"50% of firm founders [in Silicon Valley] are foreign born"(economist.com)
economist.com
"50% of firm founders [in Silicon Valley] are foreign born"
http://www.economist.com/blogs/freeexchange/2010/09/economic_growth
55 comments
I don't think it's damning of American-borns, I think it's actually the opposite. As a foreign-born founder of a US startup, I wish my home country was as attractive as the US for starting my business. I think America should be proud of its capability to attract top talent.
It's also possible that due to discrimination in the hiring market, their opportunity cost is lower.
That's not only true for entrepreneurs, but anyone who excels in their field. Here in Europe a lot of Americans and other foreigners stand out because they were chosen for their skills. Otherwise they wouldn't be here. The Europeans I know in Silicon Valley didn't go there on their own accord, they were invited to come.
> Not especially surprising, nor damning of american-borns
I disagree. I wouldn't be sanguine about it. Previous major waves of technical innovation were lead by well established Americans. Something has changed.
A plausible hypothesis (not that I'm convinced) is that high immigration has driven down wages in technical professions. So native born Americans are less inclined to bother.
I think it's important to point out that two American eras of high growth and prosperity had essentially zero immigration. From 1921 to 1965 immigration was practically nothing. This was a period of extreme American innovation.
I disagree. I wouldn't be sanguine about it. Previous major waves of technical innovation were lead by well established Americans. Something has changed.
A plausible hypothesis (not that I'm convinced) is that high immigration has driven down wages in technical professions. So native born Americans are less inclined to bother.
I think it's important to point out that two American eras of high growth and prosperity had essentially zero immigration. From 1921 to 1965 immigration was practically nothing. This was a period of extreme American innovation.
From 1921 to 1965 immigration was practically nothing.
Uhm, what? Perhaps in raw numbers, but the world wars drove vast numbers of european intellectuals to the US.
Uhm, what? Perhaps in raw numbers, but the world wars drove vast numbers of european intellectuals to the US.
I was just going to say almost exactly this: it might be worth reading Richard Rhodes' The Making of the Atomic Bomb, in which he points out how many of the essential scientists and engineers working in aspects of the Manhattan Project were Europeans. Some of the most essential figures, like Leo Szliard (sp?), were.
I dare say a handful of physicists and chemists did not have major bearing on the US economy, after their accomplishment of needlessly incinerating a bunch of japanese.
He's "merely" forgetting that von Neumann, von Karman, and Andy Grove all came from Hungary.
I dont think its got anything to do with wages. Especially for founders of technology/science-based companies.
Rather I think Americans dont take tough courses in college - ie science/technology courses. How many computer science (for eg:) MS courses even have Americans enrolled in them?
Americans take it easy in college. Heck, if I'd been born here I'd have done the same. :)
Rather I think Americans dont take tough courses in college - ie science/technology courses. How many computer science (for eg:) MS courses even have Americans enrolled in them?
Americans take it easy in college. Heck, if I'd been born here I'd have done the same. :)
> Americans dont take tough courses in college - ie science/technology courses
... because an army of H1Bs and green cards have driven down wages and thus the incentive to pursue science & tech careers? Seems at least plausible.
... because an army of H1Bs and green cards have driven down wages and thus the incentive to pursue science & tech careers? Seems at least plausible.
What gives these foreigners the right to come over here and make American jobs? That leaves fewer jobs for native-born Americans to make!
That's a lot of points for an intensely cliched piece of sarcasm.
Here's a clue: You're an artist with real ambition, so where do you go? Paris or New York. On arrival you notice the huge percentage of aspiring artists who are imports from all around the world. What does this mean?
1. Paris and New York are incapable of art and depend on foreigners.
2. Paris and New York have developed art scenes of such strength that they are known world-wide as the places to go if you have ambition.
#2, obviously. Well, not obvious if you're making cheap political shots, but whatever. SV is known all over the world as the destination for ambitious entrepeneurs and that has mathemetical ramifications of no polical meaning.
