More than half (55%) of U.S. startups worth $1 billion or more have at least one immigrant founder. Foreign-born entrepreneurs have historically played a key role in driving innovation and job growth in North America and their efforts are critical in creating a more resilient economy.
Immigrant-founded companies are key to growth
With more than 4.3 million business formation applications coming in last year — and the likelihood that number will be even higher this year — there’s hope the 40-year downturn in entrepreneurship is coming to an end. But we need foreign-born business owners to help us reverse course.
From Pfizer to Uber, many of today’s largest companies began as immigrant-founded startups. So did many of the companies whose products people have relied on during the pandemic, including Zoom and Instacart.
Immigrants are also 80% more likely to start a business than those born in the U.S. Those businesses create 42% more jobs in this country than those started by native-born owners, but America isn’t the beacon of hope for immigrants it once was.
Current immigration policies are a barrier
Antiquated immigration policies continue to present obstacles to foreign-born founders. The fundamental issue is that the U.S. doesn’t provide a specific visa category for startup owners. Hundreds of thousands of immigrants compete for a limited number of visas, like the H-1B.
We are also starting to see the long-term effects and the lack of meaningful reform. Over the past decade, immigrants have turned to countries where startup visas are more easily accessible, like Singapore and the U.K.
In May 2021, President Biden reinstituted the International Entrepreneur Parole Program (IEPP), which allows admittance for foreign-born entrepreneurs who can prove they will offer significant benefits to the public.
While the restoration of this program is a good first step, there’s still a long way to go in improving the visa process for international students who will eventually become business owners.
Attending U.S. colleges and universities is a common path entrepreneurs take to begin their journey. But many international students who attend schools in the U.S. are not able to stay after graduating due to current U.S. policies. Significant policy reform is crucial in keeping the talent of these individuals in the country after graduating. Additionally, the pandemic, global competition and lengthy visa processing times are placing the country at a disadvantage in retaining skilled international students and workers.
The need for easier access to visas intensifies
Foreign-born entrepreneurs are critical in today’s economy. For this to become a reality, the U.S. needs to develop easier pathways to residency, provide more startup visas and create responsive, employment-based immigration policies. These are the conditions that will set the stage for continuous innovation and growth in the economy.