Immigrants are twice as likely to form companies than American-born peers and have an outsized impact on U.S. economy.
While foreign-born entrepreneurs have an outsized impact on our economy, they also face an even more challenging road to success than their native counterparts, given the continued obstacle created by U.S. visa restrictions. Even with this hurdle, immigrants are twice as likely to form companies than American-born peers – they are on the founding teams of many technology and ventured-backed companies and have consistently created jobs in this country.
Mayors of cities seeking to grow their local economies are taking notice. By establishing programs and building local coalitions, mayors and other city officials seek to break through the visa barrier and leverage the skills and talent of entrepreneurial international students and graduates.
One such barrier is illustrated in a new study from Cornell University that found although foreign-born Ph.D. graduates with science and engineering degrees from American universities apply to and receive offers for technology startup jobs at the same rate as U.S. citizens, only half as likely to work at startups due the obstacles visa policies create for small companies seeking specialized, in-demand skills. The study finds that "because so many Ph.D. graduates in STEM fields are international – more than half in some disciplines – this creates an uneven playing field for startups competing with established companies to attract top talent."
This also creates an uneven playing field for cities competing to attract foreign-born entrepreneurs and the talent many of their startups need to scale.
The Global EIR program works with city leaders in partnership with local universities to connect international student entrepreneurs with visas, enabling them to accelerate business growth and development.
The Global Entrepreneur In Residence (Global EIR) program works with city leaders in partnership with local universities to connect international student entrepreneurs with visas, enabling them to accelerate business growth and development. Participating foreign-born founders give back by serving as "Global Entrepreneurs in Residence" at their universities, providing mentoring and advice to the local entrepreneurship ecosystem.
Craig Montuori, executive director of Global EIR, believes it’s a winning solution for everyone involved.
"Cities gain jobs and attract investment capital, universities attract more talented international students, and foreign-born entrepreneurs continue to grow their businesses," Montuori said. "Cities are best at creating the local coalitions necessary to make this all possible."
Mayors and city leaders from around the country learned about this economic development program at the Kauffman Foundation’s 2019 Mayors Conference. The Global EIR offers a solution with local coalitions at the center to fund the program, which typically consists of public and private organizations such as business schools, business organizations, foreign agencies and consulates, state and county agencies, and the local startup ecosystem builders.
Pittsburgh, Pennsylvania, is ripe for such a program. This city boasts a vibrant startup community and strong existing collaborations with its universities, which have large foreign-born populations.
"Our city wants to be welcoming and inclusive to all, including foreign-born entrepreneurs," said Annia Aleman, senior civic innovation specialist for the city of Pittsburgh’s Innovation and Performance department. "This kind of program could support our goal of being a unifying partner."
Like Pittsburgh, Detroit seeks to attract and retain foreign-born entrepreneurs because of the potential to bring substantial economic growth and talent to the city, so much so that the mayor established the Office of Immigrant Affairs.
"Detroit has been losing population, and we recognized that immigrant entrepreneurs exhibit the character and traits of entrepreneurs," said Roberto Torres, director of Immigrant Affairs and Economic Inclusion for the city of Detroit. "More entrepreneurs mean more jobs."
Working with the University of Michigan, and backed by a $1.5 million grant from the William Davidson Foundation, Global Detroit and its coalition support an EIR program that received 30 applicants in its first three months of operation.
Hartford, Connecticut, is a diverse city with a history of welcoming immigrants. Mayor Luke Bronin was well aware of the value of attracting foreign-born entrepreneurs to his city. He sees the EIR program as way to attract and retain immigrant entrepreneurs while leveraging their experience to mentor the local entrepreneurship ecosystem. In addition, he sees foreign-born entrepreneurs as key to his goal of making Hartford a global center in insurtech (using technology to disrupt the insurance industry), advanced manufacturing, and digital health business.
"We have a strong base of companies and accelerators in these industries that could benefit from experienced immigrant entrepreneurs," Bronin said.
Currently operating in five states, and at more than a dozen universities, Global EIR’s first four years of operation have generated results: 80 foreign-born entrepreneurs have participated, raising more than $450 million in capital and employing nearly 1,000 people. Two of the companies have been acquired, one for $600 million and one for $1 billion.