Here's a clue: You're an artist with real ambition, so where do you go? Paris or New York. On arrival you notice the huge percentage of aspiring artists who are imports from all around the world. What does this mean?
1. Paris and New York are incapable of art and depend on foreigners.
2. Paris and New York have developed art scenes of such strength that they are known world-wide as the places to go if you have ambition.
#2, obviously. Well, not obvious if you're making cheap political shots, but whatever. SV is known all over the world as the destination for ambitious entrepeneurs and that has mathemetical ramifications of no polical meaning.
Yeah, that's funny and all...but I'm rather embarrassed for HN's analytical skills right now.
Fifty percent of firm founders are foreign-born you say? OK. What percentage of valley residents are foreign-born? Or, hey...what percentage of foreign-born residents outside the valley start businesses. Without answers to these questions, the 50% stat is just a sound-bite.
Fifty percent of firm founders are foreign-born you say? OK. What percentage of valley residents are foreign-born? Or, hey...what percentage of foreign-born residents outside the valley start businesses. Without answers to these questions, the 50% stat is just a sound-bite.
As far as I can tell, the report doesn’t say 50% of founders are foreign-born. Rather, it says (middle of page six) that 50% of tech companies have at least one foreign-born founder. That’s very different. To use a very simple example, if you had 100 startups, each with three founders, 50 of which had 3 native-born founders and 50 of which had 1 foreign-born and 2 native-born founders, you’d have 50% of companies with a foreign-born founder, but only 17% of the founders would be foreign-born.
The question that needs to be answered is: do immigrant technology workers found technology startups at a higher or lower rate than native-born technology workers? Surprisingly, I’ve never seen that question addressed. I’ve seen articles that imply an answer, but once I dig a bit it always seems that the data doesn’t actually justify the implied conclusion.
The question that needs to be answered is: do immigrant technology workers found technology startups at a higher or lower rate than native-born technology workers? Surprisingly, I’ve never seen that question addressed. I’ve seen articles that imply an answer, but once I dig a bit it always seems that the data doesn’t actually justify the implied conclusion.
Good point. I hadn't noticed that -- it makes the argument even weaker.
Nearly everyone in this thread is taking for granted that foreign workers are more entrepreneurial, and using this piece as some sort of external validation of that view. But the article is just regurgitating a sound-bite. Without context, there's no reason to believe that the cited statistic implies a meaningful conclusion.
Nearly everyone in this thread is taking for granted that foreign workers are more entrepreneurial, and using this piece as some sort of external validation of that view. But the article is just regurgitating a sound-bite. Without context, there's no reason to believe that the cited statistic implies a meaningful conclusion.
What percentage of people who live in SV are foreign-born?
According to San Jose Business Journal, in 2003 36.5% were foreign born. http://sanjose.bizjournals.com/sanjose/stories/2003/09/01/da...
I guess/estimate if you adjusted for those native-born who are either working at family businesses already (2nd or later generation of a family owned business), or are following their parent's lead on a trade or profession (son of lawyer becoming a lawyer, daughter of ob-gyn becoming a doctor), you would find that the quoted stats are not very important or relevant.
(just adding another data point to the discussion)
According to San Jose Business Journal, in 2003 36.5% were foreign born. http://sanjose.bizjournals.com/sanjose/stories/2003/09/01/da...
I guess/estimate if you adjusted for those native-born who are either working at family businesses already (2nd or later generation of a family owned business), or are following their parent's lead on a trade or profession (son of lawyer becoming a lawyer, daughter of ob-gyn becoming a doctor), you would find that the quoted stats are not very important or relevant.
(just adding another data point to the discussion)
Good question. In SV there are cities with a foreign born population that is well above 50%. Another question I would ask, what is the percentage of SV founders that are Native Californians?
