Indian-born founders lead the charge in US unicorns, reveals study

Even as concerns rise globally over the tightening of immigration rules under US President-elect Donald Trump, a recent study reveals that nearly half of the founders of US startup unicorns were born outside the country, with India leading the way. Indian-born founders account for nearly a fifth of all non-US-born unicorn founders, far exceeding any other nation.

 

The findings come from a study released by Stanford Graduate School of Business’ Venture Capital Initiative, which analysed data from 500 unicorns between 1997 and 2019. The dataset includes 1,078 founders, 44 per cent of whom were identified as non-US-born based on their birth details. These non-US-born founders hail from 65 countries worldwide.

 

India heads the list of non-US-born unicorn founders, with 90 from the country, followed by Israel with 52, Canada with 42, the UK with 31, and China with 27 founders.

 

In Europe, the UK tops the list, followed by Germany, France, Russia, and Ukraine. In Asia, India leads, followed by Israel, China, and Taiwan. In Africa, South Africa had five non-US-born founders. In the Americas (excluding the US), Canada led, followed by Brazil. In Australasia, no country reached double digits, with Australia and New Zealand contributing eight and six founders, respectively. 

 

Countries with fewer than five unicorn founders include Switzerland (4), Japan (3), Sweden (2), Greece (2), and Türkiye (2), among others.

 

Ilya Strebulaev, a professor at Stanford who oversaw the research, said, “Immigrants are crucial for US innovation, with nearly half of US unicorn founders being born outside the US.” He raises important questions: What drives immigrants to become successful founders, and what policies could further boost their contributions?

 

Interestingly, while many unicorn founders were born outside the US, a sizeable number pursued higher education there — a point Strebulaev acknowledges. A study from two years ago estimated that a quarter of non-US-born startup founders completed their university education in the US.

 

Stanford’s research, supported by other studies, also concludes that relocating startups to the US increases their chances of achieving unicorn status. According to the findings, Indian startups are 6.5 times more likely to reach unicorn status if they relocate from India to the US.

 

Reports suggest that Trump’s team has already started working on a plan for the mass deportation of illegal immigrants, with projections indicating a number around 20 million. While this move may not impact educated Indians, concerns remain that Trump could impose restrictions on legal immigration, affecting the hundreds of thousands of students who go to the US for education and later find jobs there.