The World's Top 5 Startup Visas: What Can New Zealand Learn?
In June 2015, Kiwi Connect hosted the leadership from Immigration New Zealand on a tour of Silicon Valley to explore how we can better build bridges to attract exceptional talent to New Zealand and create a vibrant startup ecosystem. Nigel Bickle, CEO of Immigration New Zealand, and Matt Hoskin, National Manager for Skills and Investment toured various companies such as Y Combinator, Google and Inflection, held roundtable discussions with leading investors and entrepreneurs in order to explore opportunities, build partnerships, and gain a better understanding of what makes innovation ecosystems like Silicon Valley thrive.
The global economy is changing rapidly, and visionary entrepreneurs are in many ways leading that change. The democratisation and accessibility of knowledge is lowering the barrier for motivated individuals to pursue entrepreneurial paths, with little regard to age, educational or work background, nationality, and economic status. Technological innovations are creating efficiencies, transforming entire industries, and impacting the ways our societies operate. In this age of rapid change, entrepreneurial talent and creative minds are emerging as global citizens who want to move and work across borders, solving problems with multiple teams and projects, and who are motivated to create disproportional impact on the world. This phenomenon of global citizenship is very close to home when over one million Kiwis are spread across the globe, and a number of them impacting the world in unique ways. Today, almost every country produces and is inhabited by global citizens, and that trend is growing.
We are in the midst of a global race for talent, and New Zealand stands to gain a lot by creating attractive pathways for talented entrepreneurs, investors and creative people to incubate solutions to global problems, create jobs and drive economic growth locally. Already, our high quality of life, political stability, vast ecological wealth and social cohesion is appealing to many. Talented entrepreneurs recognise that New Zealand’s distance and small size is becoming a distinct advantage, with close-knit entrepreneurial communities, responsive open markets and a culture of experimentation.
The trip to Silicon Valley by the head of Immigration signals that the department are seriously looking at ways to fulfill Sir Paul Callaghan’s vision to make New Zealand “a place where talent wants to live”.
An increasing number of countries are creating visas to attract entrepreneurial talent, and the competition is getting fierce as more countries join the race. Below we explore what we can learn from other nations in the ways they are attracting entrepreneurial talent, outlining the world’s top five countries for startup visa policies.
Start-Up Chile is a hands-off, bottom-up programme driven by entrepreneurs, which attracts and actively nurtures early-stage entrepreneurs to “use Chile as a platform to go global”. Launched in 2010, the programme operates as a competition, with three rounds each year, where successful applications receive a US$40,000 government grant, a 1-year working visa, free office space, mentoring, and hospitality. To date, over 1,200 startups have taken part in the programme, collectively raising over US$100 million in funding. The government’s non-prescriptive approach has been pivotal to the success of this programme. The country relied on Start-Up Chile to deliberately attract talent and develop a startup ecosystem from scratch. In less than 5 years, it successfully positioned itself as a destination for talented minds and created a unique global brand.
A key advantage of Ireland’s programme is that it uses a third party entity to vet applications for entrepreneur visas, meaning that experts who are skilled at picking winners are part of the process. In a move to capture young talent at the beginning of their careers, Ireland allows foreign entrepreneurs attending incubators or innovation boot camps, and non-European Economic Area (EEA) students who graduate with advanced science, technology, engineering and mathematics degrees to stay in Ireland for a year, giving them a chance to prepare an application for the entrepreneurship visa.
The country also offers a broad range of investment categories to qualify for a visa, including government managed funds, and endowments towards public projects benefiting the arts, sports, health, culture or education.
Singapore’s EntrePass visa programme is designed to capture value and retain it within the country. Proposed business ideas must be able to create local employment, and the entrepreneur must plan to retain at least 30% shareholding in the business, which encourages personal investment in growth and value creation rather than quick exits. Targeting early stage businesses with high growth potential, the programme also requires that companies are not yet incorporated, or if they are, that the company is not more than six months old at time of application
While it is early days for the Netherlands’ entrepreneurship visa, launched in January 2015, the programme is promising in its collaborative approach. If approved, the applicant is referred to Startup Delta, a partnership between government, accelerators, investment groups and startups, to provide them with mentorship and guidance on starting a business in the Netherlands. This full ecosystem approach ensures that individuals and companies are given widespread support from existing networks, and are provided with opportunities for collaborative development of ideas.
The first startup visa was granted to New Zealander Finn Hansen, whose business Med Canvas develops tools for collecting medical information for doctors and other medical professionals.
The strength of the UK’s approach is in its flexibility and multi-option offering, which recognises the diversity of entrepreneurs, their varying circumstances and stages of their career. The graduate entrepreneur visa allows graduates to stay one or two years after graduation to start a business with no funding requirement. The prospective entrepreneur visa allows an individual six months in the UK to raise funding, while the Tier 1 entrepreneurs visa requires £200,000 or £50,000 in seed funding, depending upon the source of the investment. The UK also allows entrepreneurs that go through certain accelerators to benefit from a fast track and a lower capital threshold.
As Immigration New Zealand is developing new thinking around how to attract entrepreneurial talent, we can learn from other countries successes and failures and design the programmes that best fit New Zealand. Entrepreneurs don't always fit into predetermined boxes, they are working on multiple ventures and experimenting with various organisational structures. Funding requirements aren't necessarily applicable to all types of ventures, and government grants alone aren't enough to incentivise people to move somewhere. The most innovative minds with global impact potential are inherently doing things that are different and non-linear; so linear screening processes and filters can easily miss outliers. We have an opportunity to truly innovate on how we attract and retain talent. And in talent attraction, creative approaches attract the most creative people.
The great news is that New Zealand has a lot going for it, and it is in high demand from entrepreneurs who are at the most productive stage in their lives. It has a growing startup ecosystem actively seeking global talent. With pathways accessible to creative minds who are outliers to existing visa programmes, New Zealand can build a global brand around positioning ourselves as the place talent wants to live: the type of talent that continues to impact the world.