BenchPrep cofounders Ashish Rangnekar and Ujjwal Gupta were attempting to launch their startup from opposite sides of the world in 2010.

Gupta was in India, his home country, because he didn’t want to risk starting the company on Optional Practical Training (OPT), a 12-month post-grad visa usually given to students who get a job after they graduate. Rangnekar, an Indian UChicago Booth student, was in Chicago looking to get an H-1B, the highly sought-after visa given to immigrants employed in the US, after graduation in order to work on BenchPrep.

“That was such a stressful time,” Gupta said. “We were thinking of starting the company in India at that time.”

But the cofounders forged on. BenchPrep won UChicago’s New Venture Challenge and caught the eye of Eric Lefkofsky, raising $2 million round from Lightbank, enough to get Gupta a H-1B to come back to the US to work on the startup. Rangnekar attempted to get an H-1B to work on BenchPrep after graduation, but wasn’t successful (he later got a green card through marrying his girlfriend of six years). Now BenchPrep has raised $8 million total in funding, employs more than 15 people, and is profitable.

Their hustle despite visa headaches is not unique.

Immigrants make up 13 percent of the US population, but 51 percent of the unicorns in the US have foreign-born founders. In Illinois, immigrants account for 40 percent of venture-backed businesses, and two of the four Illinois unicorns (Mu Sigma and Avant Credit) have foreign-born founders.

However, there is no specific visa for foreign-born entrepreneurs, and legislation to create a clearer path for founders has largely died amid the larger immigration debate.

In the meantime, foreign-born founders, particularly those drawn to top-ranked US universities, lose time working on their venture to navigate their immigration status, or give up on entrepreneurship in the US due to visa complications.

“We educate the worlds best talent and watch them leave due to the inability to get visas,” said Al Goldstein, cofounder of Avant and University of Illinois Urbana-Champaign alum, who came to the US with his family from the USSR when he was 8. “When they stay they can start companies and create countless opportunities for more Americans.”

Here’s how six Illinois founders navigated entrepreneurship and immigration.

Cracks in the university pipeline

Illinois is a hotspot for foreign-born students. UIUC alone enrolls over 11,000 foreign-born students, a number that has caused some controversy, as critics say state schools’ acceptance of large numbers of foreign students takes away from educating Illinois students. These students are flooding STEM majors: Currently “immigrant students” (foreign-born students on F1 student visas) make up one out of every five non-healthcare STEM degrees in Illinois, the highest proportion in a decade and 40 percent higher than the national average, according to the Illinois Science and Technology Coalition.

We educate the worlds best talent and watch them leave due to the inability to get visas

That has led to an increase in foreign-born entrepreneurs: at least 20 percent of the 611 active startups to come out of Illinois universities (that stay in-state) have at least one foreign-born founder, ISTC found.

“In the entrepreneurship center we see a disproportionate amount of foreign-born students,” said Ellen Rudnick, executive director of UChicago’s Polsky Center for Entrepreneurship, at a recent Chicago Council on Global Affairs event. “They are very interested in starting companies, and many of them come here…working on their ideas as they go through the program.”

Rudnick said 140 companies have come out of UChicago Booth, but estimates at least 60 more would have been created if students weren’t intimidated by the complex and difficult-to-navigate visa process.

Rho Kook Song, a Booth student from South Korea, first came to the US to study economics at UChicago, but entrepreneurship events at the school sparked his interest in startups. Song and fellow Korean UChicago student Hyesung Kim (pictured) came up with the idea for Freenters, which offers students rewards for printing advertisements along with school documents. While working on OPT visas, they expanded to over 22 campuses, with 15,000 users, and won the College New Venture Challenge at UChicago.

The cofounders planned on continuing their education and continuing to work on Freenters. But only Song got into the graduate program he wanted to attend (the MBA program at Booth, where he is currently a student). Kim didn’t. With few options left, Kim returned to South Korea. He worked on the startup for a few months from abroad, but eventually the distance and time difference prevented him from continuing to work on the startup.

Song still works on Freenters, though without a cofounder. “As an entrepreneur you have a ton of things you already need to think about, [and] a lot of problems in your business you need to solve,” he said. “This is an additional headache.”

Vague policy contributes to the “visa headache.” Rajesh Karmani (pictured above) founder of Zero Percent, a startup that connects restaurants with excess food to nearby nonprofit organizations, originally came to Illinois to get his PhD in computer science from UIUC. Karmani pored over immigration policy to be sure he could start his company on OPT. Without mentors and no money for immigration lawyers, he had to rely on his own policy interpretation to assess the risk of starting a company.

“It was definitely a personal decision, based on very good research,” he said. “I read up on the policy, and [tried] to find if there was any ‘No.’ Nobody gave me a no, right? That is enough, right? So maybe it’s a yes.”

Startups find solutions outside of Illinois

When University of Massachusetts Boston first announced the Global Entrepreneurs in Residence Program (GEIR) in 2014, it caught the eye of Arnav Dalman, Shivani Jain, and Ryota Sekine, UChicago alums and founders of FitnessCubed, the startup behind under-desk elliptical machine Cubii.

To address the lack of visas for entrepreneurs, GEIR offers H-1B visas to founders, who hold jobs at the university while working on their startup (it’s also being piloted at University of Colorado-Boulder). All three founders are foreign-born, and within a year of graduating in 2013 Jain and Sekine were working from their home countries because their OPT ran out. Dalman was keeping up with their nocturnal hours while working a corporate job on H-1B.

