International graduate students create more startups and boost entrepreneurship among their native peers
The following contribution corresponds to the Global Migration Center’s website, which is defined as follows: The Global Migration Center is a key resource for addressing these issues through a multidisciplinary approach that seeks to better understand vulnerable migrants and develop research-based actions for policymakers.
Our objectives are:
To produce and disseminate rigorous, relevant, interdisciplinary, and multidisciplinary research on the causes and consequences of international migration, immigrant integration, and migration law and policy, with a particular focus on vulnerable migrants.
To consolidate and expand the network of immigration scholars at UC Davis, including faculty, graduate students, undergraduate students, and members of campus organizations, becoming a global center on these issues.
The authors are
Giovanni Peri
Professor of Economics, UC Davis
Director, UC Davis Center on Global Migration
Michel Beine
Professor of Economics, University of Luxembourg
Morgan Raux
Adjunct Professor, Aix-Marseille School of Economics
The United States consistently ranks among the countries with the highest entrepreneurial intensity and business dynamism, key factors in its economic leadership.
Innovative startups are a key driver of this dynamism.
In a new analysis, we find that international students in graduate programs in the U.S. significantly increase the number of startups, especially local ones, while also boosting the entrepreneurship of their American peers.
Universities play a key role in developing talented international students, but their limited ability to remain in the U.S. after graduation means they miss out on locally generated talent and potential.
Summary of Recommendations:
Reducing the barriers that prevent major universities from enrolling international students in their master’s programs will generate significant momentum for the creation of innovative local startups, contributing to local employment and economic growth.
Increasing flexibility and support for international master’s students after graduation, such as access to local incubators and legal assistance, will encourage them to remain in the US and contribute to local entrepreneurship, which also generates broad economic benefits.
Expanding visa or residency opportunities, as proposed by the STEM Talent Retention Act, will encourage international students to remain in the US, increasing their economic contribution and further fostering local entrepreneurship.
Entrepreneurs drive the creation of startups, the most innovative segment of new businesses, which are key contributors to employment, real output, and productivity growth in the United States. They introduce substantial, high-potential innovations to the market, hire highly skilled workers, and often pay higher wages than other companies.
More than half of innovative American entrepreneurs (54% according to Forbes)
hold a U.S. graduate degree.
This means that top American universities, such as the University of California, are important generators of innovation, as their graduates translate their talents into creativity, inventions, and new businesses. These businesses, in turn, generate added value, productivity growth, and jobs for the U.S. economy.
American universities attract highly talented individuals from around the world, especially for their graduate programs, channeling them into leadership, management, and entrepreneurial positions.
Over the past decade, approximately 300,000 foreign-born graduate students have obtained a U.S. visa each year to enroll in a U.S. graduate program.
Many of them remained in the U.S. for at least a few years after earning their degrees.
In a new study, we quantify how international students who earned a master’s degree in the U.S. contributed to the creation of new startups in the U.S. between 1999 and 2019.
Our analysis includes a broad representative sample of startups provided by Crunchbase, with information on their founders and highest degree, and data from the International Postsecondary Education Data Set (IPEDS), which includes the number of international students graduating from U.S. graduate programs.
The results show that international students contribute significantly to the innovative startup landscape in the U.S., strengthening the country’s economic leadership.
Generating Entrepreneurship and Innovation
Our analysis establishes a causal, rather than correlational, link between the number of international graduate students and new startups by leveraging changes in tuition rates for out-of-state students in U.S. graduate programs.
The reduction in tuition rates increased international student enrollment, and our statistical analysis isolated this enrollment increase to the creation of new startups, excluding any other potential contributing factors, including the local economy.
The results show that 150 additional international students in a cohort resulted in one additional startup being registered in Crunchbase within five years of that cohort’s graduation.
This is approximately 8 to 9 times higher than adding 150 U.S.-born graduate students to the same cohort.
Since Crunchbase only records the most successful startups that survive at least three years, this effect has a greater impact on the economy than simply adding startups that might not succeed.
This result is due to the fact that international students drive entrepreneurship among their American peers.
At least 40% of new startups generated by a higher proportion of international students are founded or co-founded by American graduates.
By interacting with international students, they are likely to gain broader perspectives on business and acquire new skills that complement their existing ones.
They may also make more domestic and international connections.
New startups founded or co-founded as a result of the increase in international students are highly valuable and innovative.
They are likely to raise $25 million or more in capital in the first five years and register at least one patent.
University Quality Drives Local Innovation
The high quality of master’s programs at American universities was a determining factor both in attracting talented international students and in the innovative startups they create after graduation. The greatest entrepreneurial potential among master’s degree graduates overall came from those from R1-R2 research universities, especially in STEM fields.
International master’s students at R1 research institutions, such as the University of California campuses, create startups at an even higher rate.
This is likely because these universities attract the most talented students worldwide.
While business master’s graduates represent the largest proportion of total startup entrepreneurs, graduates of programs in computer science, physical sciences, life sciences, and biomedical sciences also contribute significantly.
Most of these new startups are located near the university where the students earned their master’s degrees.
This means that high-quality universities generate high added value for their communities by attracting international talent and retaining their local business-building capacity.
Policy Changes to Retain Talent in the U.S.
These important contributions for international graduate students are being made despite their limited options for remaining in the U.S. after graduation.
The Optional Practical Training (OPT) visa extends the stay of some STEM graduates by two years. Employer-sponsored H1B visas and permanent resident cards (Green Cards) are limited.
A previous study found that, due to these restrictions, only 20% of international graduates of U.S. master’s degrees remain in the country for at least two years.
Some return home, while others go to countries like Canada or Australia, which have more open immigration policies for highly skilled workers.
For the United States, this means losing the talent and potential that high-quality American universities have helped create.
Instead, the U.S. government and universities can take several steps to retain these talented graduates and increase their positive impact locally.
These measures include reducing barriers to international student enrollment in graduate programs.
They also include supporting new startups and providing legal means for graduates to remain in the United States while building the innovative companies that contribute to maintaining U.S. leadership in business innovation.
Universities should support more student entrepreneurs. Find out why and how.
The following contribution is from the World Economic Forum website and is authored by Mark Dodgson, Professor of Innovation Studies at UQ Business School and Visiting Professor at Imperial College London. His research interests focus on corporate strategies and government policies for technology and innovation; David Gann, Vice-Chancellor for Development and External Affairs, University of Oxford.
Our Impact
What is the World Economic Forum doing to boost entrepreneurial action?
There is growing concern about the slowdown in entrepreneurial activity in the world’s universities.
However, entrepreneurship needs to be encouraged and facilitated, and students are increasingly demanding it.
Find out why this is so important and how universities can revive this vital area.
Fast-growing entrepreneurial initiatives are essential for prosperity and social progress.
Entrepreneurs create value by seizing opportunities, taking risks, solving problems, and taking action.
They take risks by creating and commercializing innovative technologies in ways that large companies cannot.
