Startups often face challenges when it comes to hiring foreign talent due to the restrictions and limitations of the H-1B visa. Founders have had concerns about giving up control and equity when transferring their H-1B to a startup. However, a new proposed rule by the U.S. Department of Homeland Security (DHS) aims to address these issues and provide more flexibility for startup founders.
Key Takeaway
The proposed rule by the U.S. Department of Homeland Security aims to eliminate the downsides of the H-1B visa for startup founders, including giving up control and equity. The rule recognizes the potential benefits of allowing entrepreneurs to develop their business enterprises and is currently accepting public comments until December 22, 2023. Founders now have the opportunity to retain control and equity in their startups, providing them with more freedom to grow and make decisions regarding the direction of their businesses.
A Change in the Game
The proposed rule, published by DHS in October, acknowledges the potential benefits of allowing more entrepreneurs to obtain H-1B status to develop their business enterprises. It recognizes that this could lead to job creation, the growth of new industries, and the creation of new opportunities in the United States.
In the past, founders looking to transfer their H-1B to a startup had to navigate the challenge of giving up control and equity. However, the new rule seeks to eliminate these downsides and provide founders with more freedom to grow their startups without limitations.
Making Your Voice Heard
The DHS is currently accepting public comments on the proposed rule until December 22, 2023. This is an opportunity for entrepreneurs and business owners to voice their opinions and provide feedback on the rule. It is essential to participate in this process and make your voice heard, as the comments received can potentially influence changes to the rule before it is finalized.
If you wish to submit a comment, you can do so at the top of the proposed rule by selecting the “SUBMIT A FORMAL COMMENT” link. The comments must be in English, but you have the option to comment anonymously if you prefer.
Retaining Control and Equity
Under the current system, an employer sponsor is required to file an H-1B petition on behalf of an employee. Self-sponsorship is not available for work visas, meaning that founders must depend on their employer to secure their visa status.
The new proposed rule offers founders more flexibility by removing the need to reduce their majority stake in their startup. It allows them to retain control and equity as they build and grow their company. This change provides founders with increased autonomy and the ability to make critical decisions regarding the direction of their business.
