Now more than ever before, venture capital firms aren’t just ATMs.
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Building off the concept credited to Menlo Park firm Andressen Horowitz, investors are increasingly serving as makeshift marketing advisors and product helpers as “their people help your people.” But, with immigration challenges serving as an increasing-in-size hurdle for some founders, a few VCs are outwardly offering assistance beyond monetary help.
In fact, even the team that pioneered “VCs-As-A-Service” didn’t have much to say. When I reached out for comment, Andressen Horowitz (a16z) had “nothing to share at this point.”
In fact, these VCs serve as a special network for immigrant founders.
“As a venture fund, we have one hundredth of the access than a16z does,” he said. “We’re trying to bring those same resources to our companies because we recognize one to two e-mails from an executive for a company like Airbnb” can make a company move a lot faster.
While many venture capital firms offer to pay legal fees associated with helping an immigrant entrepreneur secure a visa or other legal documentation to stay in the United States, One Way Ventures partner Lex Zhao told me that monetary support is not necessarily the issue. Rather it’s connections and education around the process that founders need help with.
“In the grand scheme of things of starting a company, it’s not about the [cost] of an application,” said Zhao. “It’s much more about the mental energy it takes” to address immigration issues.
Venture firm One Way helps founders tackle these obstacles. A popular visa for founders is the 0-1 Visa, for individuals with extraordinary ability or achievement. Among the questions asked to obtain this visa are “have you judged a major competition” or “have you been featured in reputable press.” These are all points, and factors that boost an immigrant founder’s odds for success in the application process, Zhao explained.
Even given the challenges, Zhao said he can imagine any VC tacking on immigration services if the firm already has a platform with lawyers advising on general legal help.
One Way invests in early-stage companies, and often takes deal flow from the other outspoken VC firm supporting immigrants: Unshackled. In fact, the two firms have been invested side by side in two companies to date, Pilleve and Ubiquitilink.
Unshackled, which raised a $20 million fund to invest solely in immigrant founders, covers 100 percent of the legal fees associated with onboarding. It also connects founders to services. Firm founder Mehta told me that since launching this fund, about 40 startups approach him a week.
“Immigration support is a critical part of our product,” said Mehta. “It is something that has allowed us to file 100 immigration filings in the past four years.” Unshackled provides full immigration support from work authorization visas, to the Permanent Resident Card (also known as the green card). Unshackled works with 11 different visa immigration types.
Unshackled claims it has had a “100 percent success rate in procuring visas to keep talent working in the U.S.” Since Unshackled mainly invests in pre-seed companies, Mehta said the firm uses its network to help young companies get off the ground.
“We’re effectively an immigrant family and friends round,” he said, referencing to the angel network ties that some startups, with U.S. born founders, can use to their advantage.
In a similar vein, early-stage startup Legalpad also wants to serve as that kind of network.
Legalpad wants immigrant founders to think of its firm as “the friend in the U.S. that happens to know a lot about immigration service,” said Legalpad co-founder and COO Sara Itucas.
Seattle-based Legalpad uses software and attorney oversight to help speed up the process of securing visas for startup employees. While traditional law firms are cheaper, Itucas said working with those firms can take between four to six months to put together a competitive application for a visa.
Legalpad claims it takes about two months, although at a higher price.
Currently, Legalpad targets companies coming out of accelerators, mostly because an international company doesn’t have trouble getting recruited to join Y Combinator or 500 Startups. The challenge hits when the company wants to stay in the U.S. after the program ends.
LegalPad declined to disclose its partnerships as of right now, but said it submits about 20 visa applications a month.
Despite this accelerator focus, Itucas said some VCs have taken notice of LegalPad’s tech-focused approach. In fact, One Way Ventures is an investor in Legal Pad, and it sends its other portfolio companies, all with immigrant founders, to the startup for advice and help.
“We work with a handful, it’s not a jaw-dropping number,” of venture capital firms, Itucas told Crunchbase News.
As for when that number might change?
“From a resources point of view, a lot of people are just really scared to even tackle the idea of immigration,” she said. Parts of the immigration process are opaque. Education about the process is hard. Many people don’t want to offer immigration services because they think it comes with a steep price tag, which Itucas said is a false perception.
Once those roadblocks are overcome, she thinks more people will start offering immigration services.
“When you think about it, the process doesn’t cost much more than a signing bonus,” at a tech company, she said. Say $20,000 to $25,000 to walk someone through the entire immigration process. Often times less. And to Itucas, a venture capitalist spending that much for a founder to stay in the country and build a successful company is a bargain.
Illustration: Li-Anne Dias