I'm not sure this is even an SV-specific phenomenon; small-business founders in the U.S. have long been disproportionately foreign-born. I wonder what the statistics would be for restaurant owners.
Immigrants by self-selection are already risk-takers, that fits well as a trait to be an entrepreneur.
Immigrants are not only risk-takers, they are mainly avoiding poverty and looking for better conditions.
On behalf of my fellow Canadians in the US, I can safely say most of us are simply opportunists.
Click through to the David Brooks NYTimes article. The real story here is that there is a mismatch between supply and demand.
http://www.nytimes.com/2010/09/10/opinion/10brooks.html?_r=1...
One of the perversities of this recession is that as the unemployment rate has risen, the job vacancy rate has risen, too. Manufacturing firms can’t find skilled machinists. Narayana Kocherlakota of the Minneapolis Federal Reserve Bank calculates that if we had a normal match between the skills workers possess and the skills employers require, then the unemployment rate would be 6.5 percent, not 9.6 percent.
The Economist article expands upon this thesis for the high-tech industry. Just as there aren't enough skilled machinists, there also are not enough skilled founders in the domestic market.
One of the perversities of this recession is that as the unemployment rate has risen, the job vacancy rate has risen, too. Manufacturing firms can’t find skilled machinists. Narayana Kocherlakota of the Minneapolis Federal Reserve Bank calculates that if we had a normal match between the skills workers possess and the skills employers require, then the unemployment rate would be 6.5 percent, not 9.6 percent.
The Economist article expands upon this thesis for the high-tech industry. Just as there aren't enough skilled machinists, there also are not enough skilled founders in the domestic market.
Although I don't think being an immigrant is a defacto stamp of approval of any sorts, the adversity you face as an immigrant kid does change you.
OR being an outcast of any sort.
The analogy I think of is you're brain is like a clay pot being formed in your youth. Hard hands (hard experiences) either create something amazing or destroy you. And then your teenage years cure you into that state.
OR being an outcast of any sort.
The analogy I think of is you're brain is like a clay pot being formed in your youth. Hard hands (hard experiences) either create something amazing or destroy you. And then your teenage years cure you into that state.
I think it is incorrect to assume an immigrant kid faces adversity. Most of the emigration to SV is from well-off families with well-adjusted kids and they settle in well-off areas.
Perhaps SV is unique but vast majority American immigrants certainly do not come from 'well off families' and live in 'well off areas'.
But thats all beside the point I was getting at - i'm saying facing significant adversity creates a unique type of person.
But thats all beside the point I was getting at - i'm saying facing significant adversity creates a unique type of person.
This is really just a symptom of the magnetism of Silicon Valley.
To put it into context, here in the UK there is no where really quite like it, in terms of supporting tech startups and harbouring a community that has such prestige and heritage from over the years. From our perspective Silicon Valley is always going to be seen as having greener grass than ours.
To put it into context, here in the UK there is no where really quite like it, in terms of supporting tech startups and harbouring a community that has such prestige and heritage from over the years. From our perspective Silicon Valley is always going to be seen as having greener grass than ours.
As a tech guy who has repeatedly been hired by companies founded or run by Indian immigrants, I have only this to say about the immigration of foreign entrepreneurs: more, please
Heck, 50% of this entire industry is foreign born.
I hear that 95% of the entire world is foreign-born!
Is that really true? I would guess most people live in the country they were born in.
I can't tell if you are being sarcastic, but I think the OP is talking from the perspective of an American citizen. America has 4.5% of the world population (according to Google.)
I'd imagine immigrants aren't so laden with debt, so they have more freedom. Many countries don't charge their native students for higher education, those that do, are often subsidised and repayments are linked to their earnings. So if you earn a small salary, you pay nothing.
Right, debt is the burden that keeps all americans from becoming job creators. I am scared to think of what would happen if I don't repay my student loans.
