The GEN Atlas Policy Deep Dive explores several examples of the same policy introduced in different countries. By drawing out the subtle variations in approach and highlighting innovative ideas, we hope to learn more about the most effective approaches to policy making and offer a roadmap for other policymakers to learn from. Our analysis of startup support policy is built around eight overarching themes:
- Finance: New types of capital for startups and scaleups at the right time
- Education + Skills: Embedding enterprise and entrepreneurship into education and providing (both existing and potential) entrepreneurs with mentoring, training and support
- Market Access: Expanding access to markets for startups domestically and abroad
- Inclusivity + Culture: Ensuring that entrepreneurship is a culturally attractive vocation for all sections of society and in particular that people from disadvantaged groups have an equal opportunity to launch and grow a business
- Regulation: Removing regulatory barriers to innovation and startup success
- Ecosystem + Economic Development: Developing and managing local ecosystems to better support entrepreneurs, startups and scale-ups
- Science, Technology and Innovation: Utilizing the latest advancements in science and technology to improve productivity, boost economic growth and solve societal problems through innovation
- Policy Making: Maintaining a data-driven, effective and coherent policy making process that supports entrepreneurs and ensures public awareness of available programs
Attracting talented entrepreneurs and ready-made startups to participate in your local economy is perceived to be one of the most effective ways for ecosystems to grow yet national boundaries and visa restrictions create significant barriers to entry. Startup Visas aim to tackle this problem by giving skilled immigrants the right to launch or relocate their business in a foreign jurisdiction.
For a full list of Visas aimed at entrepreneurs, you can explore the GEN Entrepreneur Visas Directory. The directory draws a distinction between Entrepreneur Visas which are aimed at potential founders and Startup Visas that seek startup relocations, however, it is worth noting that the Atlas Compendium considers them part of the same mechanism as they seek to address identical challenges.
Increasing market access
Even in the modern era of globalized economies, government rules and national boundaries still serve as substantial barriers to both startups looking to expand overseas and international investors looking for sound projects to get behind. Policies that fall under the “Market Access” theme seek to expand access to both international and domestic markets for startups and investors alike. In particular visas are seen by policymakers as an effective mechanism to drive up productivity and employment by allowing external startups access to their market and therefore increasing the total number and concentration of innovative and high-impact businesses operating in their ecosystem.
Amongst the 100+ new and updated policy case studies recently published on GEN Atlas, there are 8 Entrepreneur Visas featured including those from Canada, Italy, Netherlands, Denmark, France, New Zealand, Argentina and Fukuoka City.
One challenge for policymakers is that competition to attract the most talented entrepreneurs is fierce and only growing stronger as different ecosystems compete for a small talent pool with tailored offers. We have compared the 8 Atlas featured case studies and found five main variables that distinguish the schemes from one another:
Visa duration
One fundamental feature of a visa that determines the attractiveness of the scheme is how long the visa lasts for and what paths it creates for permanent residency. In particular the Dutch visa has been criticized for only offering successful applicants 12 months to establish their business. By contrast New Zealand offers 3 years and Canada offers 2 years but with the added guarantee of permanent residence when the time period is complete.
Visa caps
Some visa schemes are also severely hamstrung by limits placed on the number of successful applicants. For example, the Danish scheme allows only 75 visas to be granted per year compared to 400 in New Zealand, and 1000 in Canada. Some programs such as La French Tech Initiative place no overall restrictions on the number of successful applicants, instead allowing the selection criteria to filter applicants alone.
Eligibility criteria
There is considerable variation in how much funds the entrepreneurs applying for the visas are required to possess, ranging from below $10k in Canada to $45 for the Fukuoka City Startup Visa. Some schemes go further in requiring proof of language proficiency and education levels of the applicants as is the case in Argentina and Canada.
Selection process
The fourth variable relates to the challenge of spotting talent. The vast majority of visa schemes rely on a selection process within government to do this, however, there are a couple of exceptions. In particular, Canada’s Startup Visa completely outsources the selection process to ecosystem actors (including venture capital funds; angel investor groups; and incubators). Other schemes such as in the Netherlands have a hybrid approach where applicants must receive sponsorship from an approved facilitator but the government still has final say through an innovativeness assessment. However, it is worth noting that there have been challenges to this approach with the Canadian scheme being criticized for an excessive backlog of applications.
Parallel support programs
Finally, several programs offer support packages to successful applicants. Most notably, the Global Impact Visa in New Zealand is tied to the Edmund Hillary Fellowship which provides participants several benefits including: training programs; investment opportunities; access to talent; and access to a network of local and global investors, advisors, partners and mentors. Additionally, programs like La French Tech, the Fukuoka City Startup Visa and Argentinian Startup & Talent Visa also offer access to funding streams, favorable regulation and startup support programs.
What makes the most effective Visa?
This is the question that has been addressed by The Entrepreneurs Network (TEN) in their recent report which outlines a blueprint for the world’s most pro-innovation visa systems. The report offers a series of recommendations for policymakers looking to design a world beating entrepreneur visa including the following:
- Governments should proactively identify foreign entrepreneurs and offer them fast-track visa status to expand their startups
- There should be no caps on the number of entrepreneurs able to apply for a visa
- The visa should last long enough for holders to have stability whilst they build their business
- Other forms of visas should include pathways for potential entrepreneurs to quit their sponsored jobs and launch new businesses
- Entrepreneur visa holders should be offered access to office space, training and mentorship programs
- Governments should consider training talented individuals in global business schools before the immigration process begins
- Competitions that award visas can create a meritocratic system to identify potential entrepreneurs.
What impact have Startup Visas had?
Despite a widely held belief amongst policymakers that Startup Visas are an effective tool to deliver increases in productivity and growth, the vast majority of the schemes featured in Atlas have not produced detailed impact assessments for the schemes. Using GEN’s rating system for evidence level, we see that Canada, Italy, Denmark, and the Netherlands reach only Level 1 by providing statistics on the number of applications and visas granted but little else.
La French Tech goes further by demonstrating the direct impact (level 4) of the program on startups launched, jobs created, and funding raised. Likewise New Zealand’s Global Impact Visa published an impact report that cites the economic impact visa holders have had on job creation, business creation, and investment. By contrast, the programs from Argentina and Fukuoka City have provided no evidence at all.
While Startup Visas remain a popular – and in our view essential – tool to boost innovation and grow ecosystems, it is clear that much more can be done by policymakers to demonstrate the full impact visas are having when held against the ambitious objectives of the policy.