The US Startup Visa: A boon for dismayed, frustrated British entrepreneurs

I’ve been reading a lot about the proposed US Startup Visa.

Right now, one of the biggest things that prevents smart entrepreneurs (British or otherwise) from going to live and work in Silicon Valley, is the Visa issue. Sure, most nationalities can get 3 months worth of time in the States, but after that, they need to leave and come back again… and thus begins the dance with the immigration chaps at San Francisco International Airport.

This is the comfort blanket that most British entrepreneurs cling to.

It stops them actually doing anything.

Instead they arse about in the UK dealing with total numbskull venture capitalists — most of whom are playing the role admirably up until it comes to coughing up cash. It is all about risk, as John Malloy from Blue Run Ventures pointed out in a recent interview we did.

In Silicon Valley, they get risk.

Your brilliant, amazing, its-gotta-work idea is risky. Anything new is inherently risky. But in America, you try it. You mitigate as much risk as you can then you try it. You get stuck in and you see what happens.

In the UK, entrepreneurs try too. The first thing that happens is they become social outcasts. They’re labeled, with a bit of a laugh, ‘delboys’. But those doing the labelling do actually mean it. And this is the horrifying thing in the UK — normal people do quite like to thwart the efforts of anyone thinking outside the box. There are two fundamental points about the British culture contributing to this:

1. British people are inherently jealous of any success whatsoever. I often joke, ‘that shouldn’t be allowed‘, when I hear someone has made a pile of cash. I am being ironic, but it’s fascinating to watch the number of people who actually nod along with the statement.

2. Know your place. British people need to ‘place’ you in society. They need to understand where precisely you are in the hierarchy. And if you’re seeking to change that hierarchy — by doing something entrepreneurial, well, that’s your fault. See point 1.

Executives in big UK companies are super examples of this. Whilst they’re earning — for example — £200k a year, they will do their utmost to be suspicious of startups. What’s particularly annoying for these executives is discovering that the startup founders were middle managers — subservient to him — prior to starting their company. And, with just a signature, this executive could ‘make’ the startup company by granting them a stupendous contract.

What typically happens in most deals is that British businessmen (and women) will evaluate whether or not they’d like to see the other person be successful. The answer is resolutely ‘no’. Therefore all sorts of difficult questions ensue — how are you backed, what happens if, I’m concerned about the risk… all the sorts of questions that are never asked of bigger, more established companies. Because of course, you’re never actually dealing with the founders of big companies. So you never have to deal with the jealousy issue.

This is a critical reason why most tech startups in the UK go absolutely nowhere. You can’t legislate against it. It’s built straight into the culture.

Which is why the cleverest escape.

The biggest misjudgement I ever made was staying in the UK throughout my twenties and not moving to Silicon Valley. Instead I fought tooth and nail against the establishment. By hook or by crook, I managed to get my ideas out the door. I paid for it. I mean, I literally had to fund it all, with the exception of the initial capital. Which came from… you guessed… America! Or, An American venture capitalist. Once, I managed to secure a small amount of investment from a thoroughly understanding angel investor. Once. Those people are unfortunately few and far between in the United Kingdom. Although I worked with smart Americans all the time, I failed to recognise reality: If you’re starting a new tech business, the only place — the ONLY place — you should be is Silicon Valley.

The amount of times I have been nailed to the wall by insanely jealous British executives is simply ridiculous. Any business concept I’ve had — it’s typically gone nowhere because when I try and pitch it to the Brits, in order that someone actually pay for it, the answer is invariably no, no and thrice no. Until some bright spark starts the business in the States, gets a good bit of venture capital and… ‘momentum’. Then I have had to watch with familiar dismay as that same executive gets on a plane and flies out to do business with them.

Which is why you find me in San Francisco every two weeks. Well, I was there more or less every two weeks last year. There’s a baby on the way here so I’ve had to change my priorities slightly. It’s a surreal experience, going from the British boardroom to the American boardroom.

