Post on 08-Apr-2018
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
1/24April 2011
The Grass is Indeed Greener in Indiaand China for Returnee Entrepreneurs
Authors:Vivek Wadhwa
Sonali JainAnnaLee Saxenian
Gary GerefHuiyao WangAmericas New Immigrant Entrepreneurs, Part VI
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
2/24
The Grass is Indeed Greener in India and Chinafor Returnee Entrepreneurs
Americas New Immigrant Entrepreneurs, Part VI
April 2011
Vivek WadhwaVisiting Scholar, School o Inormation, UC Berkeley;
Director o Research, Center or Entrepreneurship and Research Commercialization,Duke University; Senior Research Associate, Harvard Law School
Sonali JainPostdoctoral Associate, Social Sciences Research Institute, Duke University;
Visiting Scholar, Center on Globalization, Governance & Competitiveness, Duke University
AnnaLee SaxenianDean, School o Inormation, and Proessor, UC Berkeley
Gary Gereffi
Proessor o Sociology and Director o the Center on Globalization,Governance & Competitiveness, Duke University
Huiyao WangVisiting Fellow, Harvard Kennedy School, Harvard University;
Director-General, Center or China and Globalization
Student researchers
Pravar VijayvargyaYing HanPu Chen
Chibulu Alice Luo
2011 by the Ewing Marion Kauman Foundation. All rights reserved.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
3/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S
T a b l e o f C o n t e n t s
Table of Contents
INTRODUCTION ........................................................................................................................................................................3
OUR FINDINGS ...........................................................................................................................................................................4
BACKGROUND OF RESPONDENTS........................................................................................................................4
CHARACTERISTICS OF COMPANIES STARTED IN INDIA/CHINA ..........................................................................4
WHY DID THEY RETURN? ......................................................................................................................................4
PERSONAL COMPARISONS: THE UNITED STATES VS. INDIA/CHINA ...................................................................5
ADVANTAGES OF DOING BUSINESS IN INDIA AND CHINA ...............................................................................5
THE AMERICAN ADVANTAGE ................................................................................................................................5
THE VALUE OF NETWORKS ....................................................................................................................................5
TIES TO THE UNITED STATES .................................................................................................................................6
CONCLUSIONS ...........................................................................................................................................................................6
METHODOLOGY ........................................................................................................................................................................8
BACKGROUND OF RESPONDENTS........................................................................................................................8
CHARACTERISTICS OF COMPANIES STARTED .......................................................................................................9
Figure 1. Age Distribution o Businesses Started ............................................................................................9
Figure 2. Distribution o Kinds o Incorporation ............................................................................................9
Figure 3. Industry Distribution o Businesses .................................................................................................9
Figure 4. Location Distribution o Businesses ..............................................................................................10
Figure 5. Size Distribution o Businesses .....................................................................................................10
Figure 6. Distribution o Initial Funding Sources .........................................................................................11
Figure 7. Distribution o Subsequent Funding Sources ................................................................................11WHY DID THEY RETURN? ....................................................................................................................................12
Figure 8. Availability o Economic Opportunities(Distribution o Degrees o Importance) ........................................................................................12
Figure 9. Family Ties(Distribution o Degrees o Importance) ........................................................................................12
Figure 10. Access to Local Markets(Distribution o Degrees o Importance) ........................................................................................12
Figure 11. Contributing to Home Countrys Economic Development(Distribution o Degrees o Importance) ........................................................................................13
Figure 12. Lower Business Costs(Distribution o Degrees o Importance) ........................................................................................13
Figure 13. Government Incentives(Distribution o Degrees o Importance) ........................................................................................13
Figure 14. Expiration o U.S. Visa(Distribution o Degrees o Importance) ........................................................................................14
ADVANTAGES OF DOING BUSINESS IN INDIA AND CHINA .............................................................................14
Figure 15. Operating Costs(Distribution o Degrees o Importance o Advantage) ..................................................................14
Figure 16. Employee Wages(Distribution o Degrees o Importance o Advantage) ..................................................................14
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
4/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S2
T a b l e o f C o n t e n t s
Figure 17. Access to Local Markets(Distribution o Degrees o Importance o Advantage) ..................................................................15
Figure 18. Availability o Qualiied Workers(Distribution o Degrees o Importance o Advantage) ..................................................................15
Figure 19. Mood in the Country(Distribution o Degrees o Importance o Advantage) ..................................................................15
Figure 20. Inrastructure (Power, Water, Broadband)(Distribution o Degrees o Importance o Advantage) ..................................................................16
Figure 21. Government Support(Distribution o Degrees o Importance o Advantage) ..................................................................16
PERSONAL COMPARISONS: THE UNITED STATES VS. INDIA/CHINA .................................................................16
Figure 22. Opportunities to Start a Business
(Distribution o Comparisons) .......................................................................................................16Figure 23. Speed o Proessional Growth
(Distribution o Comparisons) .......................................................................................................17
Figure 24. Quality o Lie(Distribution o Comparisons) .......................................................................................................17
Figure 25. Proessional Recognition(Distribution o Comparisons) .......................................................................................................17
THE AMERICAN ADVANTAGE ..............................................................................................................................18
Figure 26. Salary Received(Distribution o Comparisons) .......................................................................................................18
IMPORTANCE OF NETWORKS IN HOME COUNTRY...........................................................................................18
Figure 27. Business Networks
(Distribution o Degrees o Importance o Advantage) ..................................................................18Figure 28. Personal/Family Networks
(Distribution o Degrees o Importance o Advantage) ..................................................................18
Figure 29. Alumni Networks(Distribution o Degrees o Importance o Advantage) ..................................................................19
Figure 30. Ties to Government Oicials(Distribution o Degrees o Importance o Advantage) ..................................................................19
TIES TO THE UNITED STATES ...............................................................................................................................19
Figure 31. Indian Returnees Contacts with Colleagues, Friends,Family, and Organizations in the United States(Distribution o Frequency by Contact Type) ................................................................................20
Figure 32. Chinese Returnees Contacts with Colleagues, Friends,
Family, and Organizations in the United States(Distribution o Frequency by Contact Type) ................................................................................20
Figure 33. Indian Returnees Exchange o Proessional Inormationwith People/Organizations in the United States(Distribution o Frequency by Contact Type) ................................................................................21
Figure 34. Chinese Returnees Exchange o Proessional Inormationwith People/Organizations in the United States(Distribution o Frequency by Contact Type) ................................................................................21
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
5/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S
Anecdotal evidence indicates that large numbers
of skilled workers have returned home from the
United States to countries such as India and China.
