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Study: Immigrants Founded 51% of U.S. Billion-Dollar Startups
- deleted 11y ago[deleted]
- mchahn 11y agoSo those immigrants are taking all that VC money away from me! (Kidding, kidding, kidding, just a Trump joke).
- devgutt 11y agomulti-level-delusional
- chris_wot 11y agoDamned Australians.
- klipt 11y agoFun fact: the E-3 visa is basically an H1-B, but with a separate quota, for Australian citizens only. It was created by Bush to thank Australia for helping the US in the Iraq war.
- samhoggnz 11y agoAnother key difference -with an E3 there's no path to a green card. A number of friends have had to change to L1/H1 visas because of this limitation.
- klipt 11y agoIt's a grey area, plenty of people have gone direct from E3 to green card with no problems. But yes getting H1 first is theoretically safer ... if you can, given the lottery.
- force_reboot 11y agoAnd yet this is what the majority of people in on HN are arguing here. So you have to ask, why is a certain viewpoint laughable when applied to illegal immigrants from South America, but reasonable when applied to H-1B visas?
- netheril96 11y agoBecause their interests are not hurt by illegal immigrants from South America, but hurt by legal immigrants on H-1B visas.
- staunch 11y agoThese are not the downtrodden masses. Immigrant does not mean poor. These are wealthy upper class people coming to the most logical place to create a successful technology company, because they can afford to do so. Poor people are usually stuck wherever they are. Investors in Silicon Valley care a lot about status and pedigree. A foreigner that can afford elite credentials is far more likely to get funding than a poor local. And of course H1B visas drive down wages. This is basic supply and demand.
- ra1n85 11y agoAre you sure H1B visas are relevant here? I would imagine EB-5 (investment) visas would be the more common route for upper class immigrant entrepreneurs coming to the US.
- cft 11y agoThey are more like upper-middle classes (not upper classes).
- ausjke 11y agoexactly, many of them are well educated and trained indeed.
- GuiA 11y agoNot quite so sure. I was a startup cofounder (never made it to billion dollar though :), and came to the US via grad school on an F1 visa, which then morphed into an H1B, and am now in the process of getting a green card. I know this is a very common path. Regarding the class thing: my grandparents were blue collar workers who never went to high school, my parents were engineers.
- chrisper 11y agoIANAL, but you cannot legally work on your own startup if you are on H1B
- pandaman 11y agoThe article is advocating for increasing H1-B caps. I wonder what does H1-B (a non-immigrant visa, which does not allow running your own business) has to do with immigrants founding billion dollar startups other than them using it to acquire cheap labor?
- belltaco 11y agoBecause many of them came to the US to study because of being able to work here through the OPT/H1/GreenCard/citizen route. Same with many top professors, researchers and tech execs like Nadella, Gundotra, Pichai etc.And many people on this list too like the inventor of USB etc. https://en.m.wikipedia.org/wiki/List_of_Indian_Americans https://en.m.wikipedia.org/wiki/List_of_Indian_Americans
- pandaman 11y agoThe three people you listed are not known for founding billion dollar startups. They are known as employees of Google and Microsoft (unless you meant somebody else with the same last names as Google and Microsoft CEO and Google's former VP of engineering).
- agmohit01 11y agoAlright. Let me list down some immigrants who came here on H1B visa. 1. Jyoti Bansal - Founder of AppDynamics The guy in the above mentioned article was on H1B. 2. Kevin Systrom - Cofounder of Instagram was on H1B visa. 3. Jay Scaler - Founder of ZScaler an unicorn, was on H1B visa 4. Vinod Khosla - Founder of Sun Microsystems and well known VC was on H1B visa initially Will list down some more in some time.
- foobarqux 11y ago> 2. Kevin Systrom - Cofounder of Instagram was on H1B visa. I don't think that's correct.
- 11y ago
- Kenji 11y agoAccording to the study, Mr. Bansal couldn’t leave his job to start a new company because it was unclear if he’d be able to keep his H-1B status. For 7 years. What a lock-in. And during that time, your employer can probably abuse you and freeze your salary, knowing exactly that your stay depends on that visa and you have a hard time leaving. Another point on immigrants. The US does it right: It causes brain-drain in other countries and actually takes in skilled workers. I can guarantee you that the kind of mass immigration central Europe is experiencing right now won't lead to an array of startups.
