A few times over the last couple of months I have been asked what government could do to help startups.  I believe there are five different areas that could really make a difference.   The first two are specific to the kind of startups that we invest in at Union Square Ventures, but the other three apply across the board.

1. Net Neutrality
By this I mean a clear commitment to separating bandwidth, devices and applications.  Once I have bought a certain chunk of bandwidth (whether wired or wireless), I should be able to connect any device and run any application without further restrictions or meddling from the bandwidth provider.

2. Patent Reform
Figuring out how to stop patent trolls and nuisance suits over software patents that shouldn’t have been issued in the first place.  Maybe as a first step there is simply a way to create a safe haven for startups.  But ideally these kind of patents are drastically curtailed across the board including already issued ones.

3. Angel Capital Gains Taxation
As I have written repeatedly before, the toughest stage of financing are the earliest dollars.  And these come with a huge social benefit not captured by the investor.  To offset this imbalance the capital gains tax for angel investments should be as low as possible.  10% or lower would be great.

4. SarbOx Redux
It is too painful to go public.  We have several companies in our portfolio that pre-Sarbox would have already gone public.  But the cost of being public is too high and companies just don’t want to deal with it.  The lack of exits is clogging up the investment pipeline and and is a drag on returns resulting in under-investment.  The kind of fraud that SarbOx was designed to fight is exceedingly rare among high-tech startups, many of which have very simple business models (and usually only one or two lines of business).

5. Startup Visa
We need all the talent we can get to help invent the future.  That means we should make it easy, not hard, for folks with advanced degrees and/or startups to come to the US or stay here.  Every advanced degree awarded here should qualify the recipient for a green card or at least a work visa.  Founders of startups from abroad should be given an easy visa for bringing their startup to the US or getting it going here.

I have titled this post as “five (not so) easy pieces” because I recognize that each of these is a potential legislative minefield.  But just because it’s hard doesn’t mean we shouldn’t try.  After all, that is what startups are about – going up against the odds!