There are no hard data available, but most authorities
agree that the numbers returning per year are in
the tens of thousands. For example, the Chinese
Ministry of Education estimates that the number of
overseas Chinese who returned to China in 2009
having received a foreign education reached 108,000:
a sharp increase of 56.2 percent over the previous
year. In 2010, this number reached an all-time high of
134,800.1 Our earlier research2 had estimated that,
as of October 2006, waiting for a yearly allocation of
120,000 permanent-resident visas were 1,055,084
employment-based principals in the focal employment
categories and their family members residing in the
United States. We had speculated that these workers
might get frustrated at the wait and return to their
home countries, producing a reverse brain drain.
In 2008, our surveys3 of 1,203 Indian and Chinese
immigrants who had worked in or received their
education in the United States and returned to their
home countries revealed that, although restrictive
immigration policies had caused some returnees to
depart the United States, the most significant factors in
the decision to return home were career opportunities,
family ties, and quality of life. We learned that a
majority of these returnees to India and China aspired
to start businesses within five years.
We decided to research this further by surveying
a select group of Indian and Chinese immigrant
professionals who had returned from the United States
to their home countries and started businesses there.
We wanted to learn the following:
WhydidtheseentrepreneursreturnfromtheUnited
States to India and China?
Whataretheirperceptionsoftheentrepreneurial
climate in their home countries?
Accordingtothem,whataretheadvantagesand
disadvantages of working in India and China over
working in the United States?
DotheymaintaintransnationaltiestotheUnited
States upon return?
We obtained responses to a detailed online survey
from 153 such professionals in India and 111 in
China. The survey was conducted from September
2010 to March 2011. In the absence of a census on
returnees in India and China, our sample was not a
random one. We selected, recruited, and researched
the backgrounds of respondents via LinkedIn, an
online network of more than 90 million experienced
professionals and managers worldwide that provides
a valuable source of information on these types of
workers. We contacted the returnees through LinkedIn
and by e-mail. We also obtained the assistance of
several industry associations in India and China to help
us connect with returnees through their own networks.
Though our findings may not generalize to all highlyeducated returnee entrepreneurs, we believe they are
representative of the professionals who are returning to
India and China and starting high-tech ventures there.
We required that survey respondents meet the
following criteria:
thattheentrepreneurbeofIndian/Chineseorigin
andhadfoundedorco-foundedhis/hercurrent
companyinIndia/China;
1. Xinhua News Net, March 18, 2010; Xinhua News Net, March 3, 2011.
2. Wadhwa, Vivek; Jasso, Guillermina; Rissing, Ben; Gerei, Gary; and Freeman, Richard B., Intellectual Property, the Immigration Backlog, and a Reverse Brain-Drain: Americas New Immigrant Entrepreneurs, Part III. August 22, 2007. Available at SSRN: http://ssrn.com/abstract=1008366.
3. Wadhwa, Vivek; Saxenian, AnnaLee; Freeman, Richard B.; and Gerei, Gary,Americas Loss is the Worlds Gain: Americas New Immigrant Entrepreneurs, Part 4. March 2, 2009. Available at SSRN: http://ssrn.com/abstract=1348616.
The Chinese Ministry of Education estimates that the number of overseas
Chinese who returned to China in 2009 having received a foreign educationreached 108,000: a sharp increase of 56.2 percent over the previous year.
Introduction
I n t r o d u c t i o n
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
6/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S4
O u r F i n d i n g s
thattheentrepreneurhadbeenmanaginghis/her
companyinIndia/Chinaforatleastayearatthe
timeoftakingthesurvey,inorderthathe/shebe
abletolookbackonhis/heradaptationprocess
with some temporal certainty and to reflect on the
challenges and advantages of managing a company
inIndiaandChina;and
that,priortomovingtoIndia/China,therespondent
had studied in the United States full time as an
undergraduateorgraduatestudentand/orhad
worked in the United States for at least one year.
Our FindingsBackground of respondents
Inoursample,themajorityofrespondentswere
in their mid-thirties. The average age of both Indianrespondents and Chinese respondents was
thirty-seven years.
Ninety-threepercentofIndianand89percentof
Chinese respondents were male.
Onaverage,Indianrespondentshadstudiedinthe
UnitedStatesfor1.8years;Chinese,for4.2years.
Indians had lived as professionals for an average of
fiveyearsintheUnitedStates;Chinese,4.9years.
Fifty-sixpercentofIndianand24percentofChinese
returnees moved to the United States with their
families and subsequently returned with them to
their home countries.
Characteristics of companies started inIndia/China Mostcompaniesstartedbythereturneeswereless
than five years old.
Fewcompanies26percentofIndianrespondents
and10percentofChineserespondentswere
family-owned.
Fifty-sixpercentofIndiancompanies,butonly33 percent of Chinese ones were in the informationtechnology (IT) sector. The rest were in a wideassortment of industries.
MoststartupswereinIndiasandChinasmajor
cities. SeventypercentoftheIndiancompaniesand
64 percent of the Chinese companies in our sample
had two to fifty employees. Sixteen percent of Indianand of Chinese companies had more than 100employees.
Eighty-sixpercentofIndiancompaniesand73 percent of Chinese ones had been funded
initially by personal savings. A far higher proportionof Chinese companies (19 percent) than of Indianones (5 percent) had obtained initial venture capitalfunding.
Why did they return? ThemostsignificantfactorsdrawingbothIndians
and Chinese home were economic opportunities,access to local markets, and family ties.
More than 60 percent of Indian and 90 percentof Chinese respondents said the availability of
economic opportunities in their countries was avery important factor.
The Chinese ranked local markets as veryimportant reasons far more commonly than theIndiansdid(Indians,53percent;Chinese,
78 percent).
And, consistent with our previous research onwhy Indian and Chinese immigrants return totheir home countries, more Indian (76 percent)than Chinese (51 percent) respondents considered
family ties as very important in motivating theirreturn.
Thereturneestookprideincontributingtotheirhomecountryseconomicdevelopment.Morethan60 percent of Indians and 51 percent of Chinese
rated this as very important.
The most significant factors drawing both Indians and Chinese home wereeconomic opportunities, access to local markets, and family ties. More than60 percent of Indian and 90 percent of Chinese respondents said the availability
of economic opportunities in their countries was a very important factor.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
7/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S
O u r F i n d i n g s
GovernmentincentiveswerefarmoreimportanttoChinese than to Indian returnees. Only 4 percent ofIndians ranked them as very important, but23 percent of Chinese respondents did.