- shas3 11y agoFunnily, due to country quotas that 7-9 yr wait on employment-based green cards is almost exclusively Indian problem.
- klipt 11y agoEven for non-Indians it takes 2-3 years thanks to USCIS's general bureaucratic inefficiency. Even a naturalized American who loses their certificate of naturalization and applies for a replacement copy has to wait 6 months for USCIS to issue a single piece of paper!
- hibikir 11y agoToday, sure. 5 years ago, the EB2 and EB3 quotas for all other countries were almost as long, but this changes over time. For instance, in 2007, the line was 5 years after labor certification, so, in practice, about 6 years for everyone. Nowadays that to get an H1B you need to go through a lottery, the big Indian outsources are increasing their percentage of H1Bs, making the problem both harder for India, and easier for the rest of the world. Instead of waiting 5 or 6 years like I did, now you probably can't stay in the US, but if you can, the green card is easier. It's a downright bizarre situation.
- ausjke 11y ago7 years is a lucky thing, I saw many 9+ years after 911, however if you have a nice PhD degree it could be much faster, the rest just have to wait and wait.
- Dr_tldr 11y agoIt's no secret that the continuing economic dominance of the US is not due to a post-WW2 windfall or the unique capabilities of Americans, but more to the ability of the US to attract and retain the very best, and then subsequently give them unique opportunities. Few nativists are opposed to the best and the brightest (and the already-wealthy) coming to the US in very, very small numbers, but what they don't realize is that it's pretty much impossible to tell in advance who's going to be a winning lottery ticket.
- tosseraccount 11y ago"few" ? http://www.cnbc.com/id/100593528 http://www.cnbc.com/id/100593528 "Yet when Americans are asked about raising or lowering the number of immigrants coming into the country, only a small portion favor higher immigration levels and a very sizable plurality favor lower levels. A 2006 study by the Pew Hispanic Center, for example, found that 40 percent of those surveyed said legal immigration should be reduced and just 17 percent favored an increase. (Apparently Pew stopped asking that particular question after 2006.) This chart from Pew shows that as recently as 2012, 69 percent of those surveyed agree that "we should restrict and control people coming to live in our country more than we do now." Americans are divided over immigration. The lobbyists in Washington? Not so much."
- someguydave 11y ago>but what they don't realize is that it's pretty much impossible to tell in advance who's going to be a winning lottery ticket. Agreed, it's difficult to tell in advance. One way of skewing the odds in favor of the US is to just sell visas to the highest bidder.
- hodgesrm 11y agoHow does that help get people like Andy Grove (from Intel)? As I recall he was penniless when he made it to the US in the 1950s.
- someguydave 11y ago
- tim333 11y agoThey could do with a startup founder visa really. Maybe allow people to hang out and launch companies for a year or 2 and allow conversion to a long term visa if they employ a few Americans. Bit like a relaxed version of the E2 visa. Edit - I read to the bottom of the article and see they tried to bring something like that in with the "EB-JOBS Act of 2015" which didn't get through the political system.
- jbotttt 11y agoThis already exists in the EB-5 visa[0] assuming you start with .5 million funding. You get to stay forever too. [0] https://en.m.wikipedia.org/wiki/EB-5_visa https://en.m.wikipedia.org/wiki/EB-5_visa
- tinco 11y agoI'm not a U.S. citizen, and obviously one day I hope to be one of those U.S. Billion-Dollar startup founders and I would appreciate a VISA if it would help me achieve that, but there's something shaky with the premise here. Why does the U.S. need to depend on the ~80.000 odd first order immigrants per year to generate that amount of wealth. Couldn't the U.S. somehow draw those ambitious out of its current population? What if people could 'emigrate' from Detroit to California? They'd basically be refugees from a low-opportunity environment as well. Or is it not the fact that they came from a low-opportunity environment, but rather that they came like Bill Gates from the tender love and care of rich/succesful parents, and being born abroad was just a small hurdle?
- throwaway_xx9 11y ago> Why does the U.S. need to depend on the ~80.000 odd first order immigrants per year to generate that amount of wealth. The U.S. doesn't need them - Silicon Valley was created by Americans. However, companies have tasted what mass immigration does to engineering salaries (stagnant since 2000) and labor mobility (almost none for H1B's) and are as addicted as heroin addicts.
