Study Sheds Light on Immigrants' Impact in Technology

Sixteen percent of fast-growing technology firms have at least one immigrant founder, with most coming from India, according to an SBA study.

By Angus Loten and Meredith Maines | 
 

Immigrants are playing a key role in some of the nation's fastest-growing technology companies, according to a recent study by the SBA's Office of Advocacy.

Sixteen percent of the 1,415-company sample had at least one foreign-born entrepreneur as a member of the founding team. Of the 205 companies with at least some immigrant representation, 85 had one foreign-born founder, 30 could claim two, and five had three or more. The Office of Advocacy polled "high-impact" tech firms, which it defined as those firms that had at least doubled sales between 2002 and 2006 and posted significant employment growth.

Jules Lichtenstein, a senior economist at the Office of Advocacy, said the study left some questions unanswered, however. When compared to similar studies, the 16 percent is a lower figure than some previous results, but on par with others. Because such surveys are conducted by different organizations -- such as the Kauffman Foundation and Thomson Financial -- and poll a slightly different definition of "high-tech," Lichtenstein said trying to analyze results simultaneously is somewhat of an apples-to-oranges comparison.

"You can't say there was a decrease in immigrant entrepreneurship based on these very different studies," Lichtenstein said. "We're going through a recession, as well, so the economic cycle has an impact on companies being founded in general."

While the varied findings should not be used to predict a trend, Lichtenstein said, the Office of Advocacy study does reveal where immigrant entrepreneurs hail from. Most came from India, followed by the United Kingdom, followed closely by Canada and Japan, which were tied, followed by China.