Visaswereaveryimportantinfluenceonthedecision to return by only 9 percent of the Indiansand of the Chinese in this cohort.
Personal comparisons:the United States vs. India/China Surprisingly,72percentofIndianand81percentof
Chinese returnees said that the opportunities to starttheir own businesses were better or much better
in their home countries. Only 14 percent of Indiansand 5 percent of Chinese said that opportunities hadbeen better in the United States.
Speedofprofessionalgrowthwasalsobetterbackhome for the majority of Indians (54 percent) andChinese (68 percent).
Fifty-sixpercentofIndiansand59percentofChinese enjoyed a quality of life back home thatwasbetteroratleastequaltowhattheydenjoyedintheUnitedStates;43percentand40percent,respectively, found it better in the United States.
Sixty-fourpercentofIndiansand83percentof
Chinese said professional recognition was aboutthe same or better in their home countries as intheUnitedStates;34percentand15percent,respectively, said it was better in the United States.
Advantages of doing businessin India and China AmongIndians,thestrongestcommonadvantage
to entrepreneurs who had moved home was loweroperatingcosts;amongChinese,itwasaccesstolocal markets.
In India, 77 percent ranked operating costs and72 percent ranked employee wages as veryimportant advantages. In China, 64 percent and61 percent, respectively, did.
In China, 76 percent ranked access to localmarkets as very important. In India, 64 percent did.
Availabilityofqualifiedworkerswasperceivedasamore significant advantage in India than in China,with 60 percent in India and 43 percent in Chinaregarding it as very important.
IndiansandChineseboth(55percentand53 percent, respectively) saw the mood in theircountries as a very important advantage.
FarmoreChineseconsidergovernmentsupportveryimportant than do Indians (7 percent of Indian and31 percent of Chinese respondents).
AminorityofIndians(31percent)andChinese(35percent)rankedtheircountrysinfrastructureas
very important.
The American advantage Theonlyadvantagerespondentstypicallyindicated
that the United States offered lay in the salariesreceived64percentofIndianrespondentssaidthesalaries had been better in the United States thanthey were at home. Forty-three percent of Chineserespondents stated that salaries had been betterin the United States, while 20 percent stated thatthey were about the same in China and the United
States.
The value of networks Businessnetworkswereconsideredveryimportant
by 81 percent of Indians and 91 percent of Chinese.
Personal/familynetworkswereregardedasveryimportant more frequently by Chinese (74 percent)
than by Indians (60 percent).
Indianrespondentslesscommonly(28percent)regarded ties to government officials as veryimportant than did the Chinese (48 percent).
Fifty-onepercentofIndiansand45percentof
Chinese considered alumni networks to be veryimportant.
Seventy-two percent of Indian and 81 percent of Chinese returnees said thatthe opportunities to start their own businesses were better or much better in
their home countries. Only 14 percent of Indians and 5 percent of Chinesesaid that opportunities had been better in the United States.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
8/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S6
C o n c l u s i o n s
Ties to the United States BothIndiansandChinesemaintainedstrongcontacts
with former colleagues and family and friends in the
United States.
Eighty-four percent of Indian returnees maintained
monthly or more frequent contact with family and
friends, and 66 percent maintained contact of that
frequency with their former colleagues.
Eighty-one percent of Chinese returnees
maintained at least monthly contact with family
and friends, and 55 percent maintained contact of
that frequency with their former colleagues.
Chinesereturneesmaintainedstrongercontactswith
United States ethnic and educational organizations
than Indian returnees did.
Only 7 percent of Indian respondents, but
19 percent of Chinese ones maintained at least
monthly contact with ethnic organizations.
Twenty-five percent of the Indian and half of the
Chinese respondents maintained contact every six
months or more frequently with these groups.
Seventeen percent of Indian and 34 percent of
Chinese respondents maintained at least monthly
contact with educational institutions.
Thirty-sevenpercentofIndiansmademonthly
or more frequent contact with professional
organizations, as did 45 percent of the Chinese.
Thediscussionsthatreturneesengagedinmonthly
or more frequently with their contacts in the United
Stateswereaboutcustomers(Indians,61percent;
Chinese,74percent),markets(Indians,62percent;Chinese, 71 percent), technical information (Indians,
58percent;Chinese,68percent),jobopportunities
(Indians, 35 percent;Chinese,55percent),and
businessfunding(Indians,31percent;Chinese,
54 percent).
Overtheprevioustwoyears,Indianreturneeshad
travelled to the United States or abroad for work
purposesonaverage2.5times;Chinesereturnees,
4.3 times.
ConclusionsAs recently as the 1990s, we talked about a
brain drain. The great majority of U.S.-educated
professionals from places such as India and China
remained in this country to work at research labs,
universities, and private companies. Most stayed inthe United States for the remainder of their careers
because the economic and professional opportunities
here were more attractive than in their home countries.
SomeparticularlythoseintechnologyregionssuchasSiliconValley,Boston,andSeattlepioneeredawave
of new immigrant entrepreneurship. Few returned
home permanently.
This pattern changed abruptly in the 2000s, with
U.S.-educated immigrants returning to their home
countries in growing numbers. Many were attracted
by jobs in established firms, but a significant cohort istrying its hand at entrepreneurship. This survey offers
an invaluable glimpse into the motivations of these
professionals who are starting businesses in China and
India after studying and working in the United States.And, though it reveals interesting differences between
Indian and Chinese returnees and the contexts of
entrepreneurship in their home countries, the most
significant themes that emerge from the survey results
are the commonalities between these two groups.
The entrepreneurs in this survey are strikingly
similar to their U.S.-based counterparts: They areoverwhelmingly male, and most are bootstrapping
businesses with personal savings and funds from family
and friends. Their businesses are small, relatively new,
and focused on fast-growing, low-barrier-to-entrymarkets in IT and the service sectors. Finally, most are
incorporating their businesses as limited-liability orprofessionalcorporationsratherthanadoptingthe
model of the family-owned firm that was dominant
historically in both China and India.
These returnees identify economic opportunities,
the opportunity to start a business, and the speed ofprofessional growth as the leading motivations for
returning home. They rank these factors well above
others such as lower business costs or government
incentives, the expiration of U.S. visas, and the
The entrepreneurs in this survey are strikingly similar to their U.S.-basedcounterparts: They are overwhelmingly male, and most are bootstrappingbusinesses with personal savings and funds from family and friends.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
9/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S
C o n c l u s i o n s
opportunity to contribute to domestic economic
development. For Indians, family ties also are a major
motivation to return, and, for Chinese, access to the
large domestic market looms large. Clearly, the rapid
growth of the Chinese and Indian economies has
created professional and entrepreneurial opportunities
thatdidntexistinpriordecades.