Given their traction, connections and resources stacking up in Chicago, they wanted to remain in the city, but GEIR seemed to be their only hope to grow in the US. They applied to the GEIR, and Jain and Sekine additionally applied for O-1 visas, a class of visas reserved for individuals with “extraordinary ability or achievement” as judged by immigration authorities. Lawyers said they had “less than a 1 percent chance” of success.

“We were literally at the verge of moving to Boston and the decision was just hanging on the…O-visa,” said Dalman.

Jain and Sekine were both granted the O-1 visa, and Dalman was able to transfer his H-1B visa to FitnessCubed. Today, FitnessCubed remains in Chicago, where it’s raised $293,000 on Kickstarter and $650,000 from investors.

“We were fortunate because of the nature of the product and Kickstarter we were able to get and prove that early traction, but depending on the nature of the company, not all companies can do that,” he said. “I think that’s still broken.”

Policies make it tough to keep tech talent

H-1B visas are a particular sticking point in the immigration debate. The cap dropped from 195,000 to 85,000 in 2004, and this year a record 236,000 applications were submitted. Recent abuse of the program has squeezed out highly-qualified workers that the program was set up to retain.

Outsourcing companies game the system to replace American workers with lower paid immigrant workers: The New York Times reported 20 companies (out of 10,000 that applied) received approximately 40 percent of visas. These companies, which include 13 outsourcing companies based in India, flood the system with applications and pay immigrants less than market rate, usually around $60,000.

This rigged system also means startups are less likely to get an H-1B for highly qualified immigrants they want to hire.

Samir Mayekar, a Northwestern Kellogg alum and founder of SiNode Systems, a battery technology startup out of Northwestern, lost one of his former top employees who had a masters degree in materials science from Illinois Institute of Technology and was Chinese. He wasn’t selected in the lottery last year and, lacking other options, the employee quit the startup and returned to China.

“It’s tough as an entrepreneur, leaving the future of your business to a lottery,” Mayekar said. “The people at your company are the future of the company.”

It’s tough as an entrepreneur, leaving the future of your business to a lottery

Last year Nihal Advani (pictured above), founder of Georama, a startup that offers live, virtual tours for colleges, hotels and travel companies, spent over $5,000 in application and lawyer fees to get an H-1B visa for one of his top technical employees, who is also from India. Though his employee received a visa through the lottery, Advani said committing precious financial and time resources to the process can drain startups.

“For big companies it doesn’t matter as much,” Advani said. “For small companies, these things add up, these things matter. These aren’t the things that should discourage you from having the right employee.”

Losing out on an employee through H-1B can also mean losing out on a potential future founder. Advani came to the US from India for college, and spent a year working for Microsoft in Toronto after not being selected in the H-1B lottery. He received one after being transferred to Chicago, and later spent a year unsuccessfully trying to transfer his H-1B to his startup. Advani only launched Georama once he got a green card, and said the delay cost him being first to market with the tech.

“That was an absolute nightmare,” he said. “I loved my job, but I was ready to do my own thing. I was leaving a very well paying job, taking the money I saved to create jobs here.”

Though many entrepreneurs use H-1B at some point, they agree the program is not ideal for founders. Startups have to have significant traction and potential to be able to sponsor an employee, and even then each application can be reviewed and rejected. Companies also have to be able to prove they control a worker’s employment: if a founder owns a large stake in a company, it appears less likely that they will be fired.

Last November Senators Chuck Grassley (R-Iowa) and Dick Durbin (D) of Illinois introduced legislation to limit H-1B visas, particularly abuse by large companies, and prioritize applicants with degrees from US universities. But Grassley has said those who start companies off H-1B are taking advantage of the system.

“The original intent of the program is good,” Grassley told Bloomberg in February. “But the abuse of the system is real.”

Could a ‘startup visa’ be the answer?

Many entrepreneurs agree providing a ‘startup visa,’ which would give entrepreneurs temporary work authorization while they proved traction, is ideal. But policy along these lines has largely stalled.

One example is the Startup Act, which would allocate 75,000 three-year visas to foreign-born entrepreneurs. If founders meet certain investment and hiring benchmarks, they can apply for a permanent visa. The legislation would also add 50,000 visas for foreign-born students who graduate from U.S. universities with STEM degrees

Legislation was introduced to the Senate last January, and it’s currently in the Committee on Finance, where it has stalled as Republicans and Democrats differ over whether to reform laws piece-by-piece or a comprehensive overhaul.

In the meantime President Obama issued an executive action in 2014 that would grant parole–permission to remain in the US but not permanent residence–for startup founders that have raised significant capital or show promise in creating jobs. However, the action is not in effect and no regulations have been issued.

In the meantime, countries such as Chile, New Zealand, Australia, Ireland, India and Canada (among others) have programs to attract foreign founders.

As for an entrepreneur visa, there’s the worry people would set up fraudulent companies and investment, given how the H-1B program has been so expertly gamed. But Matt Meltzer, an immigration lawyer that consults at the Chicago Innovation Exchange, said it’s a small percentage. “The overwhelming majority are using the visa classes in a way that is true to the way they work,” he said. “Those people are not looking for a vacation in the United States. They’re looking for opportunity.”

Photo Credit: American Inno