Foreign Investment Archives - National Venture Capital Association

Category: Foreign Investment

CFIUS & VC: 3 Takeaways from the Final Rules and What Investors Must Know

blog, Foreign Investment, Public Policy January 27, 2020/by Jeff Farrah

The Treasury Department recently released the long awaited final rules implementing the Foreign Investment Risk Review Modernization Act (FIRRMA), and they go into effect February 13, 2020. Through FIRRMA, Congress gave CFIUS significant new powers to police investments into certain U.S. companies and has made CFIUS highly relevant in the startup ecosystem. CFIUS’s power was demonstrated in recent high-profile cases that forced Chinese investors to divest of holdings in Grindr, PatientsLikeMe, and Musical.ly. The combination of CFIUS interest in data rich companies and their expanded authority over non-controlling investments means the agency will be a player in the startup ecosystem going forward. Read more

Should VCs Care What the Government Considers “Emerging Technology”?

blog, Foreign Investment, Public Policy December 20, 2018/by Jeff Farrah

TL; DR: YES.

Okay, for those of you still with me: I’ve previously written about foreign investment scrutiny and its impact on the venture and startup ecosystem, including how the legislative process played out, how the new pilot program rules impact VCs, and what to expect next. In a nutshell, earlier this year Congress greatly expanded the authority of the Committee on Foreign Investment in the U.S. (CFIUS) to examine foreign investment deals for national security implications. Through the Foreign Investment Risk Review Modernization Act (FIRRMA), Congress gave CFIUS the authority to review minority, non-controlling investments by a foreign person into U.S. critical technology companies. Read more

CFIUS Head Sat Down with NVCA Members. Here’s What We Learned

blog, Foreign Investment, Public Policy November 27, 2018/by Jeff Farrah

VCs and entrepreneurs continue to be impacted by new foreign investment scrutiny. In August, the Foreign Investment Risk Review Modernization Act (FIRRMA) delivered enhanced powers to the Committee on Foreign Investment in the U.S. (CFIUS), a U.S. government entity that has been called the “ultimate regulatory bazooka” for its ability to reject foreign investment for national security reasons. Recently, NVCA members and startups heard from CFIUS leaders at our Emerging Technology Meets National Security conference. That included the Treasury Department’s Heath Tarbert, who leads FIRRMA implementation and has a major role in how the new powers will impact the venture industry going forward. Read more

Foreign investment scrutiny: 5 questions every venture investor should know the answer to

blog, Foreign Investment, Public Policy October 15, 2018/by Jeff Farrah

Venture investors and startups are waking up to a new reality as the U.S. government is newly empowered to scrutinize foreign investment, including into venture funds and by foreign strategic investors. We’ve written previously about the big impact the Foreign Investment Risk Review Modernization Act (FIRRMA) will have on venture capital. The Treasury Department recently made a bold gambit when it issued Pilot Program rules under FIRRMA (fact sheet here). All aspects of the startup ecosystem are wise to understand these rules and buckle up going forward. Read more

Foreign Investment Bill and its Impact on the VC and Startup Ecosystem

blog, Capital Formation & Regulation, Foreign Investment, Public Policy July 25, 2018/by Jeff Farrah

If you’re a VC with a foreign LP or have foreign co-investors, then you should know the law is about to change.

Later this week, Congress is expected to pass legislation that will impact foreign investment into the venture and startup ecosystem in new ways. President Trump is expected to sign the Foreign Investment Risk Review Modernization Act (FIRRMA), as he chose to back the bill rather than move forward with China-specific restrictions. NVCA is pleased to see key changes in the final bill, but it still stands to affect VC funds with foreign limited partners and/or co-investors. We will continue to engage on your behalf and encourage you to be in touch with questions or comments. Read more

How Startups and Entrepreneurs Can Power the Economic Recovery

blog, Ecosystems, Venture Investment May 13, 2020/by Ross DeVol

We worked with Ross DeVol, President and CEO of Heartland Forward, on this partner blog post to highlight the importance of entrepreneurs and startups during this crisis and how they could be the engine to get people back to work. It should come as no surprise to the NVCA community that entrepreneurs are critical to […]

Startup Ecosystem Faces Capital Crunch over Coming Months – What We Expect & Why It Matters

blog, Public Policy, Research April 28, 2020/by Maryam Haque

The U.S. startup ecosystem has rapidly entered a new chapter of what will be a turbulent period over at least the next several quarters. Investment in the startup ecosystem is expected to drop significantly at a time when the country needs it most for company and job creation towards economic recovery from the global pandemic. […]