- dominotw 11y ago>companies have tasted what mass immigration does to engineering salaries (stagnant since 2000) Do you happen to know if there were studies done to link these two?
- falsestprophet 11y ago"These 44 companies, the study says, are collectively valued at $168 billion and create an average of roughly 760 jobs per company." Firstly, that's 33,000 jobs or about 0.0003% of the US workforce, so hardly the backbone of the economy. Secondly, the H1B program, the subject of the article, is not an immigration program but a guest worker program. Generally, H1B workers leave the country and don't go on to start companies because the visa is limited to six years.
- dominotw 11y ago>Generally, H1B workers leave the country and don't go on to start companies. Do you have any stats on this or is it just a gut feeling?
- YZF 11y agoVery anecdotal but all my friends who got to the US on an H1B have moved on to green card and citizenship. I would imagine this is quite common as it is a "dual-intent" visa. I think it would be better for immigrants and Americans if workers got a permanent residency immediately status rather than a temporary work visa tied to a given company.
- falsestprophet 11y agoThe largest users of H1Bs, the big outsourcing firms like Tata and Infosys, don't sponsor permanent residency. The two largest ones had something like 13,000 new H1Bs in 2013 and sponsored 7 people for permanent residency that year.
- smilekzs 11y agoThey are also the main abusers of H-1B, universally hated by _real_ tech companies and university graduates (applying for one).
- hibikir 11y agoNope, the H1B visa is THE immigration program. Every university will tell you that. The route used to go like this: Studying in an American university will get you an F1 visa, which gets you either a first job or an internship. Then, if you are any good, the only sensible way for your employer to retain you is to file for H1B. Back when I did it, it was really easy to get it (as opposed to today's 1/3 lottery). At that point, you can say that you want a green card. Nobody is going to be crazy enough to sponsor someone for a Green Card if they aren't working there already, if just because it's a relatively long process in the best of cases, and many years the worst. So we get H1Bs so that companies will be OK sponsoring us. Once your green card process is pending, the visa stops being limited: You just have to wait as many years as it might take to get to the front of the green card queue. Then you will be approved, and become a permanent resident. Today, getting the H1B is actually HARDER than getting the green card, but getting one first is pretty much mandatory due to the delays. This is what makes the H1B the main road in. If you look at the employment based green cards handed out every year, a very large percentage comes from H1s, or maybe L1s(which only works in a company that has an international subsidiary) There are H1Bs that go back home, but they are those that get laid off at the wrong time, so they give up on the green card process.
- convexfunction 11y ago1. Many want it to be true that it's an objectively good idea to allow more immigration, or for there to be a broad consensus that more immigration is objectively good, or for there to be more ammunition to conduct moral posturing upon the outgroup when the outgroup has negative valence about immigration, or maybe two or all three. (I don't particularly disagree, immigration is fine.) 2. One great way to accomplish all of those is to create an association between "immigrant" and "success" or "innovation" in people's minds. 3. People gloss over the difference between P(A|B) and P(B|A) all the time. If you can show that P(B|A) is surprisingly high, and there's sufficient motivation to do so, people will instead think something much more like "A and B are associated" than "A often implies B though not at all necessarily the converse". 4. So, just show that {thing you want people to have positive valence about} is overrepresented in {tiny set of things with positive valence}. This will probably be easy, since there are lots of tiny sets of things with positive valence. This strategy is far more used in the negative case -- "people who do bad thing Y are often from group X, don't concern yourself with the base rate of bad thing Y among all members of group X" -- but either way it's very effective and very insidious.
- ekianjo 11y agoThere aren't many Billion Dollar startups out there (44 as said in the article) so the apparently precise percentage (51%) is slightly misleading (base size is small so not so representative). If they had looked at, let's say, 500M startups, the actual figure would have been more telling.
- sonabinu 11y agoMost CS students want to come to the U.S. from around the world because the CS Rock Stars are here! Where else are you able to go to a meet up and strike up a conversation with the person who wrote popular software you admire? How often do you get to do that in another country? The immigrants want to start companies here because there are success stories here - especially immigrant success stories. I love the CS classes here ... I love the passion that students show, I love the side projects people are willing to invest free time in ...