Sometimes, these technologies open entirely new markets, transforming industries. Tesla is a good example.
Small businesses can be pioneers and agile in adapting to new trends and responding to crises, such as the COVID-19 pandemic.
They can adapt quickly to take advantage of opportunities or when their growth slows.
Their early years of rapid growth can generate excellent returns for venture capital and capital markets.
Zoom is a good example.
However, there is growing concern about a possible drastic slowdown in the development of ideas that fuel the early stages of new company formation.
Changes in the university sector brought about by the pandemic and the geopolitical tensions that are transforming the global economy underlie these concerns.
Universities play a crucial role in driving innovation and entrepreneurial activities.
They provide the conditions, facilities, and talent that foster the emergence of innovative ideas.
Many have systems in place to support the development of new ideas and their practical application.
They play an important role in maintaining the business flow that provides opportunities for venture capital investment, which in turn drives the growth of entrepreneurial initiatives.
Universities must prepare their graduates for the careers they define themselves
In the past, university education typically prepared students for the careers others defined.
Now more than ever, in the unpredictable post-pandemic world, universities must prepare them for the careers they define themselves.
Universities must offer the curricula, facilities, and incentives necessary to create new generations of entrepreneurs, in addition to traditional pathways into professions, established businesses, and public administration.
This is part of the radical shift needed to modernize universities and will play a crucial role as they contribute to the creation of jobs and industries needed for economic recovery after COVID-19.
While once a marginal activity, entrepreneurship has become a fundamental part of the university experience.
Why encourage entrepreneurship?
Student demand for entrepreneurship courses has accelerated in recent years, reflecting their disillusionment with a world created by others.
Millennials want to shape their own future, and entrepreneurial skills are key to their working lives. Our experience teaching this subject for several decades has shown a substantial increase in demand for courses on social entrepreneurship.
There are also strong pedagogical reasons for teaching entrepreneurship, as it engages students with pressing real-world problems, develops critical thinking, and expands their life skills.
Universities contribute to fulfilling their economic and social mission by promoting entrepreneurship.
Entrepreneurship Programs
Universities offer in-person and experiential entrepreneurship programs for undergraduate and graduate students, along with extracurricular activities such as entrepreneurship clubs, competitions, and awards.
Entrepreneurship courses are proliferating.
It is estimated that there are at least 150 programs available to Stanford University students, delivered by a variety of providers.
A study has shown that Australia’s 41 universities offer nearly 600 entrepreneurship-related courses. The University of Queensland offers more than 100 courses on entrepreneurial learning across all its faculties.
The core curriculum includes courses on entrepreneurship theory, new business creation, venture financing, intellectual property, and negotiation skills.
More recent additions include design thinking, creativity management, and Lean Startup: teaching skills to shorten business development cycles.
The OECD and the EU have conducted national analyses of the impact of higher education institutions in supporting entrepreneurship.
Recommendations include fostering an entrepreneurial mindset, problem-based learning, enhancing interdisciplinarity, and connecting students with the local, regional, and international economy.
Organizations such as the UK Quality Assurance Agency offer guidance to higher education providers on business and entrepreneurship education.
There are no unified standards for entrepreneurship courses detailing why, how, and to whom they are taught.
We believe that standardizing curricula carries risks, as it is important to adapt entrepreneurship education to local and regional contexts: a course developed for Silicon Valley startups may have limited value in an agricultural region.
Which universities produced the most entrepreneurs this year?
Entrepreneurship programs are offered to different levels of participants, including academic staff who want to become entrepreneurs or mentor entrepreneurs.
Programs cater to students with different backgrounds and ambitions, for example, those working in digital or medical technologies, or those focused on design.
Some programs are offered exclusively to female entrepreneurs, such as Imperial College’s WEInnovate.
For entrepreneurship programs to be successful at all educational levels, universities must ensure that their intellectual property policies do not limit the ability of academic staff to collaborate with student entrepreneurs in commercializing their research.
Courses are offered to doctoral students and postdoctoral fellows. MedTech Superconnector, for example, is a joint initiative of six London universities created to facilitate the early development of innovative medical technologies, including devices and diagnostics.
It provides funding, training, mentoring, and access to industry partners to accelerate the application of medical research.
Techcelerate, a three-month program at Imperial College for postdoctoral researchers,
offers masterclasses and project analysis sessions, with the opportunity to present to a community of investors.
Participants must network and interview dozens of potential customers, competitors, or users of their research to refine their ideas and generate impact by identifying customer problems and market opportunities.
Entrepreneurial Skills
Learning about entrepreneurship fosters analytical, organizational, and interpersonal skills, and develops leadership and networking skills. Students learn to identify and solve problems, work in teams, assess risks, and communicate effectively with others in a wide range of fields, including investors.
It helps them innovate, invent, and implement solutions to problems.
It takes them beyond current approaches to specific disciplinary perspectives, helping them create imaginative new options, adopt strategic approaches, and design organizational mechanisms to experiment and turn good ideas into reality.
It develops the mental agility to move from identifying problems to finding solutions.
Fostering an entrepreneurial mindset prepares students for the uncertain and unpredictable world they will contribute to in the Great Reset.
Many students, especially in science and engineering, often seek quick fixes, sometimes finding answers before fully understanding the questions.
Entrepreneurial skills foster their ability to experiment and experiment with various possible solutions; to perceive alternatives and learn quickly from feedback; and to make evidence-based judgments to select options for further development.
Importantly, it helps maintain optimism in the face of failure.
Facilities and Incentives
Universities offer a wide variety of facilities and equipment to foster student entrepreneurship, including accelerators, hackspaces, makerspaces, invention rooms, incubators, wet labs, and digital observatories.
Imperial College has a wide variety of support mechanisms to encourage the development and testing of new products and services.
Its Entrepreneurship Lab coordinates various student programs, projects, and competitions.
The College’s Advanced Hackspace opened three years ago. At that time, the Imperial community, made up of 24,000 staff and students, produced around 1,000 prototypes per year.
The maker facilities, 3D printing room, labs, training, and advanced hackspace discipline have tripled prototyping.
The number of student startups at Imperial College has steadily increased, from eight in 2013/2014 to 59 in 2018/2019.
The University of Queensland has an Ideas Hub that attracts more than 900 people annually to its programs; an iLab, which has delivered more than 3,200 mentoring sessions; and a Startup Academy that fosters the advancement of entrepreneurial projects. Approximately 200 startups have benefited from iLab’s acceleration and incubation programs.
In addition to the physical infrastructure, students are offered networking and mentoring opportunities. Entrepreneurs in Residence are appointed, prizes are awarded, and venture capital funding is offered, all to propel students on their entrepreneurial journeys.
Many of the methods for supporting student entrepreneurship are complementary. Student projects can be converted into prize competitions, which can facilitate access to facilities, ongoing training, and funding opportunities.