The calculations in this report parallel those of
prior generations of U.S.-educated professionals who
returned to Taiwan and Israel in the late 1980s and
1990s. In both eras, the pull of economic growth
at home, and the professional opportunities that
growth generates, loom significantly larger than policy
measures in either the United States or abroad. It is
worth noting, in addition, that in both cases, the timing
of these reversals also corresponds to periods of
economic downturn in the United States that diminish
the professional opportunities for immigrants.
Moreover, the factors that led to the original brain
drainrelativepovertyandunderdevelopmentare
now sources of competitive advantage for India and
China. Return entrepreneurs in both countries identify
lower operating costs, lower salaries, and access to the
domestic market as the most important advantages
of doing business at home rather than in the United
States. The availability of qualified workers and the
mood in the country also are advantages to both.
And, though scholars and the media often highlight
the role of government policy in attracting or repelling
talent, the survey respondents rank infrastructure
and government support as the least-important
considerations for doing business in India or China
relative to the U.S. market.
These return entrepreneurs are uniquely positioned
to exploit the economic differences between their
home countries and the United States because of
their linguistic and cultural knowhow and connections
withdomesticinstitutionsandbusinesses.BothIndian
and Chinese entrepreneurs identify business networks
as being very important for entrepreneurial success
in their home countries, followed by family and
personal networks, and alumni networks. To both,
ties to government officials rank lower than their
other networks, although they are more important to
Chinese than to Indians.
This might be seen as a zero-sum story:
entrepreneurs are leaving the United States for the
greenerpasturesbettereconomicandprofessional
opportunitiesathome.Whatwasonceabrain
drain that advantaged the U.S. economy now is
reversed, to the long-term benefit of India and China.
The data from the final section of the survey suggest,
however,amorecomplexprocessonecharacterized
by a two-way brain circulation with potential
benefit to both the United States and these emerging
economies.
The survey confirms that, when entrepreneurs return
home, they maintain close and continuing contact with
friends and family, colleagues, customers, partners,
and sources of business information in the United
States. Indian returnees report visiting the United
States between two and three times over the previous
two years, and Chinese report visiting more than
fourtimesinthatperiod.Amajorityofthesurveys
respondents report monthly or more frequent contact
withformercolleaguesintheUnitedStates;morethan
a quarter have contact with U.S.-based colleagues
at least roughly weekly. A majority also exchange
information about customers and collaborators,
markets and technology, or organizations with people
intheUnitedStatesatleastmonthly;approximately
one-third exchange information about customers and
collaborators with colleagues in the United States
weekly or more frequently.
Returning entrepreneurs in India and China are
exploiting their privileged position in the world
economy: building businesses that take advantage
of their access to the lower costs, growing markets,
and business networks in their home countries
but maintaining close ties also with customers,
collaborators, and sources of information in the
United States. The accumulation of linkages between
What was once a brain drain that advantaged the U.S. economy now isreversed, to the long-term benefit of India and China. The data from the
final section of the survey suggest, however, a more complex processonecharacterized by a two-way brain circulation with potential benefit to both
the United States and these emerging economies.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
10/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S8
M e t h o d o l o g y
entrepreneursinregionssuchasBangaloreand
BeijingandentrepreneursintheUnitedStates
offers opportunities for mutually beneficial growth.
We have seen this positive dynamic at work in the
relationships between entrepreneurs and institutions
inTaiwanandIsraelandSiliconValley:Eachbenefits
from participation in the decentralized, cross-regional
collaborationsthatsupportinnovationintodays
global economy. Albeit that the entrepreneurs in this
survey do not rank government policy as an important
advantage, the timing of their return underscores
the importance of the recent economic and political
reforms in India and China.
This is a lesson the United States can learn from
China and India: Regions that support entrepreneurial
experimentationwillremainimportantnodesintodays
global economy. Since individual entrepreneurs lack
the incentive or the ability to preserve the wider
economic environment, when competitive conditions
change they can either move to where the grass is
greener or work with the public sector to ensure that it
encourages future generations of entrepreneurs.
MethodologyWe surveyed Indian and Chinese professionals
who had returned to India or China to start their
companies. The survey was conducted by Masters of
EngineeringManagementstudentsatthePrattSchool
ofEngineeringatDukeUniversityfromlateSeptember
2010 to March 2011. All survey respondents fulfilled
the following criteria: At the time of taking the survey,
theywereentrepreneursofIndian/Chineseoriginand
had founded or co-founded their current companies
inIndia/China.Furthermore,whenrespondingtothe
survey, they had been managing their companies inIndia/Chinaforatleastayear.Finally,priortomoving
toIndia/China,respondentshadstudiedintheUnited
States full time for at least a year as undergraduate
orgraduatestudentsand/orhadworkedinthe
United States.
The primary means used to recruit entrepreneurs
who met our search criteria were online social
media. For example, we selected, recruited, and
researched the backgrounds of respondents via
LinkedIn, an online network of more than 90 million
experienced professionals and managers worldwide
that provides a valuable source of information on these
types of workers. We contacted the returnees through
LinkedIn, by e-mailing them directly, and by phone.
We also obtained the assistance of several industry
associations in India and China to help us connect
with returnees.
Respondents were told that their identities wouldbe kept strictly anonymous. The survey was conducted
using Qualtrics, a web-based survey tool.
Of the people we were able to reach, approximately
30 percent started the survey. Two hundred and
forty-nine people started our India survey, and
153 completed it. Two hundred and one Chinese
respondents started our China survey, and 111
completed it. Most who left the survey incomplete did
so because they did not qualify.
Though our findings may not generalize to all highly
educated returnee entrepreneurs, we believe they are
representative of the professionals who returned to
India and China and started high-tech ventures there.
Background of respondentsIn our sample, the majority of respondents were
in their mid-thirties. The average age of Indian and
of Chinese respondents was thirty-seven years. The
majority of Indian (93 percent) and Chinese
(89 percent) respondents were male.
We asked how many years the respondents had
studied in the United States and how many years they
had worked in the United States before returning. On
average, Indian respondents had studied in the United
States for 1.8 years and the Chinese for 4.2 years. Onaverage, Indians had worked in the United States as
professionalsforfiveyears;Chinese,4.9years.
