The rule of thumb used to be that immigrants founded about 52% of Silicon Valley startups. This is likely no longer the case, the result of tightened visa and naturalization policy since the 9/11 attacks.
The consequence is that “America is experiencing the first brain drain in its history” as potential entrepreneurs return to their home countries to start companies, the academic Vivek Wadhwa said Wednesday. Wadhwa is associated with Singularity University, Stanford and Duke, and joined venture capitalists Michael Moritz of Sequoia Capital and Shervin Pishevar of Menlo Ventures to share thoughts on the changing immigration landscape.
The occasion was the U.S. Citizenship and Immigration Services “Entrepreneurs in Residence” summit, an effort kicked off in Silicon Valley to gather information from business leaders and other experts to inform policy decisions.
“American no longer has a monopoly on knowledge,” Wadhwa asserted, setting the tone for the morning session.
The issue of immigration is a crucial one for venture capital. Investors have suffered over the past decade from a shortage of top engineers and startup talent, unable to recruit adequately from abroad.
It is the number one business problem in Silicon Valley today, emphasized Moritz, a Sequoia partner. “The unintended consequences of clamping down at the borders means that the life blood of Silicon Valley is inadvertently getting choked off,” he said, adding that if the immigrants are taken out of Silicon Valley, “you have no Silicon Valley.”
In Singapore, officials recruit the best and brightest high school students from schools in India and China to assure a future talent pool, Moritz said. “So what would I dream of?” he expounded. “I’d dream of a little office that we could have at Sequoia Capital that allowed us to automatically stamp and give green cards to the talented people who would generate prosperity for America tomorrow.”
Pishevar, who like Moritz is an immigrant to the United States, went a step further. This Menlo managing director advocated an active rather than passive recruitment policy, where the country would search the world for talented people and invite them to become Americans.
Silicon Valley is as perfect a meritocracy as one can find, he said. Not entirely perfect: it needs more women and more minorities, including African Americans. But “if you’re talented and you come here with a dream, those dreams are possible,” he said.