Fostering student entrepreneurs should be woven into the university’s social fabric: a key component of its mission to contribute to prosperity and social progress, especially in the wake of the trauma of 2020.
Student entrepreneurs help build and leverage the university’s international connections, and some could become significant philanthropic donors in the future.
Perhaps most importantly, they contribute significantly to the dynamism and innovation surrounding universities and clearly demonstrate their social and economic contribution.
Positive Impact Through Business Education
The following contribution is from the AACSB website, the Association to Advance Collegiate Schools of Business, the global standard-setting body for business education and strengthening the world’s business schools through accreditation, thought leadership, and transformative learning.
The authors are:
JK Aier
Crystal Fickers
Rebecca Howick
Ajay Vinzé
Benjamin Kessler
How one school seeks to reduce barriers to business education and provide economic empowerment to communities across Virginia.
The SOAR Initiative at George Mason University’s Costello College of Business will offer comprehensive business training to three groups of aspiring entrepreneurs: refugees and immigrants, people from low socioeconomic backgrounds, and residents of rural and emerging communities.
A SOAR program supported refugees and immigrants, primarily from Afghanistan and Pakistan, with a six-week business boot camp, 12 weeks of business mentoring, and 13 weeks of consulting.
The school hopes this inclusive training model will create a virtuous cycle in which its results attract support and funding that can be used to positively impact more aspiring entrepreneurs in Virginia.
Achieving Financial Self-Reliance
The increasing economic volatility of the past 15 years has culminated in economic crises stemming from the COVID-19 pandemic. As a result of these crises, more students are seeking to hone their business skills and achieve the financial self-reliance that entrepreneurship brings.
This demand has driven the rapid expansion of entrepreneurship education.
Between the 2017-18 and 2019-20 academic years, business schools increased their entrepreneurship offerings by nearly 24%.
The Costello College of Business (CCB) at George Mason University in Fairfax County, Virginia, is no exception. Our recent $50 million naming gift, from the estate of entrepreneur Donald G. Costello, will support our school’s commitment to economic improvement through entrepreneurship, particularly in the Mason region of Northern Virginia. This historic donation is designated for scholarships designed to prepare students to become entrepreneurs.
However, our approach to entrepreneurship also aligns with two relatively recent developments in business education: the «decoupling» of education into modular offerings and, more profoundly, the obligation of business schools to demonstrate social impact.
Our efforts to contribute to the local entrepreneurial community align not only with the broader mission of George Mason University but also with Standard 9 of the 2020 AACSB accreditation standards, which emphasizes the need to achieve social impact.
At Costello College of Business, our core belief is «It’s All Business.»
By this, we mean that regardless of their calling in life, everyone will need entrepreneurial skills to navigate ever-evolving markets and ensure long-term success.
Similarly, we also believe that everyone, regardless of their educational level, should have the opportunity to control their own entrepreneurial destiny—that is, to become an entrepreneur.
Motivated by this belief, we work to develop innovative solutions to empower future entrepreneurs.
In 2022, our Center for Innovation and Entrepreneurship (CIE) identified opportunities to reframe programs and initiatives based on institutional strategic priorities and stakeholders.
In particular, we seek to reduce barriers to formal business education, in line with the Mason Virginia Promise to make training more accessible and provide economic empowerment to strategically targeted communities.
In September 2023, CIE launched the SOAR Initiative, which addresses both goals. SOAR is based on an inclusive entrepreneurship education model.
The SOAR Initiative and the RISE Program
SOAR is a holistic program that offers entrepreneurship training, mentorship, resources, and other forms of support to startups and individuals in our community who currently lack adequate access to entrepreneurship training opportunities.
The acronym SOAR stands for an approach to startups that empowers underserved communities; opportunities for community development and engagement; access to mentorship and credentialing assistance; and a roadmap to business, professional, and personal success.
The program is designed for aspiring entrepreneurs who belong to one of three populations: refugees and immigrants; people of low socioeconomic status, especially those living in the urban areas of Franconia and Alexandria in Northern Virginia; and residents of rural and emerging communities, especially those living in the city of Danville in Southern Virginia.
We hope to create specific programs that address the unique needs and opportunities of each of these three communities.
We launched the first of these programs in September 2023. The Shrivastava Family Refugee and Immigrant Success in Entrepreneurship (RISE) program was made possible by a $1.5 million donation from alumnus Sumeet Shrivastava. The son of a successful immigrant entrepreneur, Shrivastava was a government IT executive and is now a dedicated community leader.
Many of the newly arrived immigrants participating in RISE were highly skilled entrepreneurs or held academic degrees in their home countries and now need assistance establishing and managing businesses in the Commonwealth of Virginia.
Through the other two SOAR cohorts, we plan to offer Franconia/Alexandria participants business training that complements the vocational training provided by partner organizations.
We will guide Danville participants toward the emerging entrepreneurial ecosystem surrounding a new Caesars casino resort, scheduled to open there in 2024.
We aim to provide guidance to participants, provide them with profitable business plans, and help them secure the necessary financing to establish sustainable businesses.
We are currently seeking funding for the remaining two programs, in collaboration with state and Fairfax County government officials, as well as other stakeholders.
Finally, all three programs will include six-week entrepreneurial boot camps, followed by 12 weeks of mentoring and 13 weeks of hands-on consulting with students from across the university enrolled in entrepreneurship courses. The consulting phase will provide Mason students from diverse backgrounds with an experiential learning opportunity that will not only allow them to develop their own professional portfolios but may also inspire them to consider starting their own businesses.
Through SOAR programs, we aim to provide guidance to participants, provide them with profitable business plans, and help them secure the necessary financing to establish sustainable ventures. Program graduates will be prepared to turn to Mason Enterprise, the university’s economic development organization, and the Mason Small Business Development Center as sources of post-program support.
Our Progress to Date
The first Shrivastava Family RISE boot camp concluded in late October.
We started with 47 participants, mostly of Afghan or Pakistani origin, 31 of whom graduated from the six-week course.
The decrease was due to a rapid launch and an attendance requirement. Participants who missed more than one of the six consecutive Saturday sessions were invited to try again as part of the next RISE cohort, scheduled for early 2024.
Having experienced discrimination in the past, these participants yearned for a path to an alternative future.
The boot camp was designed to show them that entrepreneurship was one of those paths that could have a profound impact not only on their own lives, but also on those of their families and community members.
The boot camp featured a diverse list of guest speakers. Among them were Brian Wendroff, CPA and founder of the accounting firm Wendroff & Associates; Mahesh Joshi, entrepreneur and associate professor of management at CCB; Rudy Dekrooj, Senior Vice President of Virginia-based MainStreet Bank; and Grace Mittl, a recent BBA graduate from the University of Richmond and co-founder of Absurd Snacks, a company dedicated to selling safe snacks for people with food allergies.
The speakers introduced participants to key business support services and served as a link to the university’s broader entrepreneurial ecosystem.
Overall, the first annual bootcamp was a resounding success.
