The Power of Adversity Muscle

We invest in companies founded by immigrants. Are we Anti-American? It’s the opposite: Unshackled Ventures supports foreign-born entrepreneurs at the earliest stages because they are likely to set up successful, high-growth companies in the U.S.

We know this from experience. As venture investors, we spent years examining startups for indicators of future success. We soon recognized a familiar pattern – immigrant founders consistently proved to be savvy, determined and energetic.

Unshackled began to call this combination of tested grit, resiliency and determination, “adversity muscle.” For many entrepreneurs, it is this that sets their companies apart.

Immigrant founders have traveled far to be in America – not just in miles, but in life experiences. From small, impoverished villages or war-torn countries, many immigrants beat the odds to make it to our shores.

The distance they’ve traveled is correlated to the adversity they’ve faced and the muscle they’ve built. In leaving their homeland, immigrants arrive in a new country as nobodies: no financial stability, no personal networks, and often, no support structure. Their only choice is to begin working hard and hope for success or they’ll find themselves on a return flight home.

It’s a high stakes game: Go big or go home.

That’s why we’ve found the best founders are those who have overcome challenges and bounced back – immigrants or not. But having endured a variety of challenges coming to America, foreign founders don’t expect a smooth road to success. They will withstand hearing, “No.” to eventually arrive at the all-important “Yes.”

At Unshackled, we see adversity muscle at work in the companies we back every day.

Of course, few business leaders walk a straight path. Everyone zigs and zags on the path to success. But the fact is, most immigrants have encountered tougher zags. One of our portfolio founders grew up in village without reliable access to water. Instead of giving in, he became an expert in technology and business. By age 28, he received his master’s degree from USC, published seven books on artificial intelligence (AI) and is now leveraging AI to help American water facilities prevent infrastructure failures and save billions – in both water and profit, annually. His life experiences shaping his grit and determination.

I’m a first generation American. After working with my co-founder, Nitin Pachisia, and other immigrant entrepreneurs, I’ve gained tremendous empathy for adversity muscles– including those of my parents. I never fully appreciated the struggles they must have endured as they settled our family in the U.S.

Today, Unshackled’s portfolio has founders hailing from each of the six inhabited continents. They come from 16 countries and speak 30 unique languages. They all immigrated to pursue their American dream.

The shared characteristic of these entrepreneurs – and all successful people– is someone believed in them early on. Unshackled plays the role of believer in their entrepreneurial lives. We know the power and energy of our founding teams is unmistakable.

And we have the numbers to prove it. We’ve seen our immigrant founders thrive in this environment. In three years, Unshackled’s fund performance is in the top decile of those started in 2014 and boasts one of the lowest failure rates. Supporting immigrant early-stage entrepreneurs works.

The U.S. has a tradition of being the land where the best in the world come to build businesses that benefit everyone. More than 40 percent of Fortune 500 companies were founded by immigrants or children of immigrants. But that trend has changed and we’re not reticent to say that the American immigration policy is broken. We have spoken out and called for policy changes needed to encourage the best foreign students and workers to settle and innovate here, not back in their home country – a proven job creation strategy.

The determination and brilliance of immigrant business-people helped make America one of the most competitive countries in the world. At Unshackled, our goal is to create 100,000 domestic jobs. Someday, we will hear an American from our heartlands go on TV thanking an immigrant entrepreneur for putting food on their dinner table. The common denominator? Both employer and employee have the adversity muscle to succeed.

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