Can’t-do becomes Can-do. The word ‘yes’ is used a lot more. There is no immediate feeling of jealousy. Instead, there’s excitement.

Sit down with a Bank Manager in Silicon Valley and they will — genuinely — treat you as though you’re serious. As though you could well become the next Bill Gates. Talk to your accountant and they’ll do the same. They’ll make sure you’re setup in a tax efficient manner so that when you get ‘your first round’, it’ll be easy to grow the company. You’ll fall off your chair when the chap picks up the phone and calls his friend (“he’s usually good for $20-30k and he loves mobile stuff”). You’ll start having heart palpitations when your accountant puts the phone to his chest and asks, “Can you do a drink with him tonight?”

They move fast, they move seriously, they move with passion and excitement. It’s everything you’ve experienced in the UK, but inverted.

By the way, for the Americans reading — and for the British reading who don’t quite get the ‘jealousy’ thing that I’m talking about, here’s a good example: This is a Bugatti Veyron in Manchester (via Autoblog).

That is a traffic warden putting a parking ticket on the Bugatti. That is also a crowd cheering on the traffic warden. Why? Well it’s because each of the people watching will never, ever, ever have the capacity to even think about buying an £800,000 Bugatti. They know it. They know their place. Why should someone else be allowed to be successful enough to blow almost a million quid on a car? Yeah. Fluck’em! Rich B’stards!

Alas, this is generally the attitude found in the UK. It doesn’t really matter out on the streets. But when you’re trying to get a contract or trying to get a company to buy your new service — 9 times out of 10 — you’ll have to deal with a middle manager who would have been stood right at the front of that crowd above, jeering. They can’t be arsed to think outside the box. They can’t be arsed to startup their own business. And they’ll sure as hell lord it over you and, if at all possible, not give you the deal. Or they will give you the deal, but on punitive, ridiculous terms.

1 out of 10 business people get it. These are the chaps who contact you, get you in for a meeting and then award you the deal there and then. These are the people who understand entrepreuenrs — they’re the ones who will actually add a zero on to your cheap-as-chips pricing, commenting, “I actually need you to stay in business, ok? And we can afford this. We need good service.”

It doesn’t happen very often at all, unfortunately. It’s why you’ll have seen one or two British tech startups succeed. At some point, they got a 1-in-10 person at one of their clients and managed to establish themselves and hire some staff. In the UK you need a lot of middle managers so that they can do business with the other middle managers at your prospective clients. Middle managers cannot stand the smell of a successful entrepreneur, especially if, last year, that entrepreneur was doing their job.

Of course, after reading this, most British entrepreneurs still won’t get it. I speak to British mobile and tech entrepreneurs all the time. They simply don’t believe what I say about Silicon Valley. Some do believe, but — well, it’s all too easy to sit in the UK and spunk the little money they do have up the wall.

Most of them invest in hope.

But there’s a looming problem for these entrepreneurs. This rumoured ‘StartUp Visa Act’ that the Americans are discussing would completely and utterly destroy any barriers for the poor British entrepreneur. So explains BusinessWeek:

The StartUp Visa Act would create a new type of two-year visa, called an EB-6, available to any immigrant entrepreneur who has secured at least $250,000 in capital from accredited venture capitalists or angel investors. After two years, the person would become a permanent U.S. resident if his or her business has met one of three criteria: created five full-time jobs in the U.S., raised an additional $1 million from investors, or achieved $1 million in revenue.

If this is made law, I can foresee bucketloads of talent heading West.

And good for them, all things being equal, I’ll be there too.

Meanwhile to all British entrepreneurs reading, your head can go back in the sand now.

Update: Thanks to @micrypt for adding this post into the Hacker News feed here. I noticed an excellent comment on that discussion by Pete Warden who links to both Paul Carr’s Guardian column (“I’m calling time of death on London’s startup industry“) on a similar subject and his own analysis (“You can’t fail if you don’t try. Or why I left the UK“).

Definitely worth reading both.