Participants were even more engaged and enthusiastic than expected. Furthermore, at the closing ceremony, we were impressed by the variety of projects proposed by the cohort, ranging from cafes and childcare centers to IT consulting services.
One participant shared a particularly transformative moment: «I had a completely different business idea before joining this class. But thanks to your lessons, I completely changed it. I did the math like you taught us and discovered the original version didn’t work. Now I have more confidence in my new idea.»
CIE organizers will continue to develop RISE from a diversity perspective.
Working with our current partners, they hope to expand the program to welcome participants from Iran, Iraq, and Syria, among other countries.
CIE also intends to expand official partnerships to reach more people within refugee and immigrant communities.
The inaugural RISE cohort is predominantly male, so organizers will work to achieve greater gender balance in future cohorts.
Additionally, as the program continues to evolve, they will look for ways to remove barriers to participation in areas such as transportation, childcare, and access to personal laptops.
Prioritizing Partnerships
During our planning, we have partnered with organizations that work closely with people who lack adequate access to entrepreneurship training opportunities.
Through input from our partners, we have been able to understand how we could utilize the resources and expertise of CIE and CCB to design innovative trainings that meet the specific needs of community members.
For example, SOAR has been working with Lutheran Social Services of the National Capital Area (LSSNCA), a human services, immigration assistance, and refugee-hosting agency serving people in need in Maryland, Virginia, and the Washington, D.C., metropolitan area. LSSNCA has been instrumental in helping us identify and recruit potential RISE participants; the organization has also provided participants with basic needs, such as food, housing, and full-time employment, so they are prepared for success before beginning the program.
We have partnered with organizations that help us understand how to design innovative trainings
that meet the specific needs of community members.
We are currently pursuing a collaboration with the W.I.S.H. Center. of Fairfax County, which we hope will connect us with people of low socioeconomic status. W.I.S.H. (Workforce, Innovation, and Skills Center) helps underemployed workers update their professional skills so they can earn a living.
Additionally, SOAR borrows its programming structure and key aspects of its teaching materials from the Urban Poverty and Business Initiative (UPBI). Offered by the McKenna Center for Human Development and Global Business at the University of Notre Dame in Indiana, UPBI programming promotes entrepreneurship in communities affected by adversity.
CCB is one of only 30 global partners licensed to use UPBI’s proven framework, which CIE adapts to the unique needs of SOAR participants.
A Virtuous Cycle of Impact
Several key stakeholders at CCB also participate in our inclusive entrepreneurship education model.
Professors with experience in entrepreneurship participate as volunteer guest speakers in our intensive training sessions, and we are recruiting mentors from our strong network of entrepreneurial alumni.
To connect academic work with practice, we are connecting early-stage entrepreneurs with a diverse team of talented business students in what promises to be a mutually beneficial co-learning opportunity.
Additionally, with the help of Toyah Miller, CIE Director of Research, we are collecting and analyzing data to track the outcomes of our programs.
Miller will work with Michelle S. Dromgold-Sermen, Deputy Director of the Immigration Research Institute in the College of Humanities and Social Sciences at Mason University. Miller and Dromgold-Sermen, with the help of the CIE team of students and staff, will document participants’ successes and challenges two to three years after program completion. They will also track relevant metrics such as the number of businesses started and jobs created, generating applied research with real impact.
In short, we anticipate that these activities will form a virtuous cycle.
By demonstrating SOAR’s impact, we will position CCB to secure additional external funding, which we plan to use to make SOAR financially self-sufficient and scalable.
As we grow, we will achieve greater impact, which we hope will attract more help and support from faculty, alumni, and donors who want to create positive change in their communities.
In fact, the virtuous cycle is already underway: A community member recently responded to a CIE social media post by offering to arrange a meeting with a banker specializing in multicultural lending.
SOAR is positioned to generate tangible and lasting positive change, both within and outside the Costello College of Business, by aligning key stakeholders and partners around inclusive entrepreneurship education.
We hope our experience will encourage other schools to explore how to share with their communities what is perhaps the most powerful engine of economic progress available to business scholars: entrepreneurial tools. Through entrepreneurship education, business schools can help people revitalize their dreams, transform their lives, and boost their local economies.
How does graduate entrepreneurship contribute to innovation and technological advancement?
The following contribution corresponds to the Faster Capital portal, which defines itself as follows: FasterCapital is a global online startup and incubator based in Dubai. Our main programs are: Co-founder or Technical Partner, From Idea to Product, Growing Your Startup, Capital Raising, and Mega Funding Program. FasterCapital was founded in 2010, and our model has been publicly available since 2015. FasterCapital has graduated 20 startups that are fully operational. We have assisted 454 startups in the acceleration program.
Innovation, Technological Innovation, Technological Advancements
Graduate entrepreneurship plays a crucial role in fostering innovation and driving technological advancement.
Below are several ways in which graduate entrepreneurship contributes to innovation and technological advancements:
- Developing innovative ideas: Graduate entrepreneurs typically have an innovative perspective and a willingness to challenge the status quo. They are driven by a desire to solve problems and make a difference in the world. This mindset often leads to the development of groundbreaking ideas with the potential to revolutionize industries.
- Commercializing research and development: Many graduate entrepreneurs are researchers or have close ties to research institutions. They have firsthand knowledge of the latest scientific discoveries and technological advancements. By starting their own companies, they can effectively and efficiently commercialize research and development initiatives, bringing new technologies and innovations to market.
- Connecting academia with industry: Graduate entrepreneurs act as a bridge between academia and industry. They understand the needs and challenges of both worlds and can effectively translate academic research into practical applications. This helps ensure that scientific discoveries and technological advancements are not limited to research laboratories but are used to generate real impact.
- Boosting job creation and economic growth: Graduate entrepreneurship has a significant impact on job creation and economic growth.
By starting their own businesses, graduate entrepreneurs create employment opportunities for themselves and others.
They also contribute to the local economy by creating new products and services, attracting investment, and generating tax revenue.
- Fostering a culture of innovation: Graduate entrepreneurs inspire and encourage others to think creatively and develop innovative ideas. Their success stories serve as a source of inspiration for aspiring entrepreneurs, creating a culture of innovation in society. This, in turn, fosters an ecosystem that supports entrepreneurship and technological advancements, driving innovation and growth.
- Collaboration and knowledge sharing: Graduate entrepreneurs often collaborate with other entrepreneurs, research institutions, and industry professionals. These collaborations facilitate the exchange of knowledge, ideas, and resources, leading to the development of new and improved technologies. Through networking events, incubators, and accelerators, graduate entrepreneurs have access to a wealth of experience and support, further enhancing their ability to create innovative solutions.
- Disruption in traditional industries: Graduate entrepreneurs are often at the forefront of disruptive technologies and business models. They challenge established players and traditional ways of doing things, driving innovation and technological advancements. By introducing new ideas, products, and services, they generate competition and force existing industries to adapt and evolve.
