After President Donald Trump signed a proclamation Friday to add a $100,000 fee for new applicants of H-1B visas for skilled foreign workers, two technology leaders reacted in opposite ways.
Selin Kocalar, 21, the chief operating officer of Delve, an artificial intelligence startup in San Francisco, learned of the change from a new employee who had just been approved for the H-1B visa. She said she was grappling with what the fee meant for hiring at her 23-person company, which has raised $35 million in funding.
"As a startup, you're always tight for cash," she said. "So you can't go out and spend a bunch of money or have that kind of luxury that you'd see at a bigger company."
Also Read| No H-1B visa, no Nadella or Pichai: what US boardrooms could have missed
In contrast, Reed Hastings, the chair and co-founder of Netflix, did not blink. The $100,000 fee "is a great solution," he posted on social media Sunday. "It will mean H-1B is used just for very high value jobs." Netflix, which has approximately 14,000 employees, pulled in more than $11 billion in revenue and $3.1 billion in profit in the most recent quarter.
The different responses show how the Trump administration's visa change is rippling through the tech industry -- which uses H-1Bs to hire thousands of software engineers, AI specialists and others -- in a way that may create haves and have-nots. While the biggest tech companies have the money to absorb the new fee, startups are concerned about their ability to attract and pay for talent, particularly when they have limited funding and agonize over every dollar spent.
The change may hit at the heart of the U.S. tech ecosystem, tilting the scales in favor of incumbent giants with billions of dollars. Silicon Valley relies on a steady stream of startups to advance new ideas and technologies, with some of the ventures eventually growing into behemoths.
Also Read| H-1B visa fee hike may block 5,500 work permits monthly
"This will be a disproportionate hit on smaller companies because we cannot compete with OpenAI and Meta," said Aizada Marat, the CEO of Alma, an immigration legal services startup in Palo Alto, California, which helps companies handle employee visas.
If the $100,000 fee imposed by the government sticks, Marat said her company, which has raised $5.5 million in funding and relies on foreign workers, will not be able to hire people through the H-1B visa program.
The change could ultimately hurt U.S. leadership in tech, some entrepreneurs said, especially as the country engages in a heated contest over AI with China.
Jihan Merlin, the head of immigration strategy at Alma, said the new visa fee was unlikely to affect the country overnight, "but policy changes like this make people think twice about bringing their companies to the U.S.," she said. "And over time that's going to change our competitiveness as a country."
A typical H-1B visa costs companies about $10,000 including legal fees and administrative costs, Merlin said.
Tech leaders and politicians have long agreed that the United States needed other ways to attract and retain talent and that the current system for doling out authorization for skilled foreign workers was ripe for reform. The H-1B program has relied on a lottery system and capped visas to 85,000 a year.
In June 2024, Trump acknowledged the issues during his presidential campaign and proposed that anyone who graduated from a U.S. university or junior college should receive a green card to live and work in the country. Some of his closest backers recoiled at the idea.
"You need a pool of people to work for your companies," he said on "The All-In Podcast," which is hosted by several tech investors. "You have great companies, and they have to be smart people."
Trevor Traina, a San Francisco-based founder who served as an ambassador during Trump's first presidency, called the new H-1B changes "an opening bid" to change the conversation on immigration.
"The tech industry would benefit from more visas for skilled foreign workers and I'm sure many are hoping this will lead to a good long-term solution," he said.
Others are not so sure. The policy change disrupts the pipeline of top tech talent coming into the United States and compromises its edge in the global AI race, said Bilal Zuberi, 49, a managing partner at Red Glass Ventures.
"Disrupting that is really shooting ourselves in the foot," Zuberi said. He estimated that about 30 to 40 companies that he has backed will be affected by these changes.
Zuberi said startups may find workarounds to the new H-1B visa fee, including by using the extraordinary talent, or O-1 visa, program or by setting up offices in other countries, like Canada, to hire remote employees.