Fifty-six percent of Indians and 24 percent of Chinese
had family members who had moved to the United
States to live with them and subsequently had returned
withthemtotheirhomecountries.Thespouseand/or
children of 2 percent of Indian and 21 percent of
Chinese respondents had remained in the United States
aftertherespondenthadreturnedtoIndia/China.
Regions that support entrepreneurial experimentation will remainimportant nodes in todays global economy.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
11/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S
C h a r a c t e r i s t i c s o f c o m p a n i e s s t a r t e d
Percentage
Number of Years
0
10
20
30
40
50
60
Figure 1
Age Distribution of Businesses Started
1 to 2 3 to 5 5+
51
45
29
2020
35
Indian
Chinese
Kauffman Foundation
Percentage
0
10
20
30
40
50
60
70
Figure 2
Distribution of Kinds of Incorporation
Limited-Liability
Corporation
ProfessionalCorporation
GeneralPartnership
SoleProprietorship
Other Partial or FullGovernment
29
58
37
23
14
18
1414
11
1 23
Indian
Chinese
Kauffman Foundation
Characteristics ofcompanies started
Most of the entrepreneurs inour sample had businesses thathad been started less than five
years before they completed oursurvey.
Veryfewcompanies(26 percent of Indianrespondentsand10percentofChineserespondents)werefamily-owned. Most werelimited-liability companies orprofessional corporations.
Fifty-six percent ofIndian respondents and33 percent of Chinese onesoperated companies in the
ITsector;5percentand11 percent, respectively,companiesinconsulting;and 4 percent and10 percent, respectively,companies in education.
Percentage
0
10
20
30
40
50
60
Figure 3
Industry Distribution of Businesses
IT/T
echn
olog
y
Oth
ers
Cons
ultin
g
Educ
atio
n
Fina
nce
Reta
il
Phar
mac
y
Com
mun
icat
ion
Busin
essP
roce
ss
Out
sour
cing
Sem
icond
ucto
r
Aero
spac
e
Auto
mot
ive
56
33
1916
5
11
4
10
1
8
5 6 3 4 2 2 2 1 12
1 00
6
Indian
Chinese
Kauffman Foundation
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
12/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S10
C h a r a c t e r i s t i c s o f c o m p a n i e s s t a r t e d
Notsurprisingly,manyofourrespondentscompanyheadquarters were located inmetropolitan areas. Thirty-onepercent of Indian respondentshad their headquarters inBangalore;17percenteachinChennaiandGurgaon; 12percentinNewDelhi; 9percentinMumbai;and 6percentinPune.Sixtypercent
ofChineserespondentscompany headquarters werelocatedinBeijingand
17 percent in Shanghai.
Thirty-six percent of Indiancompanies had between two
and ten employees and34 percent between elevenand fifty. In the Chinese case,34 percent had between twoand ten employees and30 percent between eleven andfifty employees. Sixteen percentof Indian and of Chinesecompanies had more than100 employees.
India
China
Figure 4
Location Distribution of Businesses
Bejing 60%
Others 16%Shenzen 4%
Hong Kong 3%
Shanghai 17%
Bangalore 31%
Pune 6%
Mumbai 9%
New Delhi 12%
Chennai 17% Gurgaon 17%
Others 8%
Kauffman Foundation
Percentage
Number of Employees
0
10
15
20
25
30
35
40
Figure 5
Size Distribution of Businesses
5
1 2 to 10 11 to 50 51 to 100 101 to 200 200+
6
1
9 9
7 78
19
34
30
3634
Indian
Chinese
Kauffman Foundation
Thirty-six percent of Indiancompanies had between two and
ten employees and 34 percentbetween eleven and fifty.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
13/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S 1
C h a r a c t e r i s t i c s o f c o m p a n i e s s t a r t e d
We asked respondents tolist the initial and (if applicable)subsequent sources of capital.A majority of Indians (86 percent)and of Chinese (73 percent) listedpersonal savings as instrumentalin having initially launched theircompanies. Loans from friendsand family members in India(23 percent) and China(26 percent) were the second-most-cited factors. Two percent ofIndians and 5 percent of Chinese
had obtained venture capital
funding from firms based in theUnited States. Three percent ofIndians and 14 percent of Chinesehad obtained funding fromoutside the United States. Friendsand family members in the UnitedStates also had helped 7 percentof Indian and 8 percent of Chineserespondents with startup funds.One percent of the respondentsin India and 6 percent of those inChina had procured governmentfunds to jumpstart their firms.(These percentages exceed 100
in total for each country, becauserespondents were asked to nameall fields that applied.)
Sources of subsequent fundingincluded the personal savings of41 percent of both Indians andChinese.Venturecapitalfundingcontributed to the subsequentfunding of 16 percent ofIndians and 44 percent Chineserespondents.Nearly8percentofIndians and 4 percent of Chinesealso reported that angel investorshad contributed to subsequentroundsoffunding.Bankloansalsohad been a source of subsequentfunding for 16 percent of Indiansand 9 percent of Chinese. Only
2 percent of Indian and 9 percentof Chinese respondents hadreceived government funding afterthe first round.
Percentage
0
20
30
40
50
60
70
80
90
100
Figure 6Distribution of Initial Funding Sources
10
1
6
2
5 78
48
4
13
3
14 1314
2623
73
86Indian
Chinese
Gov
ernm
entf
unds
Vent
ure
capi
talf
irm
base
din
theU.
S.
Loan
sfro
mfrie
nds/
family
mem
bers
intheU.
S.
Bank
loan
s
Join
edexis
ting
family
bus
ines
s
Vent
ure
capi
talf
irmbas
ed
outsi
detheU.
S.
Oth
er(ple
ase
spec
ify)
Loan
sfro
mfrie
nds/
family
mem
bers
Pers
onal
savi
ngs
Kauffman Foundation
Perce
ntage
0
20
30
40
50
10
15
25
35
45
51
8
2
98
4 68
7
13
20
129
16
31
9
2222
4141Indian
Chinese
Join
edexis
ting
family
busin
ess
Gov
ernm
entf
unds
Angeli
nves
tors
Loan
sfro
mfrie
nds/fa
mily
mem
bers
intheU.
S.
Vent
ureca
pitalf
irmbas
ed
intheU.
S.
Vent
ureca
pitalf
irmbas
ed
outsi
detheU.
S.
