Zaarly on Capitol Hill: Why the Startup Ecosystem Matters

5/13/11

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continual protection of investors, but we should take lessons from organizations using microlending and crowd sourced funding to alleviate poverty in other nations to also spur private investment in community-organizations.

I encourage the investigation of regulations to permit groups of individuals, businesses and organizations to make investments in private companies, small businesses and startups.

—Immigration Reform:

As an entrepreneur and supporter of the entrepreneurial eco-system, I also believe it is crucial to consider the importance of immigration reform in the long-term success of this sector. While not directly related to the hearing I attended, I urged Congress to examine two key programs which directly support and benefit the startup ecosystem:

Expansion of visa programs for individuals intending to work at early-stage businesses. Talent remains at a premium and there is a clear shortfall of citizens and foreign residents with the technical and scientific skills required to build businesses required in the innovation economy.

Startup Visa. Proposed legislation described as a “Startup Visa” to provide a mechanism for foreign individuals starting qualified businesses in the United States to remain here so long as they meet certain pre-set criteria. This legislation will encourage investment in foreign talent intending to build businesses in the U.S. that increase jobs and build long-term economic value.

I believe talent is one of the most important resources required for building a successful business. I have worked on the Startup Visa initiative for the past two years and hope that we can eventually find a solution in that issue. America continues to serve as a location where individuals from the world-over hope to come and participate in the entrepreneurial ecosystem. We should leverage this fact to help support existing businesses as well as new businesses that can or will be formed by these foreign entrepreneurs.

Conclusion

I am fortunate to have the opportunity at Zaarly to build something I’m passionate about and believe can have a big impact on local economies. However, I recognize that this would not be possible without support of our investors – who have made a bet on our team and this idea. Therefore, I believe it is crucial to do everything in my power to help other entrepreneurs out there trying to build their company, attract investment and create a great company.

Pushing for these reforms may seem like a slow and uphill battle, but its crucial for us as members of the startup ecosystem. So thanks for the opportunity fellow entrepreneurs – and let’s continue to work to make entrepreneurship as the centerpiece of our economy.

This post originally appeared on the Zaarly blog.

Eric Koester is co-founder and COO of Zaarly and an attorney, formerly with Cooley LLP. Follow @

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  • Gary Masner

    Eric,
    Great ideas, but let me add another piece to focus on. I retired after 10 years in Silicon Valley VC trade, and have been volunteering helping Colorado startups raise money. Most of these are good business ideas, but will never go public or raise VC money. They don’t want a C corp structure and look to angel investors for equity. The problem is the complexity of K-1 reporting for investors and the treatment of income. Investors are often repaid out of cash flow.
    We need a new form of tax structure for startups. Maybe a 10 year transition to a C corp structure, with investor paybacks being tax deductible to the company and capital gains to the investors.

  • marshall sterman

    concur with Eric’s recommendations/thoughts/observations but they do not address the need to change the mentality/anti-capitalistic/we versus them mentality of our regulators. The excess time/costs/inordinate delays over language/munitia in getting to final approvals has killed more financings than any rules and regs that most of us also regard as excessive.

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