- Addressing societal challenges: Graduate entrepreneurs are uniquely positioned to address the most pressing societal challenges through innovative solutions. From healthcare and education to sustainable energy and environmental conservation, graduate entrepreneurs tackle complex problems and develop technologies that can have a profound and positive impact on society.
In conclusion, graduate entrepreneurship contributes to innovation and technological advancement in numerous ways.
By fostering the development of innovative ideas, commercializing research, connecting academia with industry, driving job creation and economic growth, fostering a culture of innovation, promoting collaboration and knowledge sharing, transforming traditional industries, and addressing societal challenges, graduate entrepreneurs play a vital role in driving progress and shaping the future.
How does graduate entrepreneurship contribute to innovation and technological advancement? – FAQ: Graduate Entrepreneurship: What, How, Why, and When
How does postgraduate entrepreneurship contribute to innovation and technological advancement? – Frequently Asked Questions: Graduate Entrepreneurship: What, How, Why, When
Technological Innovation
Technological Advancements
Graduate entrepreneurship plays a crucial role in driving innovation and technological advancement in several ways:
- Knowledge and Skill Acquisition: Graduate entrepreneurship programs provide students with the knowledge and skills necessary to identify and develop innovative solutions to market needs. Through coursework and practical experiences, aspiring entrepreneurs gain a deep understanding of market trends, customer preferences, and emerging technologies. This knowledge provides graduates with the expertise needed to create innovative products, services, and business models.
- Research and Development: Many graduate entrepreneurship programs encourage students to conduct research projects that address real-world challenges. This emphasis on research promotes the development of cutting-edge technologies and the discovery of new scientific knowledge. By fostering entrepreneurship among graduate students, universities facilitate the translation of research results into viable commercial products, thus contributing to technological advancements in various fields.
- Technology Transfer: Graduate entrepreneurship programs often collaborate closely with university technology transfer offices. These offices help students and faculty identify patentable technologies and commercialize them. By facilitating the transfer of innovative technologies from academia to industry, graduate entrepreneurship programs accelerate the adoption and diffusion of new technologies, thereby driving overall technological advancements.
- Collaboration and Networking: Graduate entrepreneurship programs foster collaboration and networking opportunities among students, faculty, industry professionals, and investors. Through workshops, mentoring programs, and networking events, students gain valuable knowledge and forge relationships with industry experts. These connections often lead to collaborations, investments, and access to resources that can further drive innovation and technological advancements.
- Startup Ecosystems: Many graduate entrepreneurship programs are integrated into dynamic startup ecosystems, which serve as centers of innovation and technological advancement. These ecosystems typically consist of incubators, accelerators, coworking spaces, and funding agencies that provide support and resources to aspiring entrepreneurs. By immersing students in these environments, graduate entrepreneurship programs expose them to the latest technological advancements and business best practices, fostering a culture of innovation.
- Funding Opportunities: Graduate programs in entrepreneurship typically provide students with access to funding opportunities specifically designed for startups. This financial support enables graduates to transform their innovative ideas into viable businesses. By facilitating access to capital, graduate programs in entrepreneurship contribute to the growth and development of technology startups, which in turn drive innovation and technological advancements.
- Job Creation: Graduate programs in entrepreneurship not only enable individuals to create their own businesses but also provide them with the skills necessary to create job opportunities for others. As startups scale and grow, they create employment opportunities for individuals with specialized skills, contributing to economic growth and technological advancements.
In short, graduate entrepreneurship programs contribute to innovation and technological advancements by equipping students with knowledge and skills, promoting research and development, facilitating technology transfer, fostering collaboration and networking, boosting startup ecosystems, providing funding opportunities, and creating job opportunities. These programs play a critical role in driving economic growth, improving quality of life, and addressing global challenges through innovation and technology.
How can universities and educational institutions support graduate entrepreneurship initiatives?
Educational Institutions
Universities and educational institutions play a crucial role in supporting graduate entrepreneurship initiatives. Encouraging and fostering entrepreneurial initiatives among graduates can boost economic growth, job creation, and innovation.
Below are several ways universities can support graduate entrepreneurship initiatives:
- Establish Entrepreneurship Centers: Universities can create dedicated entrepreneurship centers that serve as hubs for aspiring entrepreneurs. These centers can offer a variety of services and resources, including mentoring programs, networking opportunities, financial support, and access to workshops and training sessions on business planning, marketing, finance, and intellectual property.
- Develop entrepreneurship courses and programs: Universities can incorporate entrepreneurship courses and programs into their curricula. These courses can cover various aspects of business creation and management, such as ideation, market research, business development, and financial management. By offering these programs, universities can provide students with the knowledge and skills necessary for entrepreneurship.
- Create incubators and accelerators: Universities can establish incubators and accelerators that provide physical space, infrastructure, and support services for startups. These programs can offer mentorship, access to funding, networking opportunities, and resources for business development. By providing an enabling environment, universities can help graduates turn their ideas into viable businesses.
- Facilitate industry partnerships: Universities can foster collaboration between graduate entrepreneurs and industry partners. These partnerships can provide startups with access to industry expertise, market knowledge, and potential customers. By connecting graduates with industry professionals, universities can improve the commercialization prospects of their entrepreneurial ventures.
- Offering funding and investment: Universities can create funding mechanisms specifically designed for graduate entrepreneurs. This may include grants, seed funding, or access to investor networks. Additionally, universities can establish angel investment or venture capital funds that provide financial support to promising startups founded by their graduates.
- Intellectual Property Support: Universities can help newly graduated entrepreneurs protect their intellectual property. This includes legal advice on patenting inventions, trademark registration, and copyrighting creative works. By offering this support, universities ensure that newly graduated entrepreneurs can protect their innovations and ideas.
- Alumni Networks and Mentorship: Universities can leverage their alumni networks to connect newly graduated entrepreneurs with successful alumni with experience in their respective industries. This mentoring relationship can provide valuable guidance, advice, and networking opportunities for aspiring entrepreneurs. Additionally, universities can organize alumni events and networking sessions to facilitate connections among newly graduated entrepreneurs.
- Fostering an Entrepreneurial Culture: Universities can foster an entrepreneurial mindset among their students by organizing events, competitions, and workshops focused on entrepreneurship. This can help students develop an entrepreneurial mindset, foster creativity and innovation, and inspire them to consider entrepreneurship as a viable career path.
- Participation in the local ecosystem: Universities can actively collaborate with local entrepreneurship ecosystems, such as government agencies, industry associations, and business development organizations. By collaborating with these actors, universities can create an enabling environment for graduate entrepreneurs, access additional resources, and take advantage of funding opportunities.
- Research and knowledge transfer: Universities can conduct entrepreneurship research and share the results with graduate entrepreneurs. This knowledge transfer can help startups make informed decisions, identify market trends, and develop innovative solutions. Furthermore, universities can encourage graduate entrepreneurs to participate in research projects, fostering a symbiotic relationship between academia and entrepreneurship.
