open Doors Report, students from India alone increased by 29.4 per cent to a record high of 132,888. The cream of India’s graduates from the IITs, NITs and top engineering colleges head to US universities each year. The US higher education sector is one of the most vibrant export engines generating $32 billion in annual economic output.
Most governments would be happy to coddle such a sector, but the US government goes a step further by “building” on the natural attraction US universities have for foreign students. Thinking long-term, the USCIS in May published final rules to extend “practical training” permits — work authorisation documents, essentially — to foreign graduates in the Science, Technology, Engineering and Mathematics (STEM) fields to three years.
This means that a student with an advanced degree has three full years to look for a job, find an employer sponsor, and apply to immigrate. If a foreign student is not competent enough to secure such a job despite these generous visa terms, the US is not interested in that person any more. The principle of “survival of the fittest” works well when applied to career-hungry foreigners.
The new entrepreneur
The kind of blatant talent poaching brought about by the new entrepreneur visa is unparalleled. It is aimed at a class of risk-taking, creative, and hardworking individuals around the world who may just not be willing to go to the US using traditional routes, such as an employee of a company, a student or as a spouse. What entrepreneurs prize most is access to capital, talent, and a market with strong protection of intellectual property rights. America already has all of these “natural traits” as its venture capitalists spawn new Unicorns — start-ups with billion-dollar valuations — every year. Of the top 20 Unicorns as listed by Fortune , 11 are American, including such household names as Uber, Airbnb, Snapchat, SpaceX, Pinterest, Dropbox and Lyft.
If you thought you could approach the US consulate tomorrow to seek this visa because you have a business idea in mind, you may want to pause. This visa is specifically targeted at people who are already successful as entrepreneurs, and who are already in the US facing a forced return to their home countries because their visas — business or student — are about to expire soon. If you are someone who has at least a 15 per cent ownership in a venture that has received a minimum of $345,000 in capital from certain qualified US investors with established records of successful investments, you could qualify. It helps if the start-up was formed in the US within the past three years.
Too little too late?
The US, among the wealthiest countries in the world, has been aggressive not just in attracting STEM talent, it also loves foreign investment. As early as 1990, the US created the EB-5 visa, which allowed foreign investors to acquire a green card with as little as $500,000 if the funds were invested in a business that is shown to create jobs for US workers. India, trying to compete with the US here, is sadly a day too late and a dollar too short. The Modi government announced last week its investor visa policy wherein foreign residents need to invest a whopping ₹10 crore (nearly $1.5 million) for the privilege of living in India as permanent residents.
According to the Organisation for Economic Cooperation and Development (OECD), America ranks 29th in math literacy and 22nd in science. The race to trap the world’s best and brightest has been the western world’s answer to address the relatively weak K-12 education system that does not produce strong domestic graduates. The entrepreneur visa is the latest such attempt, one that is bound to be enormously successful for the US. And because transfer of human talent is a zero sum game, this attempt is bound to be extraordinarily expensive to the source country.