I don't imagine this being that large of problem this is with majors like computer science. By going to a public school and interning during the summer (maybe even part time during the year), you can easily come out debt free (if not positive).
Yes but percentage of CS students actually finish with low debt? I would imagine it's lowish.
I'd love to see the numbers.
At my alma matter (Berkeley), I imagine it was quite high. Not so much due to the high paying internships (which do help limit the burden), but because CS students on average tended to come from quite affluent households.
At my alma matter (Berkeley), I imagine it was quite high. Not so much due to the high paying internships (which do help limit the burden), but because CS students on average tended to come from quite affluent households.
This is great news. People are drawn from the world over to SV to build a business. Makes me wonder if we relaxed immigration rules for entrepreneurs we could push this even further.
The idea that we could draw in more founders just by letting them come here... seems like an easy win. All those startups and all the high skill workers they'd attract. Imagine the synergy of all that talent in one place. It could be the next renaissance.
The idea that we could draw in more founders just by letting them come here... seems like an easy win. All those startups and all the high skill workers they'd attract. Imagine the synergy of all that talent in one place. It could be the next renaissance.
Maybe it's time to rerun this poll: http://news.ycombinator.com/item?id=688053
169 out of 531 total were first-generation, foreign born immigrants (much like myself :-)
That makes it 32% of all HNers who bothered to vote.
If you count those whose parents are immigrants, it jumps up to 52%.
That makes it 32% of all HNers who bothered to vote.
If you count those whose parents are immigrants, it jumps up to 52%.
People who are born in the US probably have less incentive to leave 'home'. High probability that they've developed business relationships and a network of people in their hometown or place of schooling, giving them an advantage that is taken away if they move to Silicon Valley.
How is that different from anyone else not born in the US? They also have a 'home' and established business relationships.
The H1-B thing seems like a bit of a non-sequitur to me. I thought H1-B was for getting hired to a specific position (i.e. not for founders)?
H1b is just a start. Once you get there, you can get new opportunities. It's way harder to be hired by someone if you are on tourist visa.
The article mentions that the H1-B is a path towards citizenship; citizen or green-card holders can then become founders.
you can be founder on h1b/tourist visa, but you can't work for this company and be paid unless company you (co)founded will hire you.
So you could make arrangements to be a cofounder and then have your founding company sponsor your visa?
Technically, yes. But since it's a way to do fraud, DHS makes this way hard. But still, if you are not getting paid, you can volunteer for this company.
Also, you are free to be paid as long as you are not resident of united states. This is where tourist visa is better.
Disclaimer: I am not a immigration lawyer and all of this is just my own opinion =))
Also, you are free to be paid as long as you are not resident of united states. This is where tourist visa is better.
Disclaimer: I am not a immigration lawyer and all of this is just my own opinion =))
This is really really difficult. I know of only 2 people who have ever managed to do this.
Where there is a will there is a way.
You need a good lawyer, an investor willing to commit $200,000 (you might be able to get away with less) to the business so your cofounder can file for the visa for you, and the willingness to put your future in the hands of the cofounder, since they'll have ownership of the company on paper until you get your green card (You need a separate business agreement governing the business setup after you become a citizen)
Also do yourself a favor and get a Master's degree so you can file in the EB2 category (speeds up your green card process).
You need a good lawyer, an investor willing to commit $200,000 (you might be able to get away with less) to the business so your cofounder can file for the visa for you, and the willingness to put your future in the hands of the cofounder, since they'll have ownership of the company on paper until you get your green card (You need a separate business agreement governing the business setup after you become a citizen)
Also do yourself a favor and get a Master's degree so you can file in the EB2 category (speeds up your green card process).
How did those founders get Visa to come here and build their firm? Did they all start with 1 million dollar?
What really surprises me is the other half. Americans? Who could have thought?
What % of jobs Americans create outside USA?
Just like I'd be willing to bet that americans living abroad are overrepresented as entrepreneurs wherever they happen to be living.