Via a retweet from Brad Feld, I saw this article.

This is confusing to me.  There is no hard data, but I’d like to explore why are people leaving the US to start companies back in the homeland.

Is it because of:

  1. visa issues
  2. the cost to build a company
  3. the economic opportunity in their home country

If it is the first one, I’m in favor of reform, though I think there are a number of ways to encourage founders to stay, and tying their visa to VC funding, like the startup visa does, doesn’t seem like an optimal strategy.

If it is the second, then we need a cost benefits analysis.  Making it easier to start companies is not an unalloyed good.  For example, I wouldn’t want it to be easier to start a company that made cancer causing products.  It’s harder to start a company in the US because we as a society have made choices that impose costs on companies.  Ask the Chinese how it is to have ineffective regulation.  On the other hand, as outlined in comments here, lowering risk for entrepeneurs (lack of health insurance!) could really lower costs for starting a company.

If it is the last, then, good luck to them.  Who can argue with the fact that Indian engineers are cheaper or that “there are no mature companies, like Google and Microsoft” in these countries?


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