Oth
er(ple
asesp
ecify
)
Bank
loan
s
Loan
sfro
mfrie
nds/
family
mem
bers
Person
alsa
vings
Figure 7
Distribution of Subsequent Funding Sources
Kauffman Foundation
A majority of Indians (86 percent) and ofChinese (73 percent) listed personal savingsas instrumental in having initially launchedtheir companies. Loans from friends and family
members in India (23 percent) and China (26percent) were the second-most-cited factors.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
14/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S12
W h y d i d t h e y r e t u r n ?
Why did they return?The most significant factors
drawing both Indian andChinese respondents home hadbeen economic opportunities,access to local markets, andfamily ties. More than60 percent of Indian and90 percent of Chineserespondents said that theavailability of economic
opportunities in their countrieshad been very important. TheChinese ranked local markets asvery important reasons far morecommonly than the Indians did(Indians,53percent;Chinese,78 percent). And, consistentwith our previous research
on why Indian and Chineseimmigrants return to their homecountries, more Indian(76 percent) than Chinese(51 percent) respondentsconsidered family ties as very
important in motivating theirreturn.
Percentage
0
20
30
40
50
60
70
80
Figure 8
Availability of Economic Opportunities(Distribution of Degrees of Importance)
10
ExtremelyImportant VeryImportant ModeratelyImportant NotImportant Not at AllImportant
25.7
73.2
36.4
18.625
6.94.3
0
8.6
1.2
Indian
Chinese
Kauffman Foundation
Percentage
0
10
20
30
40
50
60
Figure 9
Family Ties (Distribution of Degrees of Importance)
49.2
19.8
26.4
19.3
27.9
1.5
12.8
3.6
8.1
31.3
Indian
Chinese
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
Kauffman Foundation
Percentage
0
10
20
30
40
50
60
Figure 10
Access to Local Markets(Distribution of Degrees of Importance)
19.3
48.8
33.6
19.3
10.5 12.8 9.3
15.0
2.3
29.0
Indian
Chinese
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
Kauffman Foundation
More than 60 percent ofIndian and 90 percent ofChinese respondents saidthat the availability ofeconomic opportunitiesin their countries hadbeen very important.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
15/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S 1
W h y d i d t h e y r e t u r n ?
Percentage
0
10
15
20
25
30
35
40
Figure 11
Contributing to Home Countrys Economic Development(Distribution of Degrees of Importance)
5
ExtremelyImportant VeryImportant ModeratelyImportant NotImportant Not at AllImportant
26.7
20.9
5.73.5
8.6
14.0
25.2
30.2
33.831.4 Indian
Chinese
Kauffman Foundation
Percentage
0
10
15
20
25
30
35
40
Figure 12
Lower Business Costs (Distribution of Degrees of Importance)
5
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
20.0
14.2 14.2
7.1
12.9
20.2
32.2
34.5
20.7
23.8
Indian
Chinese
Kauffman Foundation
0
20
30
40
50
60
70
80
Figure 13
Government Incentives (Distribution of Degrees of Importance)
10
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
2.2 3.9
69.6
23.721.7
28.7
5.0
25.0
1.5
18.7
Indian
Chinese
Kauffman Foundation
The returnees took pridein contributing to theirhomecountrieseconomicdevelopment, with more than60 percent of Indians and51 percent of Chinese ratingthis as very important.
Lower business costs wereless important, as they wereranked as very important by just41 percent of Indians and38 percent of Chinese.
Incentives had been far moreimportant to Chinese than to
Indian returnees. Only 4 percentof Indians ranked them as veryimportant, but 23 percent ofChinese respondents did.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
16/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S14
A d v a n t a g e s o f d o i n g b u s i n e s s i n I n d i a a n d C h i n a
Percentage
0
20
30
40
50
60
70
80
Figure 14
Expiration of U.S. Visa (Distribution of Degrees of Importance)
10
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
3.6 3.4
73.4
61.6
11.6
18.6
5.7
10.6
5.7 5.8
Indian
Chinese
Kauffman Foundation Visashadnotbeenveryimportant to this cohort overall.They had been driven more byeconomic opportunities. Onlyabout 9 percent of the Indiansand of the Chinese rankedvisa issues as very important inmotivating return.
Advantages of doingbusiness in Indiaand China
We asked respondents to ratein importance various potentialadvantages of the choicebetween doing business in
India or China and doing it inthe United States.
The strongest advantage forentrepreneurs who had returnedto India was lower operatingcosts;inChina,itwasaccess
to local markets. Seventy-sevenpercent of Indian respondentsand 64 percent of Chineseones ranked operating costsasveryimportantadvantages;72 percent and 61 percent,respectively, ranked employee
wagesasveryimportant;and64 percent and 76 percent,respectively, ranked access tolocal markets as very important.
Percentage
0
5
10
15
20
25
30
35
40
45
50
Figure 15
Operating Costs(Distribution of Degrees of Importance of Advantage)
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
31.9
16.7
44.947.6
16.7
25.0
2.2
8.3
4.3 2.3
Indian
Chinese
Kauffman Foundation
Percentage
0
5
10
15
20
25
30
35
40
45
50
Figure 16
Employee Wages(Distribution of Degrees of Importance of Advantage)
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
26.822.9
44.9
38.5
20.0
25.0
3.6
9.6
4.3 3.6
Indian
Chinese
Kauffman Foundation
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
17/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S 1
A d v a n t a g e s o f d o i n g b u s i n e s s i n I n d i a a n d C h i n a
Percentage
0
5
10
15
20
25
30
35
40
45
Figure 17
Access to Local Markets(Distribution of Degrees of Importance of Advantage)
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
21.9
35.7
4 1. 6 4 0. 5
19.716.7
9.5
4.87.3
2.4
Indian
Chinese
Kauffman Foundation
Regarding the supply ofengineers in India and China,we noted in our research that,despiteChinashighgraduationrates compared with those ofIndia and the United States,4corporate executives had told
us consistently that there wasadequate supply in India but notin China.5 This cohort reportedsimilar results: Sixty percentin India ranked availability ofqualified workers as a veryimportant advantage, but only
43 percent in China did so.
Indians and Chinese also sawthe mood in their countries asan important advantage.Fifty-five percent of Indiansand 53 percent of Chinese,respectively, said it was very
important.
