Billionaire Silicon Valley investor Michael Moritz, whose investments in Google, PayPal, and other tech giants helped shape the modern internet, has sharply criticised President Donald Trump’s $100,000 H-1B visa fee, warning that the policy will backfire and demonstrates the administration’s fundamental misunderstanding of what drives American tech success.The policy, announced Friday through a presidential proclamation, imposes the steep fee on new H-1B visa applications starting September 21, representing a dramatic increase from current fees of $2,000 to $5,000. The administration also proposed overhauling the lottery system to prioritise higher-paid workers, with the Trump administration claiming the program has been “deliberately exploited to replace, rather than supplement, American workers.“
The announcement triggered panic across Silicon Valley over the weekend, with companies including Amazon, Microsoft, and Google advising H-1B employees to return to the US before the Sunday deadline.
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Writing in the Financial Times, Moritz argued that Trump’s “H-1B caper will backfire” because advances in technology make it easier for companies to move work overseas rather than bring foreign workers to America. The former Sequoia Capital partner warned that the policy shows “the fragile grasp the president and his acolytes have about why the US — especially its technology sector—has worked so well.”The H-1B program currently allows 85,000 skilled foreign workers annually to work in the US for up to six years. Indian nationals account for 71% of approved visas, with the program heavily used by tech companies and IT consulting firms. Moritz noted that “engineers with undergraduate degrees from the better eastern Europe, Turkish and Indian universities are every bit as well qualified as their American counterparts,” underlining the caliber of talent that could be affected by the policy changes.
Tech companies hire for skills, not cost savings
Moritz, who built his reputation investing in companies like Google, PayPal, LinkedIn, and YouTube during their early stages, dismissed Trump’s claims that companies abuse the H-1B program to replace American workers with cheaper foreign labor. In his FT column, he emphasised that “large tech companies hire foreign nationals because they possess particular skills” and retain them “to perform tasks in areas where the US has labour shortages.“The investor argued that companies don’t hire H-1B workers “to deprive Americans of jobs or for cost reasons,” contradicting the administration’s core justification for the fee increase. He noted that US companies are already “forbidden to discriminate against foreign workers doing the same jobs as American citizens” and must notify employees before hiring foreign workers.Trump’s proclamation cited multiple examples of tech companies laying off American workers while simultaneously hiring thousands of H-1B visa holders. One unnamed software company was approved for over 5,000 H-1B workers in fiscal year 2025 while announcing layoffs totalling more than 15,000 employees, according to the White House. The administration argued this demonstrates the program is being used to replace rather than supplement American workers.
Policy could drive innovation overseas
Rather than protecting American jobs, Moritz warned the policy could push tech innovation abroad. He noted that skilled engineers from “better eastern Europe, Turkish and Indian universities are every bit as well qualified as their American counterparts,” and much of their work “can be done as easily in Istanbul, Tallinn, Warsaw, Prague or Bengaluru as in San Francisco.”The investor predicted that companies fearful of Trump’s next move might change their policies, meaning “these foreign economies rather than the US will receive a shot in the arm.” This would also “deprive America of a fresh generation of entrepreneurs since the most able of the H-1B visa holders often go on to start companies of their own.”Moritz’s warnings contrast sharply with support from some tech leaders, including Netflix co-founder Reed Hastings, who called the $100,000 fee “a great solution” that would ensure H-1B visas are “used just for very high-value jobs.” However, most Silicon Valley executives have criticised the changes as harmful to innovation and startup growth.The policy has already created international ripple effects. India, which supplies 71% of H-1B visa holders, responded through its external affairs ministry that the fee would have “humanitarian consequences” and cause family disruptions. Indian Commerce Minister Piyush Goyal suggested Americans are “afraid of our talent.”Moritz suggested the administration should instead expand the H-1B program, proposing to “double or triple the number of H-1B visas” and automatically offer citizenship to foreign nationals earning STEM PhDs from top American universities. He highlighted successful immigrant CEOs including Satya Nadella of Microsoft and Sundar Pichai of Google as examples of the program’s benefits, noting in his FT piece: “Two of the finest chief executives in the US, Satya Nadella of Microsoft and Sundar Pichai of Google, are here because of the attitudes of prior administrations.”
