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Why immigrants make the best founders
I believe that immigrants make some of the best founders, and almost half of the founders that I’ve backed in my career are immigrants.
Disclaimer: I am an immigrant myself - twice over.
Let’s explore why immigrants make great founders.
Who has the most valuable network in the diagram above? Jenny has the highest number of connections (five). To me, Mary is the most exciting person. She has four connections and serves as a bridge between the yellow and blue networks.
Being a bridge between two networks opens up unique possibilities. Immigrant founders often open secondary offices in the country they come from (e.g. Egypt, India, Israel, Turkey), unlocking access to a new pool of talent and lower labor costs outside the U.S.
In addition, immigrant founders can capitalize on their relationships abroad and expand customer bases across borders more seamlessly. With the cross-cultural context and understanding, they are well-equipped to balance the resource-intensive initiatives and patience to expand to new regions with the successes and immediacy of the U.S. market.
Resilience is the capacity to recover from difficulties. Many types of life experiences can help build resilience, for example, migration. Leaving family and friends, selling your prized possessions, and moving across the world to a place where nobody knows or cares about you is a traumatic experience.
You learn to be resourceful and self-reliant in contexts characterized by many obstacles and struggles, including finding a job, learning a new language, coping with bias / discrimination, or the simple tragedy of spending Christmas alone.
In this study, migrants showed higher resilience capacity than non-migrants. Interestingly, although migrants experienced more traumatic events, the impact of trauma on mental health outcomes was greater in non-migrants. Immigrant founders are well-equipped to handle the ups and downs of building a startup (and likely to be less scarred by them).
Perspective and inspiration
While Zoom, with its $30B enterprise value today, is an obvious success story, it didn’t seem like that at first. People wouldn’t even take meetings with Eric Yuan (CEO of Zoom). Santi Subotovsky who led Zoom’s Series C and is an immigrant from Argentina said in a podcast interview,
“I had a real need. I wanted to stay in touch with my friends and family in Argentina, and I couldn’t find any technology that allowed me to have a conversation”.
Immigrants can recognize opportunities, which might not be salient to others. They have unique needs and are keen observers of their environment.
They can also import ideas from their native environment to their host environment (e.g. livestream shopping from China to the U.S.), and vice versa (e.g. Uber in the U.S. ⇒ Grab in SE Asia)
Back in 2018, Daniel Schreiber (CEO of Lemonade) spoke with a group of us taking a course at Tel Aviv University.
Before founding Lemonade, Daniel looked at a bunch of industries where customer experience was terrible and chose insurance. Insurance is “such a vast industry, unloved by consumers, but used by all of them”. With no previous experience in insurance, he started with a blank slate and designed a technology-forward and customer-first insurance company, the way it should be.
From time to time again, immigrants take on challenges that others shy away from because “it is too difficult” or “it would take too long”. Sometimes you need the audacity of an outsider to do something huge.
When I first moved to the U.S., I noticed a popular conversation starter - “Where did you go to college?”
Over time, I realized that in a country with over 300 million people, college affiliation is an easy way to dissect social networks. (e.g. “You went to MIT too? My sister-in-law was in the Class of 2005!”) and build affinity with strangers.
Many immigrants don’t come with these natural affiliations or networks that might open up doors to your first customers or partnerships. The lack of familiarity with culture, language and social cues can compound to make building a startup an especially frustrating experience for newcomers.
I believe that talent is evenly distributed around the world and opportunities aren’t. The fact that the U.S. holds cultural leadership globally and many of the brightest minds around the world aspire to come here might be the single most important competitive advantage of this country’s tech ecosystem.
Talent comes in all sorts of shapes and colors. I hope to go beyond these shapes and colors and see founders and their ideas for what they are.
I am excited to continue partnering with immigrant founders.
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