
"50% of firm founders [in Silicon Valley] are foreign born" - cwan
http://www.economist.com/blogs/freeexchange/2010/09/economic_growth
======
bpodgursky
Not especially surprising, nor damning of american-borns. Those with the
motivation, skills, and education to move abroad (to anywhere!) and start a
business are going to, on average, outperform the population which was born
there. Not because they are naturally better, but because they were self-
selected by being there in the first place.

Just like I'd be willing to bet that americans living abroad are
overrepresented as entrepreneurs wherever they happen to be living.

~~~
rubashov
> 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.

~~~
wheels
_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.

~~~
jseliger
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.

~~~
rubashov
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.

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gojomo
What gives these foreigners the right to come over here and make American
jobs? That leaves fewer jobs for native-born Americans to make!

~~~
timr
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.

~~~
hackerdude
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.

~~~
timr
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.

------
patrickgzill
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...](http://sanjose.bizjournals.com/sanjose/stories/2003/09/01/daily41.html)

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)

~~~
xelipe
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?

------
_delirium
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.

------
ww520
Immigrants by self-selection are already risk-takers, that fits well as a
trait to be an entrepreneur.

~~~
osopoderoso
Immigrants are not only risk-takers, they are mainly avoiding poverty and
looking for better conditions.

~~~
sbowles
On behalf of my fellow Canadians in the US, I can safely say most of us are
simply opportunists.

------
pkaler
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...](http://www.nytimes.com/2010/09/10/opinion/10brooks.html?_r=1&ref=columnists)

 _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.

------
qasar
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.

~~~
sloak
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.

~~~
qasar
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.

------
djhworld
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.

------
helmut_hed
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_

------
achille
Heck, 50% of this entire industry is foreign born.

~~~
hugh3
I hear that 95% of the entire world is foreign-born!

~~~
acon
Is that really true? I would guess most people live in the country they were
born in.

~~~
alphaoverlord
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.)

------
MC27
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.

~~~
usaar333
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).

~~~
alextgordon
Yes but percentage of CS students actually finish with low debt? I would
imagine it's lowish.

~~~
usaar333
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.

------
johngalt
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.

------
IdeaHamster
Maybe it's time to rerun this poll:
<http://news.ycombinator.com/item?id=688053>

~~~
mahmud
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%.

------
runT1ME
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.

~~~
HectorRamos
How is that different from anyone else not born in the US? They also have a
'home' and established business relationships.

------
kd0amg
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)?

~~~
paul_mara
The article mentions that the H1-B is a path towards citizenship; citizen or
green-card holders can then become founders.

~~~
hippich
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.

~~~
kd0amg
So you could make arrangements to be a cofounder and then have your founding
company sponsor your visa?

~~~
keeptrying
This is really really difficult. I know of only 2 people who have ever managed
to do this.

~~~
trustfundbaby
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).

------
csomar
How did those founders get Visa to come here and build their firm? Did they
all start with 1 million dollar?

------
vbsredlofb
What really surprises me is the other half. Americans? Who could have thought?

------
known
What % of jobs Americans create outside USA?

