Immigrant Founders and Key Personnel in America's 50 Top Venture-Funded Companies - NFAP Policy Brief

Abstract

Immigrants are increasingly important in driving growth and innovation in America, as evidenced by the role played by foreign-born founders and key personnel in the nation’s breakthrough companies. Immigrants have started nearly half of America’s 50 top venture-funded companies and are key members of management or product development teams in more than 75 percent of our country’s leading cutting-edge companies. The research finds that among the top venture-backed companies, immigrant founders have created an average of approximately 150 jobs per company in the United States.

The research involved conducting interviews and gathering information on the top 50 venture-funded companies in the United States, which were ranked in 2011 by the research firm VentureSource based on factors that included company growth, (successful) track record of CEOs, founders and investors, and capital raised. The companies, all privately-held and with the potential to become publicly traded on the stock market in the years ahead, are today each valued at less than $1 billion and have received venture capital (equity) financing within the past three years, an important indicator of the promise seen by investors.

The research finds that 48 percent, or 24 out of 50, of the country’s top venture-funded companies had at least one immigrant founder. This illustrates the increasing importance and contributions of immigrants to the U.S. economy. A 2006 study conducted with the National Venture Capital Association identified an immigrant founder in 1 in 4, or 25 percent, of publicly traded venture-backed companies created between 1990 and 2005.

This study is the first to examine the role immigrants play on the management or product development team in leading private companies in information technology, health, energy, business and financial services, and other fields. The research found 38 of the top 50 companies, or 76 percent, had at least one immigrant helping the company grow and innovate by filling a key management or product development position. Chief technology officer, CEO and vice president of engineering are the most common positions held by immigrants in the top 50 venture-backed companies.

Keywords: immigrant, policy, founders, venture capital, vc, companies, startup