Immigrant women fuel small business growth in US

America
Immigrant women fuel small business growth in US
By Arun Kumar, IANS, Mar 3, 2007 - 11:43:11 AM

Washington, March 3 - Immigrant women from India and other parts of the world are one of the fastest-growing segments of small business owners in the United States, according to a new study.

These women can expect to be a sizeable portion of small business owners by 2017 with 36 million immigrants of either sex having higher rates of starting new businesses than native-born Americans, according to Intuit Inc.'s Future of Small Business Report, co-authored by the Institute for the Future.

Robert Fairlie, an economist who produces the Kauffman Index of Entrepreneurial Activity, notes that each month over the last three years, 310 of every 100,000 immigrant women created a business, while 220 of 100,000 native-born women did so.

In other words, immigrant women are starting businesses at a rate 41 percent higher than native-born women.

They do it for a variety of reasons: for flexibility to raise children, to avoid barriers that come with traditional jobs, or because their skills do not translate well into corporate America.

Small businesses employ slightly more than half of all US private-sector workers, and these women are staking their place in the economy as job creators.

Asa Kalavade, raised in India, for one co-founded Tatara Systems Inc., a Massachusetts-based technology business that employs 65 people. Kalavade said in India she felt societal pressure to study something more 'woman-friendly' than engineering.

After earning a graduate engineering degree at University of California, Berkeley, she stayed in the United States to work at Bell Labs Research before setting off on her own.

Starting her own business was not easy. Kalavade estimates that from 1999 through 2001, some 40 venture capitalists turned her down when asked if they would exchange startup money for equity in the company.

She and her co-founder, a woman from China, did not give up, and, eventually, investors helped them start Tatara. Fairlie would say Kalavade is daring by nature. 'To leave your own country and come at great cost to another country, that's self-selecting' for entrepreneurial spirit, he said.

Today, Kalavade holds eight patents for wireless technologies. One of her patents is for technology that allows consumers to receive phone calls to their mobile phones on their computers. 'I didn't want to do pie-in-the-sky research,' she said.

Immigrant women are 'prone to taking risks,' said Farhana Huq, of CEO Women, a San Francisco nonprofit that helps low-income immigrant women start businesses. 'They really just put themselves on the line.'

Immigrant women have advantages in a global marketplace, the Intuit study says; language skills and relationships from home countries help them find suppliers and customers.

Even though only two out of 10 of all small businesses succeed in their first year, immigrants might have an advantage, said Steve King, senior advisor at the Institute for the Future and study co-author.

'Immigrants are more attuned - often more than natives - to the opportunity in America,' he said, 'and women increasingly start businesses to avoid the corporate 'glass ceiling.' These motivating factors lead to a higher rate of success.'

The report identifies three major trends: the changing face of small business, the rise of personal business and the emergence of entrepreneurial education. Those trends led to five major findings:

* Entrepreneurs will no longer come predominantly from the middle of the age spectrum, but instead from the edges. People nearing retirement and their children just entering the job market will set the bar as the most entrepreneurial generation ever.

* American entrepreneurship will reflect a huge upswing in the number of women. The glass ceiling that has limited women's growth in traditional corporate career paths will send a rich talent pool to the small business sector.

* Immigrant entrepreneurs will drive a new wave of globalisation. US immigration policy and the outcome of the current immigration debates will affect how this segment performs over the next decade.

* Contract workers, accidental and social entrepreneurs will fuel a proliferation of personal businesses. Economic, social and technological change - and an increased interest in flexible work schedules - will produce a more independent workforce seeking a better work-life balance.

* Entrepreneurship will be a widely adopted curriculum at educational, trade and vocational institutions. As a result, artists, musicians and others not traditionally exposed to business education will learn not just their trade but small-business management skills as well.

* Indo-Asian News Service

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