In conclusion, universities and educational institutions play a critical role in supporting graduate entrepreneurial initiatives. By establishing entrepreneurship centers, offering courses and programs, creating incubators and accelerators, facilitating collaborations with industry, providing funding and investment opportunities, offering support for intellectual property, and interacting with the local ecosystem, universities can empower and support graduate entrepreneurs in their entrepreneurial journeys.
How can universities and educational institutions support postgraduate entrepreneurship initiatives?
Educational Institutions
Universities and educational institutions play a crucial role in fostering postgraduate entrepreneurship initiatives. By providing the right resources, support, and opportunities, they can help aspiring entrepreneurs turn their ideas into successful businesses.
Below are several ways universities can support graduate entrepreneurship initiatives:
- Incubation and acceleration programs: Universities can establish incubation and acceleration programs specifically designed to support graduate entrepreneurs. These programs provide physical space, infrastructure, mentorship, and access to a network of experts and investors.
Incubators typically support startups in their early stages, while accelerators focus on the growth of existing companies. These programs can help graduates develop their business ideas, refine their business models, and accelerate their growth.
- Entrepreneurship courses and curricula: Universities can offer entrepreneurship courses and incorporate business training across various disciplines. These courses can cover topics such as business planning, market research, financial management, innovation, and leadership. By providing a solid foundation in entrepreneurship, universities can equip graduates with the knowledge and skills necessary to launch and grow their own companies.
- Funding Opportunities: Access to capital is crucial for startups, and universities can help by offering funding opportunities to newly graduated entrepreneurs. This can be done through grants, scholarships, or seed funding. Universities can also establish partnerships with venture capitalists, angel investors, and crowdfunding platforms to facilitate startup funding. By providing financial support, universities allow graduates to focus on developing their businesses instead of worrying about funding constraints.
- Mentoring and Networking: Universities can connect newly graduated entrepreneurs with experienced mentors who provide guidance, advice, and industry-specific knowledge. Mentors can help entrepreneurs navigate the challenges of starting and running a business, avoid common pitfalls, and provide valuable perspectives based on their own experience. Additionally, universities can host networking events, workshops, and conferences where newly graduated entrepreneurs can connect with other entrepreneurs, industry professionals, and potential collaborators.
- Intellectual Property Support: Intellectual property protection is crucial for startups, safeguarding their innovations and giving them a competitive advantage. Universities can offer assistance with patents, copyrights, and trademarks to help newly graduated entrepreneurs protect their intellectual property. They can also provide legal advice and access to intellectual property experts who can guide entrepreneurs through the complex process of obtaining and managing their intellectual property rights.
- Industry Collaborations: Collaborating with industry partners can provide newly graduated entrepreneurs with practical experience, mentorship, and access to industry-specific resources. Universities can establish partnerships with local businesses, corporations, and industry associations to create internship programs, joint research projects, and industry-specific training programs. These partnerships can provide valuable industry insights, market opportunities, and potential customers for newly graduated entrepreneurs.
- Entrepreneurship competitions and events: Universities can organize entrepreneurship competitions and events that allow newly graduated entrepreneurs to present their business ideas, receive feedback, and gain exposure. These competitions can offer cash prizes, networking opportunities, and access to potential investors. By organizing these events, universities create a culture of entrepreneurship and encourage more students to explore business ventures.
- Alumni Support: Universities can leverage their alumni networks to support newly graduated entrepreneurs. Alumni who have successfully launched their own businesses can serve as mentors, provide funding, or offer internships and job opportunities to newly graduated entrepreneurs. Universities can also facilitate alumni networking events or establish entrepreneurship-focused networks to connect graduates with entrepreneurial ambitions.
In conclusion, universities and educational institutions can provide a variety of resources and support to help newly graduated entrepreneurs achieve success. By offering incubation and acceleration programs, entrepreneurship courses, funding opportunities, mentoring, networking, intellectual property support, industry collaborations, entrepreneurship competitions, and alumni support, universities can play a pivotal role in developing and growing the next generation of entrepreneurs.
What are the key steps to starting a successful business after graduation?
Key Steps to Starting a Successful Business After Graduation
Starting a successful business after graduation requires careful planning, dedication, and a solid understanding of the key steps in the process.
Below are several crucial steps to consider when embarking on this journey:
- Identify a Viable Business Idea: The first step is to brainstorm and identify a business idea that is unique and has the potential for success. Consider your passions, skills, and experience, and conduct market research to assess the demand and competition for your proposed idea.
- Develop a Business Plan: Once you have a business idea, it is essential to develop a comprehensive business plan. This plan should outline your target market, competitor analysis, marketing strategies, financial projections, and an operational plan. It will serve as a roadmap for your venture and help you secure funding from investors or lenders.
- Build a Strong Team: As an entrepreneur after graduation, it is crucial to build a capable and dedicated team. Identify people who bring complementary skills and share your vision and passion for the business. Each team member should have a clear role and responsibility within the project.
- Obtain funding: Funding is often one of the biggest challenges for newly graduated entrepreneurs. Explore various funding options, such as personal savings, grants, loans, crowdfunding, or angel investors. Prepare a compelling proposal to attract potential investors, highlighting the viability and profitability of your business.
- Register your business: Before launching your project, you must legally register it. Research your jurisdiction’s requirements and regulations, such as business licenses, tax registrations, and permits. Choose a name and business structure, such as a sole proprietorship, partnership, or limited liability company (LLC).
- Develop a marketing strategy: A well-defined marketing strategy is essential for attracting customers and generating revenue. Identify your target audience, develop a unique value proposition, and determine the best marketing channels to reach your customers. Use digital marketing techniques, social media, and traditional advertising methods to promote your business. 7. Build a strong online presence: In today’s digital age, having a strong online presence is crucial for success. Create a professional website showcasing your products or services and optimize it for search engines to improve visibility. Establish a strong social media presence to connect with your target audience and build brand awareness.
- Test and refine your product or service: Before launching your product or service to the general public, conduct extensive testing and gather feedback from potential customers. Incorporate their suggestions and make necessary improvements to ensure your offering meets their needs and expectations.
- Monitor your finances and profitability: Keep a close eye on your finances to ensure profitability and sustainability. Implement accounting software or hire an accountant to track income, expenses, and cash flow. Regularly review and analyze financial reports to identify areas for improvement and make informed decisions about the future of your business.
- Continuously learn and adapt: The entrepreneurial journey is a continuous learning experience. Stay up-to-date with industry trends, attend relevant workshops and seminars, and network with other entrepreneurs. Stay open to feedback and adapt your strategies as needed to stay competitive in the market.
In conclusion, starting a successful business as a graduate requires careful planning, execution, and continuous learning. By following these key steps and putting in the necessary effort and dedication, you can increase your chances of building a thriving and sustainable business.