"I don't think the answer for these companies is going to be 'Oh, why don't we just hire Americans?'" he said.
Selin Kocalar, 21, the chief operating officer of Delve, an artificial intelligence startup in San Francisco, learned of the change from a new employee who had just been approved for the H-1B visa. She said she was grappling with what the fee meant for hiring at her 23-person company, which has raised $35 million in funding.
"As a startup, you're always tight for cash," she said. "So you can't go out and spend a bunch of money or have that kind of luxury that you'd see at a bigger company."
Also Read| No H-1B visa, no Nadella or Pichai: what US boardrooms could have missed
In contrast, Reed Hastings, the chair and co-founder of Netflix, did not blink. The $100,000 fee "is a great solution," he posted on social media Sunday. "It will mean H-1B is used just for very high value jobs." Netflix, which has approximately 14,000 employees, pulled in more than $11 billion in revenue and $3.1 billion in profit in the most recent quarter.
The different responses show how the Trump administration's visa change is rippling through the tech industry -- which uses H-1Bs to hire thousands of software engineers, AI specialists and others -- in a way that may create haves and have-nots. While the biggest tech companies have the money to absorb the new fee, startups are concerned about their ability to attract and pay for talent, particularly when they have limited funding and agonize over every dollar spent.
The change may hit at the heart of the U.S. tech ecosystem, tilting the scales in favor of incumbent giants with billions of dollars. Silicon Valley relies on a steady stream of startups to advance new ideas and technologies, with some of the ventures eventually growing into behemoths.
Also Read| H-1B visa fee hike may block 5,500 work permits monthly
"This will be a disproportionate hit on smaller companies because we cannot compete with OpenAI and Meta," said Aizada Marat, the CEO of Alma, an immigration legal services startup in Palo Alto, California, which helps companies handle employee visas.
If the $100,000 fee imposed by the government sticks, Marat said her company, which has raised $5.5 million in funding and relies on foreign workers, will not be able to hire people through the H-1B visa program.
The change could ultimately hurt U.S. leadership in tech, some entrepreneurs said, especially as the country engages in a heated contest over AI with China.
Jihan Merlin, the head of immigration strategy at Alma, said the new visa fee was unlikely to affect the country overnight, "but policy changes like this make people think twice about bringing their companies to the U.S.," she said. "And over time that's going to change our competitiveness as a country."
A typical H-1B visa costs companies about $10,000 including legal fees and administrative costs, Merlin said.
Tech leaders and politicians have long agreed that the United States needed other ways to attract and retain talent and that the current system for doling out authorization for skilled foreign workers was ripe for reform. The H-1B program has relied on a lottery system and capped visas to 85,000 a year.
In June 2024, Trump acknowledged the issues during his presidential campaign and proposed that anyone who graduated from a U.S. university or junior college should receive a green card to live and work in the country. Some of his closest backers recoiled at the idea.
"You need a pool of people to work for your companies," he said on "The All-In Podcast," which is hosted by several tech investors. "You have great companies, and they have to be smart people."
Trevor Traina, a San Francisco-based founder who served as an ambassador during Trump's first presidency, called the new H-1B changes "an opening bid" to change the conversation on immigration.
"The tech industry would benefit from more visas for skilled foreign workers and I'm sure many are hoping this will lead to a good long-term solution," he said.
Others are not so sure. The policy change disrupts the pipeline of top tech talent coming into the United States and compromises its edge in the global AI race, said Bilal Zuberi, 49, a managing partner at Red Glass Ventures.
"Disrupting that is really shooting ourselves in the foot," Zuberi said. He estimated that about 30 to 40 companies that he has backed will be affected by these changes.
Zuberi said startups may find workarounds to the new H-1B visa fee, including by using the extraordinary talent, or O-1 visa, program or by setting up offices in other countries, like Canada, to hire remote employees.
"I don't think the answer for these companies is going to be 'Oh, why don't we just hire Americans?'" he said.
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