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3 Roadblocks to Success as a Startup

2. Immigrants can't start companies if the U.S. kicks them out of the country

The nation's top university labs are full of non-U.S. citizens whose research could yield myriad technology startups. In fact, immigrants founded 7,000 technology companies between 1995 and 2006, according to the Kauffman Foundation.

During that time, about 25% of tech companies in the U.S. had founders from other countries. The problem is that while foreigners have good luck acquiring student visas, the visas run out once they stop being students and start starting companies. The U.S. offers a visa for foreign investors, the EB-5, which requires a business investment of at least $1 million and the creation of at least 10 jobs. But the EB-5 is little solace to entrepreneurs whose businesses are too new to be profitable, but who want to stay in the country to make that first million bucks.

"If we had our way, for every foreign-exchange student that graduated with an advanced degree in science, education or math, we'd staple a Green Card to their diplomas," Ruhe says.

3. Angel investors are getting cliquey

In headier times, angel investors were wealthy individuals who provided initial capital for all sorts of startups. These days, a lot of angels are pooling their resources into group funds, which decreases the variety of investments.

"They used to be risk takers taking a chance on something that was early-stage and promising," Ruhe says. "What they've done is started syndicating and acting more like mini-me's of VCs."

-- Reported by Carmen Nobel in Boston.



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