Immigrant Entrepreneurs & Educational Attainment : A Deeper Look

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A recent report by  Kauffman Foundation infers that there is a strong correlation between educational attainment and entrepreneurship.

A report released by the Ewing Marion Kauffman Foundation that tracked the educational backgrounds of immigrant entrepreneurs who were key founders of technology and engineering companies from 1995 to 2005 shows a strong correlation between educational attainment (particularly in science, technology, engineering and math) and entrepreneurship.

Click image, above, to read Education, Entrepreneurship and Immigration: America's New Immigrant Entrepreneurs, Part II.

Click image, above, to read America's New Immigrant Entrepreneurs (part 1 of the study).

But before jumping to 'any' conclusions about  role of Educational Attainment to Entrepreneurship, (which I believe is construed and a misquoted wisdom), consider the following points from the report itself:

  • The report  studied only Technology and Engineering companies.  It would have given a much better picture of Entrepreneurship if it had included all kinds of Entrepreneurship activity by these immigrants.  If the report had shown that educational attainment is a key factor in every Entrepreneurial activity, I would have bought it flat.
  • Most of these Tech-Entrepreneurs (as per report about 93%) came to US for work or study. As everybody already know, this is the primary reason for Indians to come to US.  US Immigration is not that easy to tackle, if not impossible,  for a highschool dropout to come to US and start a business. If we see Indian immigrant population per se, these numbers will stay the same.  Almost all came for either study or work. So I would rule out their educational background in high tech as a factor for their entrepreneurial ventures in US. If they had come to US for 'any other damn reason' , they would have started their own companies.
  • If education attainment is such a key factor for Entrepreneurship, why don't we find similar Entrepreneurship activity in India where the rest (a majority) of the High Tech Indians still work or study.
  • It is the same case with most other Immigrants (from china etc). They all came to US for either work in high tech or study in US. Whatever they do, you will find a strong correlation to their High educational attainment. For example, barring a small portion of these Entrepreneurs, rest of these high tech Immigrants work throughout their lives as employees of some firm. That is a strong correlation between High Educational attainment and mind blowing lifestyle.
  • The % of these Indian Immigrant Entrepreneurs that came from IITs is only a 15% as per the report. That number itself tells a lot more than I can argue. IITs only take the brightest of students. But they represent only 15% of the Entrepreneurial activity, despite all the hype, investment and high action networks. It clearly rules out you don't have to be at IIT to become an entrepreneur.  IIT background helped these guys to come to US and work or to study and provide an easy access to lots of resources for sure. Whether their 'belong to IIT' has anything to do with their entrepreneurial spark is still debatable. 

I believe, your engineering excellence has nothing to do with Entrepreneurship. It is altogether a different mindset. A different perspective of looking at an opportunity and the market. If you say, if you can cook a better burger you can become an Entrepreneur at making burgers and probably beat McDonalds, I would try to believe then that your engineering excellence would make you a better Entrepreneur. And, I will learn my lesson.

Isn't there a strong correlation between starting your company in a 'Garage' and its success? 

Isn't there a strong correlation between 'living on the streets' and becoming 'a rock star'?

Isn't there a strong correlation between 'dropping out of high school' to 'building an empire'?

And one more final question,

To become a successful entrepreneur and start a Technology or Engineering company, do you want to study an MBA? or MS in Computer Sceience? or .... drop out of high school? or ... ??

Correlations are good for reports, books, seminars, yeah, ofcourse blogs and I believe good for nothing. Many Americans tend to assume that every other Indian is a software engineer or a maths graduate or a high tech graduate. And yet 99% of Indian entrepreneurs that actually built India and making a difference  to India as you read have unfortunately never studied any of them. Those who studied are mostly working in IT and many of them in US or working for US based IT companies.

Comments

Bootstrap said…
I strongly agree. Entrepreneurship has nothing to do with the educational attainment that an individual has. Entrepreneurs think "outside-the-box", and most of the skills and knowledge that they gained and contributed to their success comes mostly from experience and not schools.
July 11, 2007 at 5:27 PM
Peter said…
Great article. I stumbled across it while looking for entrepreneurial training. Here's one you might be interested in:

http://smartstartup.typepad.com/my_weblog/2007/07/how-to-go-from-.html
July 17, 2007 at 7:19 PM
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