Pe
rcentage
0
5
10
15
20
25
30
35
40
45
Figure 18
Availability of Qualified Workers(Distribution of Degrees of Importance of Advantage)
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
24.0
3.6
35.5
39.3
28.2
39.3
7.3
12.0
5.06.0
Indian
Chinese
Kauffman Foundation
4. Gerei, Gary; Wadhwa, Vivek; Rissing, Ben;and Ong, Ryan, Getting the Numbers Right:International Engineering Education in the UnitedStates, China, and India,Journal of EngineeringEducation 2008; 97(1):1325. Available at SSRN:http://ssrn.com/abstract=1081923.
5. Wadhwa, Vivek; Rissing, Ben; and Gerei,Gary, Industry Trends in Engineering Offshoring.October 24, 2006. Available at SSRN: http://ssrn.com/abstract=1015839.
Percentage
0
10
15
20
25
30
35
40
Figure 19
Mood in the Country(Distribution of Degrees of Importance of Advantage)
5
19.7
15.4
9.5
3.5
9.5
13.0
25.6
29.8
35.738.0
IndianChinese
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
Kauffman Foundation
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
18/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S16
P e r s o n a l c o m p a r i s o n s : t h e U n i t e d S t a t e s v s . I n d i a / C h i n a
Percentage
0
5
10
15
20
25
30
35
40
45
Figure 20Infrastructure (Power, Water, Broadband)(Distribution of Degrees of Importance of Advantage)
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
10.9
4.8
19.7
30.133.7
39.6
18.2
13.2
17.5
12.0
Indian
Chinese
Kauffman Foundation
Percentage
0
5
10
15
20
25
30
35
40
45
Figure 21
Government Support(Distribution of Degrees of Importance of Advantage)
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
2.2
8.4
4.5
22.6
27.0
37.0
24.0
16.7
42.3
15.5
Indian
Chinese
Kauffman Foundation
Percentage
0
10
20
30
40
50
60
Figure 22
Opportunities to Start a Business (Distribution of Comparisons)
54.2648.15
17.83
13.95 13.58
4.651.23
9.30
3.70
33.33
Indian
Chinese
Much better inmy homecountry
Somewhatbetter in my
home country
Somewhatbetter inthe U.S.
Much betterin the U.S.
About thesame in my
home countryand the U.S.
Kauffman Foundation
Only a minority of Indians(31 percent) and Chinese(35 percent) ranked their
countrysinfrastructureasavery important advantage.
Chinese said far morecommonly than Indians (Indians,7percent;Chinese,31percent)that government support is veryimportant.
Personal comparisons:the United Statesvs. India/China
We asked a seriesof questions about therespondentscomparisonsoftheir current situations withtheir previous situations in theUnited States.
Surprisingly, 72 percentof Indians and 81 percent ofChinese said the opportunitiesto start their own businesseswere better in their homecountries. Only 5 percent ofChinese and 14 percent ofIndian respondents said theopportunities were better inthe United States.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
19/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S 1
P e r s o n a l c o m p a r i s o n s : t h e U n i t e d S t a t e s v s . I n d i a / C h i n a
Percentage
0
5
10
15
20
25
30
35
40
45
Figure 23
Speed of Professional Growth (Distribution of Comparisons)
31.78
39.51
22.48
28.40
20.93
14.81
9 .3 0 8 .6 4
13.18
6.17
Indian
Chinese
Much better inmy homecountry
Somewhatbetter in my
home country
Somewhatbetter inthe U.S.
Much betterin the U.S.
About thesame in my
home countryand the U.S.
Kauffman Foundation
Percentage
0
10
15
20
25
30
35
40
Figure 24
Quality of Life (Distribution of Comparisons)
5
20.16
8.64
31.01
27.16
12.4013.58
16.28
33.33
19.3817.28
Indian
Chinese
Much better inmy homecountry
Somewhatbetter in my
home country
About thesame in my
home countryand the U.S.
Somewhatbetter inthe U.S.
Much betterin the U.S.
Kauffman Foundation
Percentage
0
10
15
20
25
30
35
40
Figure 25
Professional Recognition (Distribution of Comparisons)
5
25.58
33.33
17.83
7.41
16.28
7.41
17.0514.81
20.93
34.57
Indian
Chinese
Much better inmy homecountry
Somewhatbetter in my
home country
Somewhatbetter inthe U.S.
Much betterin the U.S.
About thesame in my
home countryand the U.S.
Kauffman Foundation
Speed of professionalgrowth also was better backhome for the majority of Indians(54 percent) and of Chinese(68 percent).
Fifty-six percent of Indiansand 59 percent of Chineseenjoyed a quality of life backhome that was better than oratleastequaltowhattheydenjoyedintheUnitedStates;43 percent and 41 percent,
respectively, found it better inthe United States.
Theydidnthavetosacrificeprofessional recognition,either. Sixty-four percent ofIndians and 83 percent ofChinese said professionalrecognition was about thesame or better in their homecountries as in the UnitedStates;34percentofIndiansand 15 percent of Chinese saidprofessional recognition was
better in the United States.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
20/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S18
T h e A m e r i c a n a d v a n t a g e
Percentage
0
10
15
20
25
30
35
40
Figure 26Salary Received (Distribution of Comparisons)
5
13.9514.81
37.98
18.52
25.58 24.69
13.95
19.75
6.20
17.28
Indian
Chinese
Much better in
my homecountry
Somewhat
better in myhome country
Somewhat
better inthe U.S.
Much better
in the U.S.
About the
same in myhome countryand the U.S.
Kauffman Foundation
Percentage
0
10
20
30
40
50
60
Figure 27
Business Networks (Distribution of Degrees of Importance)
42.3 40.2 38.6
16.1
4.8
1.52.4
1.5 1.2
51.2
Indian
Chinese
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
Kauffman Foundation
Percentage
0
10
15
20
25
30
35
40
Figure 28
Personal/Family Networks(Distribution of Degrees of Importance)
5
30.5
37.8
8.4
4.8
11.47.3
20.7
14.6
29.0
35.7
Indian
Chinese
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
Kauffman Foundation
The American advantageThe only advantage
respondents indicated that theUnited States offered lay in thesalariesreceived64percentof Indian respondents said thesalaries had been better in theUnited States than they wereat home. Forty-three percent ofChinese respondents stated thatsalaries had been better in theUnited States, while 20 percentstated that they were about thesame in China and the UnitedStates.
Importance ofnetworks in homecountry
To gauge the relativeimportance of networks andgovernment contacts, weasked the respondents to ranktheir importance relative to
each other.
Businessnetworkswereconsidered very important by81 percent of Indian and
91 percent of Chineserespondents.
Personal/familynetworkswere regarded as very
important more commonlyby Chinese than by Indianrespondents (Indians,60percent;Chinese, 74 percent).
