America does not have a startup visa, which limits business possibilities for foreign-born entrepreneurs. But more than a century ago, another immigrant entrepreneur, Julius Schmid, faced an even more significant challenge since selling the product he made (condoms) could land him in prison. That was the dilemma facing Julius Schmid in 1882 when he arrived from Germany to seek a better life in America. He had an idea—to make condoms and sell them—but his vision had one major problem: selling birth control was illegal in the United States.
An anti-birth control measure slipped into a broader bill that became law on March 3, 1872, affected the lives of millions of Americans. “Commonly called the Comstock Act after its chief proponent, the morals crusader Anthony Comstock, the statute, embedded in a broader postal act, passed after little political debate,” writes historian Andrea Tone, author of Devices & Desire, A History of Contraceptives in America. “The Comstock Act defined contraceptives as obscene and inaugurated a century of indignities associated with birth control’s illicit status. Invoking its authority to regulate interstate commerce and the US postal system, Congress outlawed the dissemination through the mail or across state lines of any ‘article of an immoral nature, or any drug or medicine, or any article whatever for the prevention of conception.’ ”
After Julius Schmid (originally Julius Schmidt) arrived in America, he discovered the streets were not paved with gold. He needed crutches to walk, which put him at a disadvantage beyond his status as a newly landed immigrant. He sold extra clothes so he had enough money to eat.
Schmid worked in a sausage factory and learned how to clean the intestines of animals to make casings. He decided to launch what became a lucrative business—turning the material used to make sausage casings into condoms, also called “skins.” But the enterprise carried great risk.
“On September 18, 1890, Comstock raided Schmid’s home and found 696 skins and ‘one form for manufacturing the same,’” writes Tone. “Released on $500 lease, Schmid was found guilty of ‘selling articles to prevent conception’ on October 28 and fined $50. Though a large sum for the average wage earner, it was not a financial obstacle for Schmidt, now a successful bootlegger. He paid the fine and summarized his life of condom crime.”
Government laws and public opinion are not independent, which eventually worked in Schmid’s favor. “Ordinary American families increasingly believed in their own right to make reproductive choices,” according to Amy Sohn, author of The Man Who Hated Women, a book about Comstock and his law. “Juries were less and less inclined to view contraceptive sellers as evil.”
Sohn writes that those most opposed to immigration encouraged strict enforcement of the Comstock Act, since nativists feared white Protestants were more likely to use birth control than Italian Catholics or other newly arriving immigrants. “New immigrants were a subject of much concern for nativists who, in the face of large families born to new Americans, feared ‘race suicide.’” (Such rhetoric can sometimes be heard today.)
World War I and concern about the spread of disease lessened the government’s efforts to prosecute the makers of a product in demand that carried significant health benefits. The US military, aware of those benefits, asked Schmid to become a supplier of condoms for American soldiers overseas during World War I and World War II. Among the condom brands manufactured by Julius Schmid were Fourex, Ramses and Sheik.
Immigrant entrepreneurs, like other business owners, become successful by keeping the interests of consumers in mind. “Whether manufacturing skins or rubbers, Schmid’s guiding philosophy was the same,” writes Tone. “He believed that when it came to important issues such as contraception and disease prevention, consumers would be willing to pay more for merchandise that worked. Schmid’s condoms were more expensive than most, but they were standardized, and tests performed in the 1930s found them to be safe and reliable. Early commitment to product quality helped Schmid cultivate a loyal consumer base and brand-name recognition, assets crucial to his long-term success.”
On July 26, 2021, Rep. Zoe Lofgren (D-CA), chair of the House Immigration and Citizenship Subcommittee, introduced the LIKE Act, which would create a startup visa. The bill creates a temporary visa for foreign-born entrepreneurs who qualify and, according to a summary, “Allows the founder to apply for and receive lawful permanent residence if the start-up entity meets certain additional benchmarks that demonstrate the founder has a proven track record of success in business development.” The LIKE Act was included in the America COMPETES Act, which passed the House of Representatives in February 2022. A House-Senate conference committee will decide the fate of the measure.
Today, the lack of a startup visa costs America talent, according to the National Security Commission on Artificial Intelligence. In its final report, the commission’s members said the absence of a startup visa places the United States at a disadvantage compared to other nations in retaining and attracting foreign-born entrepreneurs. Economists note that many innovations are developed through entrepreneurship. Such was the case with Julius Schmid.
By 1927, Schmid employed 150 workers to make condoms in Queens (New York). He also began selling diaphragms for women. By 1947, his company was selling over 130 million condoms a year around the world. By 1950, the company sold half of the condoms manufactured in America.
“In 1938, in its first report of the birth control business, Fortune magazine pronounced Julius Schmid the undisputed king of the American condom empire,” writes Andrea Tone. “The formerly destitute German immigrant had achieved the American dream.”