Immigrants significantly contribute to US entrepreneurial sector

by / ⠀Entrepreneurship Featured News Startups / May 7, 2024
"Entrepreneurial Immigrants"

Recent research shows that immigrants in the United States are 80% more likely to start a business than native citizens, with over half of America’s billion-dollar startups originating from immigrants. This highlights the important entrepreneurial contributions immigrants bring to the American economy, from job creation to innovation and global competitiveness. Despite initial challenges and cultural barriers, immigrants prove to be resilient, creative, and dedicated entrepreneurs.

The success and location of these startups are critical in understanding the entrepreneurial landscape. Where the business is sited can greatly impact its performance, as accessible resources, socioeconomic factors, and political climate play a role. This underscores the need for inclusive and supportive environments for immigrant entrepreneurs.

Part of the research focuses on Canada’s Start-up Visa Program, launched in 2013, which grants permanent residency to qualifying immigrants. As part of the program, immigrants are required to secure support from designated Canadian investment groups, promoting entrepreneurship and contributing to Canada’s economy.

Immigrant impact on American entrepreneurship

The program has successfully attracted globally talented individuals, reinforcing Canada’s dynamic and globally competitive economy.

Scholars suggest that this Canadian initiative seems to influence the relocation decisions of U.S immigrant entrepreneurs. Analysis of approximately 1.2 million non-Canadian entrepreneurs living in the U.S before starting a business in either the U.S. or Canada, supports this theory. This subset of entrepreneurs, while not all deciding to migrate, has shown substantial growth in businesses that have bolstered Canada’s local economy through job creation and wealth distribution thanks to this initiative.

Despite representing only 14% of the U.S. general population, immigrants make up 26.1% of the entrepreneurial landscape. Introduction of Canada’s Start-Up Visa program showed an increase in American immigrants starting Canadian businesses. These data highlight the disproportionate contribution immigrants add to the entrepreneurial sector, emphasizing their role in business innovation and growth.

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However, immigrant-founded Canadian startups initially based in the U.S. have a slightly lower survival rate compared to native counterparts. Around 73% of immigrant-founded businesses remained standing after three years, in contrast to an 85% survival rate in businesses built by Canadian-born entrepreneurs. Factors such as relocation costs, foreign operating challenges, and different entrepreneurial environments between U.S. and Canada account for this disparity in business resilience.

About The Author

April Isaacs

April Isaacs is a freelance writer and editor with over 10 years of experience. From the art scene in Paris to pastures in Montana, April has covered individuals' stories and can confirm that no two stories are the same.

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