The Birth of a Radical Idea
Even in a field known for creativity and innovation, rarely does an idea like Blueseed come along. Like most radical ideas, it was born out of necessity, and a need to solve a major problem. Tech startups from across the world wish to move their budding enterprises to Silicon Valley, the undisputed world capital of computer technology. However, the rules are somewhat complicated. Unless you are hired by an established tech company, you can’t get a work visa. Legislation that would allow the creation of special Startup Visas went to congress, and as you know, congress does things at its own pace. A group of problems solvers in Silicon Valley had a Eureka moment. What if there was a startup incubator floating just a few miles off the coast of California, unrestricted by US Visa laws?
The Concept behind Blueseed
The concept was simple. A vessel would be docked 12 miles into the Pacific, just outside the waters considered to be within US territory. Foreign nationals with startup ideas would be invited to reside and work in the vessel. This would of course be no ordinary ship. It was to be designed as a floating campus. The foreign nationals who wished to visit the US mainland would only require a business and tourism visa, not a work visa. In effect, these startups would be in Silicon Valley without violating any laws.
The Positive Reception of the Idea
The word genius was used by several Silicon Valley insider and media figures to describe the idea. Hats were tipped to the founders of the company, and international startups described Blueseed as the ultimate solution to the challenges they faced. The company came up with concept designs that were the envy of many in the valley. Now it was time to execute the idea.
Legal Issues Surrounding Blueseed
They say there is nothing new under the sun. As it turns out, there was legal precedence in this matter thanks to cruise ship companies and casino businesses. The Blueseed concept didn’t violate US or international law, so it got a green light from the US Coast Guard. There was still the small matter of which flag the vessel would fly, and the Bahamas banner was in top contention. The company would also not withhold tax for the residents of its vessel. Startups would instead be required to report their own income to the countries where they were incorporated.
The Funding For the Startup The company was officially founded in July of 2011, and collection of funds began soon after. They had to acquire a ship and to remodel it. It was estimated that an initial capital investment of $27 million would be required to set the whole thing in motion. An unnamed investor had put up $9 million right off the bat. An additional $ 300,000 in seed money was collected, plus some Bitcoin contributions. Over three hundred startup companies from across the world had applied for residence in the floating campus by the end of 2012. The project was to start in the summer of 2014 if Blueseed could raise $18 million.
Why Blueseed Failed
The summer of 2014 came and passed, and the Blueseed accounts where still under the target $18 million. The entire project was put on hold until further notice. At the end of the day, the project failed because there weren’t enough investors who believed in it enough to put up their money. Also, there was the lingering issue of the Startup Visa Bill before congress. If that bill were to pass, the whole concept would become obsolete, and investors would lose their money. The answer to the question of what really sank the Blueseed boat, is the uncertainty that surrounded the whole project. Future legislation was a key consideration for investors who ultimately decided to sit it out.