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
21/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S 1
T i e s t o t h e U n i t e d S t a t e s
Percentage
0
10
15
20
25
30
35
Figure 29
Alumni Networks (Distribution of Degrees of Importance)
5
23.6
12.210.7
6.0
11.6
17.0
26.7
31.733.0
27.4Indian
Chinese
Extremely
Important
Very
Important
Moderately
Important
Not
Important
Not at All
Important
Kauffman Foundation
Percentage
0
10
15
20
25
30
35
Figure 30
Ties to Government Officials(Distribution of Degrees of Importance)
5
14.6
22.0
27.7
9.7
21.518.3
23.224.425.6
13.0
Indian
Chinese
ExtremelyImportant
VeryImportant
ModeratelyImportant
NotImportant
Not at AllImportant
Kauffman Foundation
Alumni networks also werevalued. Fifty-one percent ofIndians and 45 percent ofChinese considered them to bevery important.
Indian respondents lesscommonly (28 percent)regarded ties to governmentofficials as very important thanChinese ones did (48 percent).
Ties to the United StatesClose economic ties between Indian and Chinese
entrepreneursinCaliforniasSiliconValleyandtheir
respective home countries have enabled the transfer
of organizational and technical expertise between
theseregions(Saxenian2002;2006). 6, 7Saxenians
study of U.S.-based Chinese and Indian immigrants,for example, found that they have a wide range
of professional ties to their native countries. Many
returned to their native countries regularly for business
purposes and to exchange technology and labor-market
information with colleagues and friends. Some also
advised companies, invested in startups and venture
funds, and met with government officials in their native
countries.
To better understand the transnational behavior of
our respondents, we asked them to tell us how often,
in a typical year since returning to their home countries,
they maintained contact with their former colleagues,
family/friends,educationalorganizations,professional
organizations, and ethnic organizations in the United
States. And we asked how often they exchange
informationwithpeople/organizationsintheUnited
States about job opportunities and business funding
opportunities, technical information, and information
6. Saxenian, AnnaLee, Local and Global Networks of Immigrant Professionals in Silicon Valley. San Francisco: Public Policy Institute o Caliornia, 2002.
7. Saxenian, AnnaLee, The New Argonauts: Regional Advantage in a Global Economy. Cambridge, Mass.: Harvard University Press, 2002.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
22/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S20
T i e s t o t h e U n i t e d S t a t e s
onmarketsandcustomers/collaborators. The results arepresented below.
Over the previous two years,Indian returnees had travelled to
the United States or abroad forwork purposes on average 2.5times;Chinesereturnees,4.3times.
We found that both Indiansand Chinese maintained strongcontacts with former colleagues,family, and friends.
Eighty-four percent of Indiansmaintained at least monthlycontact with family and friends,and 66 percent maintainedcontact of this frequency withtheir former colleagues. Onlyseven percent maintained monthlyor more frequent contact withethnicorganizations;17percent,witheducationalinstitutions;and37 percent, with professionalorganizations. The vast majority,75 percent, maintained no contactat all with United States ethnic
organizations.
Eighty-one percent of Chinesemaintained at least monthlycontact with family and friends,and 55 percent maintainedcontact of this frequency withtheirformercolleagues.Nineteenpercent maintained monthlyor more frequent contact withethnicorganizations;34percent,witheducationalinstitutions;and45 percent, with professionalorganizations.
Chinese connections to ethnicorganizations were far strongerthan Indian ones. Half madecontact every six months or morefrequently with these groups(compared with 25 percent ofIndians).
Percentage
0
20
30
40
50
60
70
80
90
Figure 31Indian Returnees Contacts with Colleagues,Friends, Family, and Organizations in the United States(Distribution of Contact Frequency by Contact Type)
10
Formercolleagues
Family/friends
Educationalorganizations
Professionalorganizations
Ethnicorganizations
Seve ral times a week About once a week
About every six months Never
About once a month
Kauffman Foundation
11
18
37
29
5
18
30
36
12
41
4
12
36
47
512
20
3034
205
19
75
Percen
tage
0
20
30
40
50
60
Figure 32
Chinese Returnees Contacts with Colleagues,Friends, Family, and Organizations in the United States(Distribution of Contact Frequency by Contact Type)
10
Formercolleagues
Family/friends
Educationalorganizations
Professionalorganizations
Ethnicorganizations
Seve ral times a week About once a week
About every six months Never
About once a month
1511
29
35
10
21
27
33
17
25
9
20
43
24
5
13
27
41
13
6
0
13
30
50
Kauffman Foundation
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
23/24
T H E G R A S S IS IN D E E D G R E E N E R IN IN D IA A N D C H IN A F O R R E T U R N E E E N T R E P R E N E U R S 2
T i e s t o t h e U n i t e d S t a t e s
The percentage of Indianrespondents who discussedat least monthly with theircontacts in the United Statesthe following topics was:markets,62percent; customers,61percent; technical information,58percent;jobopportunities,35percent;andbusiness
funding, 31 percent.
Percentage
0
10
15
20
25
30
35
40
Figure 33
Indian Returnees Exchange of Professional Informationwith People/Organizations in the United States
(Distribution of Contact Frequency by Contact Type)
5
Jobopportunities
Businessfunding
opportunities
Technicalinformation
Informationon markets
Informationon customers/collaborators
Seve ral times a wee k About once a week
About every six months Never
About once a month
5
8
22
32 32
2
10
19
3534
9
17
32
26
16
8
19
34
28
10 11
18
32
22
16
Kauffman Foundation
Percentage
0
10
15
20
25
30
35
45
40
Figure 34
Chinese Returnees Exchange of Professional Informationwith People/Organizations in the United States
(Distribution of Contact Frequency by Contact Type)
5
Jobopportunities
Businessfunding
opportunities
Technicalinformation
Informationon markets
Informationon customers/collaborators
Seve ral times a wee k About once a week
About every six months Never
About once a month
Kauffman Foundation
7
10
38
22 23
912
3330
16
10
24
34
20
12 12
24
35
17
11 10
26
38
1215
The percentage of Chineserespondents who discussedat least monthly with theircontacts in the United Statesthe following topics was:
customers,74percent;markets,71percent;technicalinformation,68percent;jobopportunities,55percent;andbusiness funding, 54 percent.
8/7/2019 The Grass Is Indeed Greener in India and China for Returnee Entrepreneurs
24/24
4801 ROCKHILL ROADKANSAS CITY, MISSOURI 64110