States have long courted international entrepreneurs in an effort to attract investment and capital to their countries. However, existing immigration legislation is poorly equipped for evaluating today's digital companies. Startup visa policies were developed in an effort to meet the needs to tech founders who wish to bring their companies to new markets. However, they often remain ill-suited for digital startups, and the impact thus far has been limited. While these visa programs aim to lower the barriers of entry for today’s technical entrepreneurs, new innovations in the evaluation process have created additional hurdles that have impacted success. A growing private role in the evaluation of these visa applications has created a new and unique challenge for prospective entrants, while fundamentally changing the way that immigrant visas are granted.

1. Presented at the Law and Society Association Conference
June 22, 2017, Mexico City
Natalie Novick
Center for Comparative Immigration Studies
University of California-San Diego
The “Startup Visa” an Innovation in Immigration
Policy for the Digital Age

2. “I want France to be a startup nation. A nation that thinks and moves like a
startup. Entrepreneur is the new France…” Emmanuel Macron announcing
France’s new Startup Visa at the VivaTech Conference in Paris, June 15, 2017

3. Technological change has paved the way
for new forms of entrepreneurship
 2002 -- the Wireless Application Protocol (WAP 2.0) created
new opportunities for third party developers to build products
for devices operating over wireless networks
 2008 -- Apple’s app store launches creating a new market for
third party apps. Google’s Android market launches in early
2009, Windows market in 2010.
 2018 – Digital marketing economy forecasted to exceed $252
billion worldwide (Statista 2015)
 2020 -- The global app economy is forecasted to exceed $101
billion worldwide (App Annie 2016)
 New opportunities made available by technology have
changed how (and where) entrepreneurs do business

4. Startup visas can take advantage of
the growth in the digital economy by
encouraging highly skilled,
entrepreneurs to cross borders

5. Foreign entrepreneurs have long
been a priority for states
 Migrants launch 25% of new businesses in the US, and over
50% in Silicon Valley (Wadhwa 2007, EU Action Plan)
 Immigrants have higher entrepreneurial rates than natives
(Acs 2011, Hunt 2009)
 Migrant entrepreneurs open countries to new markets,
products, ways of thinking– promoting local innovation
 In Europe, migrant entrepreneur rates are limited due to
 legal difficulties;
 limited labour market and career opportunities;
 lack of information, knowledge and language skills.

6. However, existing immigrant
investment/business creation
immigration policies are inhibiting to
startups with low profitability and
capital assets.

7. What is a startup visa?
 Countries have long maintained policies to permit the
entry of entrepreneur investors to help support
economic and labor development
 Startup visas are largely attributed to Chile in 2000.
 Since then other countries have followed suit, many
more unsuccessfully (the US is a prime example)
 Differs from existing entrepreneur investor visa types
as it is directed for firms in early stages (startup
implies scale up)
 Often directed at tech-oriented firms, but not always
 Residency rights in exchange for expected economic
benefits

8. Challenges of porting a digital
company across geographic borders
 Despite the growth of the digital economy and the
increasing portability of firms across borders, starting
up abroad is not always an easy prospect
 Startups are by nature risky enterprises some put
failure at over 90% (its actually more nuanced by
industry)
 Startups tend to do better in environments where
entrepreneurs can draw on personal networks and
local knowledge. Startups are more likely to fail
outside their home market (Dahl and Sorenson 2012).

9. Startup Visas becoming more
numerous over time
• Singapore (Entre Pass)2009
• Chile2010
• UK (Tier 1 Entrepreneur)2011
• Ireland, Australia2012
• Spain (Ley de Emprendedores),
Canada, Korea
2013
• New Zealand, Italy2014
• Denmark, Netherlands, France
Tech ticket
2015
• Immigrant parole (USA)2016
• France Tech Visa, Canada (Launch Academy),
Estonia, Lithuania, Latvia, Cyprus2017

10. Policies define startups differently
 Denmark: Startups are innovative, scalable and,
ideally, tech-driven businesses with a clear growth
potential.
 The Netherlands: company has a product or service is
new to the Netherlands or utilizes a new technology
or technique for production, distribution or marketing
 Ireland: “Startups must introduce a new or innovative
product or service to international markets.”
 Capable of creating 10 jobs in Ireland and realizing €1
million in sales within three to four years of starting up.