Entrepreneurial Learning: All University Students Can Benefit
The following contribution corresponds to The Conversation, which defines itself as follows: The Conversation is a non-profit, open-access, and free-to-use editorial platform that provides the media and readers with informative articles and analyses written by the academic and research community.
Our team of editors, specialized journalists, supports and guides experts to convey their knowledge to readers in clear, concise, and accessible language.
Authorship
Esteban Daze, Dom Herrick, Entrepreneur in Residence and Visiting Professor, L’Université d’Ottawa/University of Ottawa
The University of Ottawa provides funding as a founding institution of The Conversation CA-FR.
Entrepreneurs, partner startups, and the resulting growth of their companies have a vital impact on the health of our economy.
In Canada, young adults have shown a growing interest in entrepreneurship.
Historically, entrepreneurship has been closely associated with traditional business schools and startups.
However, as the World Economic Forum has noted, “school systems must prepare students to work in a dynamic and rapidly evolving business and global environment.
This requires a complete paradigm shift for academia, including transforming the fundamentals of how schools operate and their role in society.”
Students in all faculties can and should benefit from entrepreneurial skills, classically defined as learning to create value in uncertain environments and with limited resources. Doing so will ensure our next generations can meet the challenges of tomorrow.
This has never been truer than now, as we grapple with the effects of the COVID-19 pandemic. It remains to be seen how the pandemic will interact with the changing workforce landscape.
Entrepreneurship in Universities
In the summer of 2021, my team at the University of Ottawa’s Telfer School of Management conducted a review, now published in English and French, of entrepreneurship activities at Canada’s 27 largest universities.
We set out to discover the number and type of entrepreneurship courses available, the opportunities for students to acquire this valuable skill outside the classroom, and current practices supporting student startups. We found encouraging insights and opportunities for improvement.
Surprisingly, we discovered an average of 22 entrepreneurship-focused courses per institution. Examined collectively, these courses spanned diverse faculties (including engineering, sciences, arts, and social sciences) and levels of study, from undergraduate to doctoral and postdoctoral.
A survey of 27 Canadian universities revealed that entrepreneurship-focused courses are offered in faculties including engineering, sciences, arts, and social sciences. (Telfer School of Management, University of Ottawa)
This is a dramatic increase in the number of entrepreneurship courses offered at institutions over the past decade. A similar 2014 review of entrepreneurship courses at 20 Ontario universities revealed an average of only 5.7 entrepreneurship courses per institution. In 2010, most institutions offered between one and five entrepreneurship courses.
Beyond Business Schools
Entrepreneurship is no longer the exclusive domain of business schools. Many schools are recognizing the importance of this skill set for students, and on average, 3.5 schools per university offer these types of courses.
Our review found positive indicators related to the number and type of entrepreneurship courses available.
Most have stopped offering business planning courses as a standard entrepreneurship offering.
There are now courses that focus on the early stages of startups, such as creativity, idea generation, opportunity identification, and how to validate them through customer conversations.
Startups, Social Entrepreneurship
Universities are finding ways to adapt traditional «big business» topics to startups. These approaches recognize that student-launched startups do not start with the money, staff, or resources that larger companies have, such as in courses on marketing for entrepreneurs, entrepreneurship law, and startup financing.
In addition, courses that were not traditionally offered outside of engineering programs are emerging in other schools. For example, courses on design thinking and new product development, software entrepreneurship, prototyping, and others.
The most frequently added course titles in recent years include those related to social entrepreneurship: startups that seek to help solve social problems and are not solely focused on profit. Students from all schools seek to solve real-world problems with unique business models.
The RBC Fast Pitch Competition showcases the top teams from two entrepreneurial thinking courses at the Haskayne School of Business.
Traditional classroom study isn’t the only way educational institutions can influence student learning.
Some examples include experiential programs, such as competitions where students can pitch ideas and meet potential company co-founders; skills-training workshops (available at most schools); student-organized conferences; Student clubs that promote entrepreneurship in diverse contexts and disciplines, from those who sell art to those who start a consulting practice or commercialize a discovery in health sciences.
Learning by Doing
Providing students with experiential learning opportunities allows for experimentation, skill application, and valuable networking.
These hands-on learning activities have been proven to boost the development of many important entrepreneurial skills.
Other non-credit learning programs are also encouraged, such as opportunities for students to meet external entrepreneurs.
Our data showed that, between summer 2020 and summer 2021, internships, where students could work on their own startups, gained popularity. In 2020, only 43% of the schools we analyzed offered such internships, but in 2021, 70% did so.
The prevalence of support for student startups is encouraging. Every year, an increasing number of students are starting their businesses while pursuing their academic studies.
Creating Value
Almost every university offers some form of incubation service: programs that give students access to mentorship, investors, and other support to help them establish their early-stage companies.
Most offer more than one such program. In addition to mentorship, student support can include consulting services, funding, training, and a workspace.
Many student entrepreneurs sell valuable products and services in our communities and beyond, in addition to creating jobs.
For example, in 2018, the University of Toronto reported that its nine incubators and accelerators across three campuses helped launch more than 150 companies in the past five years and generated more than $500 million in investments.
Students who participate in these successful initiatives graduate and join their current businesses, creating their own rather than seeking employment upon graduation.
Expanding Access to All Students
Student interest, donor funding, and economic imperatives continue to drive entrepreneurial interest and activity in universities, and some very good practices exist.
Still, many institutions still have much work to do to ensure that all students, regardless of their faculty or career aspirations, have access to essential entrepreneurial skills.
Universities must continue to seek to redefine who they teach, establish what they teach, and ultimately
International Graduate Students and Startup Creation in the US
The following contribution corresponds to the CEPR portal, which is defined as follows: The Center for Economic Policy Research (CEPR) was founded in 1983 to improve the quality of economic policymaking in Europe and the rest of the world by promoting high-quality, policy-relevant economic research and disseminating it widely to decision-makers in the public and private sectors. Drawing on the expertise of its researchers and affiliates, CEPR initiates, funds, and coordinates research activities and communicates results quickly and effectively to policymakers and other decision-makers around the world. The Center is an independent, non-profit organization and does not take any institutional political stance.
The authors are
Michel Beine
Giovanni Peri
Morgan Raux /
Approximately 300,000 foreign students obtained visas annually to enroll in graduate programs in the U.S. over the past decade. This column concludes that the small percentage of foreign students who remained in the U.S. after earning their master’s degrees contributed significantly to the creation of new startups.
Since startups and new companies are drivers of economic growth and technological innovation, the authors recommend reducing barriers to enrollment, while increasing access to scholarships and financial support for those who create local startups, and expanding policies that allow graduates to remain in the U.S. after graduation.
From Levi Strauss & Co., a company founded by a German immigrant whose name became synonymous with jeans in the 20th century, to Google, Amazon, and Uber, many of the most recognizable U.S. companies were founded by immigrants or children of immigrants who achieved the American Dream through successful entrepreneurship and innovation (Mishra et al., 2023).