- deleted 11y ago[deleted]
- nativedude 11y agoWe're talking theses United States right?! So unless you're talking 'bout Native Americans then 99%+ of all companies since 1776 have been created by Immigrants. Think about folks!
- notworthmyjob 11y agoIf so, how did us Europeans "immigrating" to the US work out for the Native Americans?
- krapp 11y agoIf you want to be that pedantic, Native Americans are immigrants as well, they just happened to immigrate thousands of years ago.
- abiox 11y agonative americans immigrated over the landbridge, all those year ago, no? ostensibly they're just the first immigrants. :-)
- nickpsecurity 11y agoWhat was thd class of the inmigrant? Where did they go to school? And were those that funded them immigrants? Then the big picture emerges.
- eru 11y agoI don't know about the US, but in Britain a lot of university funding comes from charging foreigners an arm and a leg to study there.
- eva1984 11y agoNot on a serious note...this title could be phrased as 'With no immigrants flooding, americans will found 100% of U.S. Billion-Dollar startups'
- BWStearns 11y ago"Immigrants Stealing 51% of Best Paying Jobs" This game is fun!
- frandroid 11y ago> These 44 companies, the study says, are collectively valued at $168 billion and create an average of roughly 760 jobs per company in the U.S. $168B divided by 760 employees: $220M of value created per job. If there's no error in the numbers, that means that employees at these startups are tremendously underpaid, in spite of probably making above-market salaries.
- gjkood 11y agoIsn't the number 760 employees PER company? That would make the total as 760*44=33,440 employees.
- pavpanchekha 11y agoNot quite; 760 employees per company, but 168B overall. That makes for $5M of value per job. $5M is approaching the compensation of most of the average employee here.
- chetanahuja 11y agoClicked this expecting to see much breast-beating about H1B and "driving down wages". Top comment has this: "And of course H1B visas drive down wages" Wasn't disappointed. Never change hacker news.
- jza00425 11y agoxenophobia is big part of this myth. in the future, mail wife will be the only way to get into US
- whybroke 11y agotldr; WSJ want to raise H1B cap and cherry-picks/mis-represents data to justify that.
- dalke 11y agoIn a slightly older thread concerning this topic, at https://news.ycombinator.com/item?id=11306290 https://news.ycombinator.com/item?id=11306290 I made some objections to this analysis. I think there's a fundamental problem in how to interpret this analysis. It says that a company is founded by an immigrant if there is at least one immigrant founder. This means that if 1 of 10 founders is foreign born, then it classified as immigrant founded. An aggregate calculation like this is very likely to give a number which is higher than the more important number, the over- or under- representation of immigrant founders relative to the immigrant population. For example, if every company has 10 founders, and every company has 1 immigrant founder, then by the given definition, 100% of the companies would be founded by an immigrant. However, only 10% of the founder population would be an immigrant. As immigrants make up about 13% of the US population, this would mean that immigrants would be proportionally less likely to be founders of $1B valuated startups than non-immigrants. Curiously, and I believe significantly, the study does not give this population information, and it makes it difficult to determine that ratio. I did not find an explicit count of the number of immigrant founders. Table 4 has a list of all of the name, and Table 3 has a count of immigrants from a given country, so it's possible to figure this out. I am perturbed that the first contains 60 people and the second 61. Perhaps I have miscounted, but I believe there is an error in the report. (I double checked the report by searching for "60" or "61", but found no explicit total of the number of immigrant founders.) I did not find an explicit count of the total number of founders, which means I have to compute that myself from the list of companies. I did not find an explicit list of companies, which means I have to go to the original WSJ data source. Which I did, though my count was off by one from the report's count. It would have been much better if the report included the explicit list of companies and founder counts. I took the current WSJ list of 106 companies and picked a few in the top, middle, and bottom range. (Statistical sampling would have been better, I know.) I found founder counts of 65 of them before tedium kicked in. I found 161 founders. This gives an estimated total founder size of 161/65x87 = 215.5, and implies that about 60/215.5 = 28% of founders are immigrants. This number, while twice as large as expected from the general immigrant population of the US, is also around half of the eye-catching 51%. The next step would be to do a sensitivity analysis to give an idea of error bars. I do not know anything beyond basic statistics, but will point out that 60 is a very small number compared to the number of foreign visa, and hardly representative. Speaking of statistics, while 28% is twice as large as 13%, there's likely also a form of p-hacking, or "garden of forking paths" going on. With enough sampling, you will be able to find very unrepresentative subgroups in your data. Why was this population of $1B startups chosen? Do the results change with $2B? Do they change for companies that go public? For a more specific example, last year there was an analysis going around which pointed out that "Most high tech companies are founded by founded by First/2nd gen immigrants". This is definitely in the same vein, though with different measures. See https://news.ycombinator.com/item?id=9085970 https://news.ycombinator.com/item?id=9085970 for my observation that this is almost exactly what you would expect given the immigrant population in the US. Since I can point to two reports related to the topic, how many more negative and thus unpublished correlations are there? Finally, the report includes the suggestion that diversity among the founders helps improve the success of the company. If that were the case, then should we not exclude companies where the all founders are from the same foreign country, as in Nutanix where all three founders are from India?