11. Policies define startups differently
 Italy: must be engaged solely or primarily in
technological innovation
 Less than 4 years old
 Meet at least one of the following additional criteria:
 devote at least 15% of its expenditure to Research and
Development (R&D);
 have at least one third of its team composed of PhD
students or graduates, or of personnel who have been
working in research for at least 3 years; alternatively, at
least two thirds should hold a master’s degree;
 be the owner, filer or licensee of a patent

12. Three Different Policy Types
The policies differ with regards to entry level criteria, the
application process, and what entrepreneurs receive for
taking part
 Entry Investor: Follows previous investor visa schemes,
tailored to fit startups by lowering thresholds for entry,
require own support funds
 Hybrid: Pairs similar investor criteria for entry with
vetting by in-country private enterprise (either
accelerator or incubator), require support from self/3rd
party
 Incubator: entrepreneurs receive in-country support,
such as startup funding, mentoring, assistance with legal
requirements

13. Startup Visa Policy Types
Entry Investor Hybrid Incubator
Application
procedure
Initial application is made to immigration and business authority.
Each is individually evaluated according to certain provisions, that
may include minimum investment amounts, human capital skills,
and business plan strength.
Sponsorship by a
private party
no
Private enterprise such as an incubator may
sponsor and evaluate petition, provide
mentoring support
State-sponsored
business support?
no yes
Example
Denmark (2014),
Ireland (2012), Spain
(2013), UK (2011),
New Zealand (2014),
Australia (2012)
Italy (2014), the
Netherlands (2015)
Canada (2013),
France (2017)
France (tech ticket
2015); Chile (2010);
Canada (launch
academy 2017)

14. Selected Policy Outcomes
Data Period
Amount of
Applicants
Amount
Approved
Acceptance
Rate
Home
Countries
Benefits
Entry-
Investor
Denmark
Jan 1, 2015 -
April 1, 2016
285 66 23% 40 Residence and work
permit for 2 years with
possibility of extension
Ireland
April 1, 2012
- March 2014
35 20 57% ---
Hybrid
Italy
Jun 24, 2014
- Dec 31,
2015
61 40 66% 18 Residence and work
permit for 1 year with
possibility of extensionthe
Netherlands
Jan 1, 2015 -
Dec 31, 2015
95 21 22% 25
Incubator France
Jan 1, 2015 -
Dec 31, 2015
1377 50 4% 100
Startup funds of €12,500
- €25,000, 1 year
residence permit with
possibility of extension,
mentoring, office space,
help desk personnel to
deal with contingencies

15. Who applies for a startup visa?
Examples from Startup Italia, 222 applicants total, 134 positively evaluated:
Demographics Mean age: 36.2; Male: 146; Female 66
Work
experience
105 applicants had previous experience in entrepreneurship (self-
employment); 103 of them were employees.
Professional
background
The most common professional backgrounds are IT and marketing,
followed by management and engineering.
Education
83 applicants hold a Bachelor’s degree; 63 hold a Master’s degree (or
equivalent); 9 have a PhD, 26 post-graduate qualifications (e.g. MBAs).
Course of
study
The most common educational backgrounds are Computer Science,
Marketing, Business Management, Design and Engineering.
http://www.sviluppoeconomico.gov.it/images/stories
/documenti/italia_startup_visa_1_quarterly_report_
2017.pdf

16. Initial reflections
 Ceiling caps on the amount of prospective
entrepreneurs to come in to the country limit the
impact of these policies (50 maximum in Denmark,
200 in France in 2015)
 Strict evaluation criteria (the Netherlands, Denmark)
further diminish the impact of policies
 High capital requirements (€50.000 minimum
investment in Ireland and Italy) are associated with
fewer applications
 French “incubator model” garners the greatest
international interest and gives startups the best
opportunity to succeed

17. Initial reflections
 Today’s startup culture aims to disrupt existing
industries and markets. Immigration barriers is one of
them, leaving prospective entrepreneurs looking for
alternatives.
 Overly technocratic processes such as requiring a
business plan (Denmark, Ireland, etc.) are antiquated
thinking when products and market fit are evolving
constantly
 New innovations such as France’s new entrepreneur
visa, and the Estonian startup visa provide more
flexible terms for international entrepreneurs. This
visa model continues to evolve

18. Are startup visas a golden ticket for
states?
 Evidence from Italy and Denmark shows that once
entrepreneurs enter the country, business
development is slow
 Incubator or Hybrid policies may help support greater
business creation and success by providing in country
networks
 There is a general lack of transparency about the
evaluation process and successful firms across all
policy models. Greater transparency and visibility of
these programs may encourage more applications

19. Where things go from here
 Challenges remain for states in evaluating startup
companies for residency purposes
 Accelerator/incubator support is uneven
 An alternative: Estonia’s e-Residency (in 16 months,
485 new companies and 9,853 new “residents”)
 Individuals and organizations often “hack” existing
immigration policy for self employment purposes
(example, US H-1B Global EIR initiative). The European
Commission especially identifies the EU Blue Card
directive as a way to promote greater migrant
entrepreneurship