Reduxio’s POV on the recent Executive Order on Immigration and its implications for innovation
At this point, it would be rather surprising if you are not familiar with both the Trump administration’s Executive Order 13769 on Immigration which was issued Friday 27 January, as well as the swift and powerful response from the American public, most notably in the world’s most preeminent technology and startup cluster in the San Francisco Bay Area - Silicon Valley region. This EO struck at the very heart of innovation culture, and led to sustained protests as well as strong voices of opposition from Apple, Facebook, Microsoft, and many other iconic company CEOs.
This EO, officially titled “Protecting the Nation from Foreign Terrorist Entry into the US”, and more popularly known as the “Immigration Travel Ban” has been widely criticized. More recently, it was struck down by the US 9th Circuit Court of Appeals.
As a 25 year serial technology entrepreneur across what is now 8 VC –backed startups, and as a Professor of Entrepreneurship and Innovation for many of these 25 years, both at MIT Sloan and now at the Hult International Business School, I have learned a thing or two about innovation.
First, venture capitalists focus primarily on the team as the key criteria when deciding whether to fund a startup. In real estate, it's all about location, and in tech it's all about the team. Quite simply, this means placing the absolute best people that you can recruit into key executive and individual roles. Given the insanely long odds against success for any given startup, this is the single most important variable that a new venture’s executive team has control over. Over the course of my career, my colleagues and I have been absolutely “color blind” when it comes to hiring. We simply want the best in the world at their respective positions.
At Reduxio, our CEO is Canadian, our President and I are American, our VP Products is from India, our VP Engineering, CTO and VP R&D are all from Israel. Key members of our team hail from Argentina, Belgium, Denmark, Estonia, Mexico, Netherlands, the Philippines, Russia, the Ukraine, and Venezuela. We work closely with a very talented India-based development team and Latin American – based web design team.
Only two things matter:
- They are great at what they do
- They fit with our culture and our values
How’s it working for us. Exceptionally well. In our first year in the market, we blew out our targets.
I have seen this play out again and again, as an operating executive, as a board member and as an advisor to startup teams around the world. Strong, diverse teams have an inherent advantage over those who limit their hiring to a narrowly defined group. It is critical to innovators to have complete freedom to hire, regardless of country of origin (as long as they meet the legal requirements to be in the US).
We have to recognize that this country is a country of immigrants. Other than the indigenous Native Americans, we are all immigrants or descendants, event those of us whose ancestors came over on the Mayflower.
It’s important to understand how many of our most successful startups have been founded by immigrant. It turns out approximately 50% of startups that achieve “unicorn status” – valuations of $1B USD - have at least 1 significant co-founder who is an immigrant. These include: Apple, Facebook, Google, Success Factors, Tesla, WhatsApp, and Yahoo, amongst countless others. If we begin to limit the ability of immigrants to work in the US, they will simply take their talents elsewhere. Given the intensely competitive global economy we must compete in, this will not bode well for our long term innovation prospects.
Recently, I have been asked to share my views on this vital issue with a number of top tier national and global new media:
From an interview with Aljazeera: Worldwide News Network
“There's such a level of anxiety amongst those who want to stay in the states, who want to work in the valley or other tech clusters”
From an interview with CBS: International News Channel
“Even if (immigrants) are here legally, there’s a level of paranoia.”
From an interview with Fast Company
“In fact, half of all startups that have scaled to $1billion valuations, those that create the most jobs and wealth, were started by immigrants.”
From an interview with Inc Magazine
"If we want to continue to be the great entrepreneurial and innovation beacon of the world, we will kill the golden goose faster than we can imagine if we shut our borders."
Being on the right side of this issue is vital to the long term vibrancy of the US economy, and to our fabled Silicon Valley tech ecosystem, which is the envy of the world.