New ventures are key drivers of technological innovation, which is one of the primary growth engines of the U.S. economy.
New ventures and startups bring substantial, high-potential innovations to market.
In the process, they contribute to U.S. job growth, real output, and productivity (Haltiwanger et al., 2016).
They also tend to hire highly skilled workers and often pay higher wages than other firms (Kolev et al., 2022).
More than half of innovative American entrepreneurs (54% of Fortune 500 companies, according to Forbes) hold a U.S. graduate degree, suggesting that American universities are important generators of innovation.
The prominent role that American universities play in fostering innovation is no coincidence.
The United States has long been home to the world’s top universities: most rankings show that American universities have accounted for the majority of the world’s top 10, 50, and 100 universities for decades (Urquiola and McLeod, 2021).
Likely due to their recognized quality, American universities attract highly talented individuals from around the world, training them for leadership positions in science, technology, and management.
Over the past decade, approximately 300,000 foreign-born graduate students annually obtained a visa to enroll in a U.S. graduate program.
Some remained in the United States for at least a few years after earning their degrees.
In a new study (Beine et al., 2024), we quantify how international students who earned a master’s degree in the United States contributed to the creation of new startups in that country between 1999 and 2019.
Our analysis includes a large representative sample of startups obtained from Crunchbase, the most comprehensive online database of startups in the United States, and includes information on founders, their highest degree, and the university from which they graduated.
We combine this data with data from the International Postsecondary Education Data Set (IPEDS), which provides annual measurements of the number of international and native students enrolled and graduated from each university and program.
Using this data, for each cohort of university master’s degree graduates (e.g., master’s students who graduated in 2001 from MIT or in 2007 from UC Berkeley), we investigate the relationship between the frequency of startup creation in the five years after graduation and the proportion of international master’s students in a cohort.
Causally identifying this relationship is challenging, as the choice of where and when to enroll in a master’s program is not random, especially for international students, who consider several options.
For example, enrollment decisions may be correlated across locations and over time with startup concentration (e.g., Silicon Valley universities may attract prospective master’s students in engineering or business).
To avoid spurious correlations between the share of foreign graduates and startup intensity, we leveraged variation in out-of-state tuition rates within each university over time.
In our analysis, we showed that lower tuition rates increased international student enrollment and were uncorrelated with preexisting local economic conditions. Using this tuition structure as an instrumental variable, we isolated tuition increases in response only to tuition changes and tracked their impact on new startup creation, while excluding other potential contributing factors, such as the state of the local economy.
Key Findings
Our estimates imply that 10,000 additional international MBA graduates would generate 61 additional MBA student startups registered in Crunchbase within five years of that cohort’s graduation.
This is significantly higher than the simple average startup rate of MBA students in our sample and reflects a combination of direct effects and spillovers to startup creation by classmates.
This result is consistent with studies showing that immigrants in general, and international students in particular, are overrepresented among entrepreneurs in the US (Azoulay et al., 2022; Anderson, 2022; Kerr, 2013; Kerr and Kerr, 2020).
Crunchbase registrations tend to overrepresent the most successful startups, with 98% of our sample surviving at least three years. Therefore, this effect is even more significant than simply adding startups, many of which fail to thrive.
Moreover, the increase in international students not only increased startup rates, but also, specifically, those of highly valuable and innovative startups.
There was a significant boost for startups that raised $25 million or more in capital during the first three years of their inception (38 additional companies per 10,000 foreign MBA graduates) and for startups that filed at least one patent in the first three years (eight additional companies per 10,000 foreign MBA graduates).
After determining this overall effect, we analyzed the channels driving this increase in the startup rate. While we have a precise measurement of international students in each MBA cohort, we used imputed measures to determine whether a founder is more likely to be of foreign or native origin, using founders’ first and last names from Crunchbase.
This algorithm (taken from forbears.com) uses the distribution of names around the world to determine the foreign-born or native-born status of American startup founders.
In the US, more than in other countries, this method may overestimate the number of foreign-born, given the large presence of second- and third-generation immigrants. However, we decompose the impact of a higher proportion of foreign-born master’s students in a class on the increased entrepreneurship of individuals with foreign-born names—a likely combination of first- and later-generation immigrants—and those with American-born names (likely native-born Americans).
We find that between 30% and 45% of the additional startups generated by a higher proportion of international students were founded or co-founded by individuals of American origin.
This group, likely composed of individuals born in the United States, could have increased their propensity to start a company by interacting with international students, who bring different ideas and a greater inclination toward entrepreneurship.
Their presence could also contribute to establishing more international connections, which could benefit startups with US-born founders.
While previous studies from other countries have found significant entrepreneurial spillovers from immigrants and emigrants (e.g., Anelli et al., 2023 for Italy), this is the first article to find a similar result in the US context.
University Quality Drives Local Innovation
The high quality of American university master’s programs was undoubtedly a determining factor both in attracting talented international students and in fostering the creation of innovative companies after graduation.
The greatest entrepreneurial potential among master’s graduates overall came from those who graduated from R1-R2 research universities (i.e., those more research-focused and offering master’s and doctoral programs), especially in STEM fields.
However, the graduation of international students in non-STEM fields also has a strong impact on startup creation.
International master’s students at research-intensive institutions increased the number of startups among their own students at an even greater rate.
This is likely because these universities attract the most talented students globally.
While business master’s graduates represent the largest proportion of total startup entrepreneurs, graduates of programs in computer science, physical sciences, life sciences, and biomedical sciences also contribute significantly to startup creation.
The majority of these new startups (97%) are located in the same state as the university where the students earned their master’s degree. This means that high-quality universities generate high added value for local communities by attracting international talent and retaining some of their business creation potential locally. This result sheds new light on the positive impact of universities on innovation (Stuen et al., 2012).
Policies to Retain Talent in the U.S.
These figures are particularly impressive considering that only a small percentage of international students with a U.S. master’s degree remain in the country after graduation.
In a previous study (Beine et al., 2023), we found that, due to visa and immigration restrictions, only 20% of international master’s degree graduates in the United States stay and work in the country for at least two years.
Some return home, while others go to countries with more open immigration policies for highly skilled workers, such as Canada or Australia.
The direct effect on startup creation in the United States would likely be even greater if more international MBA students were allowed to remain in the country.
The rising cost of studying in the United States, as well as restrictions on the number of graduates who can remain—due to H1-B visa limitations and a lack of other visa or permanent residency opportunities—could reduce the influx of these students and limit the entrepreneurial benefits observed in this study.
These already significant benefits of international MBA students suggest that the U.S. government and top universities could take several steps to retain talented graduates and thus further benefit from international student entrepreneurship.
Reducing barriers to enrollment, increasing access to financial grants and support for those who create local startups, supporting/expanding policies that allow graduates to remain in the U.S. after graduation by extending the optional practical training visa to self-employed workers, and expanding the duration and scope of international business visas could have significant effects in helping to maintain and strengthen U.S. leadership in business and innovation.