WHY ARE IMMIGRANTS TO THE UNITED STATES SO ENTREPRENEURIAL?

Immigrant Entrepreneurship: Understanding the Intersectional Factors Behind Success

Immigration and immigrant entrepreneurship have prompted significant interest across academic, policy, and public spheres for compelling reasons. In the past two decades, immigrants have launched countless small businesses while founding more than half of all “unicorn” startups valued over $1 billion—with the majority of these billion-dollar ventures listing only immigrants as founders. Research consistently demonstrates that immigrants are not just more likely to become entrepreneurs but also more likely to innovate. Given this remarkable representation among entrepreneurs, identifying the key factors that drive immigrants to start new ventures has become critically important for effective policymaking.

Using comprehensive data compiled from multiple sources and employing sophisticated econometric methods, a groundbreaking study published in the prestigious Journal of Business Venturing provides robust evidence to answer this question. The research reveals that while all immigrants tend to be predisposed toward entrepreneurship through their immigration experience, educated immigrants from countries that place higher cultural value on entrepreneurialism are uniquely and especially likely to create successful new ventures.

This important study specifically examined the intersectional effects of immigrants’ higher education (functioning as both resource and identity) combined with their entrepreneurial mindmaps (shaped by their home country’s entrepreneurial culture) within the context of the host country’s state-level institutional environment (representing prevailing power structures), on the probability of becoming an entrepreneur in the United States.

Unlike previous research that typically applies intersectionality theory to predict the compounding challenges of multiple “oppressed” identities, this study offers fresh insights into how intersectional effects can actually confer unique advantages to certain immigrant groups in the U.S. Furthermore, rather than overemphasizing inherent traits such as race and gender, the researchers suggest we must give greater consideration to dynamic contextual factors that shape individual lived experiences. They recognize that our globalizing era enables people to develop and express new identities no longer necessarily tied to traditionally defined ethno-linguistic, national, or cultural backgrounds. Individuals, including immigrants, are not limited to their innate identities but can strategically adapt those identities to achieve desired outcomes.

This perspective deliberately doesn’t diminish the significance of oppressive power structures. The research clearly shows that certain intersectional effects do constrain entrepreneurship among specific groups. However, by clarifying the concurrent influence of contextual factors, it demonstrates how the theorized effects persist even across identity subcategories. This highlights crucial factors that enable people to overcome institutional challenges—information that policymakers can leverage to identify and address both enablers and barriers to new venture creation.

In relation to immigrant entrepreneurship literature, this study demonstrates the enduring influence of cultural mindsets that immigrant entrepreneurs bring from their home countries to their destinations. Thus, immigrants’ risk-taking capacity and other entrepreneurial activities depend not only on their formal education but also on the informal mindmaps they have developed through exposure to different cultures, customs, and traditions. By providing evidence of an embedded, intersectional identity of an “educated immigrant go-getter,” this research helps explain the widespread success of immigrant entrepreneurship in the United States while simultaneously demonstrating the importance of formal institutional factors in determining entrepreneurship levels.

Policymakers worldwide can utilize these valuable insights to design targeted interventions that more effectively attract, retain, train, mentor, and support immigrant entrepreneurs—ultimately fostering greater innovation and economic growth.