- hackaflocka 11y agoPretty sure white immigrants like Elon Musk are not who Donald Trump and his followers are talking about.
- SCAQTony 11y agoImmigrants are awesome and unfortunately exploited but don't you think an orderly immigration is far more effective than having borders Zerg rushed?
- known 11y agoNever let your inferiors do you a favor. It'll be extremely costly;
- vpkaihla 11y ago49% of US billion-dollar startups were founded by native americans?
- Nutmog 11y agoThe arbitrary criteria for deciding what companies to include shows they could have just searched for one (valued at over $1B at 2016-01-01 and not publicly traded) that gives the most favorable result. Why $1B? Why not $10B, $100M, or $1 million? Why 2016? Why not 2015 or any time in the past decade or two? Why not listed companies? Is that so they can call them "startups", or is it because $1B+ listed companies are mostly founded by American born people? I couldn't find any mention of their methodology for selecting criteria in the linked report. Without that, the only conclusion seems to be "water is wet". This doesn't look like science. It looks like politics and is inherent dishonesty.
- mizchief2 11y agoI wonder how many of those illegally crossed the boarder with Mexico.
- jcuga 11y agoWhat good is a billion dollar startup if it pays little US tax, and only employs one or two hundred high paying jobs? A 100 Million dollar company typically employs just as many high paying jobs and may pay more US tax than a lot of these tech companies. Also, a lot of these tech companies that are "shaking up" industries are profitable at the expense of other more traditional businesses (For example: AirBnB taking business from Hotels, Uber from taxi services, etc). So bringing in more Billion dollar unicorn startups may not be the best thing for a country.
- wallawe 11y ago> What good is a billion dollar startup if it pays little US tax? Your line of thought implies that the only way a company can add value to the economy is through employment and taxes. You only need to look for a couple seconds at the mess in DC to glimpse how much money from taxes is wasted, not to mention allocated towards ethically questionable activities (drones, domestic spying, wars, etc). That's for another conversation. In the case of airbnb, you are taking money from larger more established corporations (hotel chains) and giving it to homeowners who have a spare bedroom or are away for the weekend. You are also providing a wider range of pricing options for consumers. So the company contributes to the economy in those ways as well, not just through employment and taxes. > Also, a lot of these tech companies that are "shaking up" industries are profitable at the expense of other more traditional businesses These companies take business from traditional companies because they provide more value. Keep in mind the whole point of a company to fulfill a need. I would say that it's not really up to you or anyone other than consumers to decide if it's a good thing or not that these companies succeed. Competition is always a good thing for consumers.
- flurben 11y agoThe study found that 51 percent of the country’s $1 billion startup companies had at least one immigrant founder. To say that "immigrants founded 51% of U.S. billion-dollar startups" seems a bit misleading to me.
- thetruthseeker1 11y agoNo matter how you feel about the whole legal immigration thing, If it is true that immigrants who form significantly less than 51% of the working population found 51% of the startups there is an interesting insight statistically speaking (This is not normal, but good) May be there needs to be a distinction between the kind of immigrants who go on to found startups vs the one who come to take low paying jobs. May be create different visa category for each. Encourage one discourage another(limiting it), but that doesn't mean that every person who comes under 1st category starts a company or everybody who comes under the second category doesn't start a company. I see it as math, maximize one function and minimize the other.