This country needs more foreign entrepreneurs, says Olga Kozlova
SCOTLAND has been an attractive destination for overseas students wanting to study at our universities, but with the tightening of immigration rules, is there a risk that we will lose out in the race to attract the brightest and best in what is a highly competitive global market?
A report by Universities Scotland, published last September, highlighted the value of overseas students studying in Scotland.
It stated that the economic benefit of attracting international students to Scotland is evidenced by the fact that they provide an estimated £337 million every year in fees and an estimated £441m in off-campus expenditure – renting accommodation, buying the necessities of everyday life etc. In other words, making their home in Scotland for the period of their studies.
It goes on to point out that these overseas students also have a profound social, cultural and educational impact on Scotland, something to be applauded. To this list of beneficial influences I would like to add the positive impact being made in business creation. We are seeing a steady number of companies being started by students and staff who have come from aboard to study and work in Scotland and who are seizing the opportunity offered by initiatives such as Converge Challenge, a business competition open to staff and students of all Scottish universities and research Institutes.
Over the four years in which the Converge Challenge has been in existence, we have had 180 applications and, following the process of pitching their businesses to a highly qualified panel of judges, 120 entrepreneurs have successfully been trained.
The most recent cohort of 30 from 2013 has already formed four companies – it can take a bit of time to develop even a nascent business – but, impressively, from the first three years, 90 projects have been initiated leading to 24 companies being formed.
These businesses have secured funding of £2,562,983, are employing 47 people and have launched 24 products. Of these businesses, ten involve founders or co-founders from overseas, including France, India, Malaysia, Russia, Ireland, South Africa and Italy.
Representative of the innovative individuals being supported by Converge Challenge is 2013 winner Madhu Nair, co-founder, together with his business partners Philip Benson and David St Clair, of SACCADE Diagnostics, from Aberdeen University. It is now commercialising a novel eye-movement test as a point-of-care tool for the rapid diagnosis and clinical management of major psychiatric disorders.
Worrying, however, is the latest set of figures for overseas students coming to study in Scotland which shows a decline in numbers.
Official figures from the Higher Education Statistics Agency (Hesa) show there was a 4 per cent decline in overseas postgraduate students and a 4 per cent drop in the number of first year undergraduate foreign students. This decline has followed the introduction of tougher visa restrictions by the Home Office. Of particular concern is the fact that they are now facing more limited rights to work after they complete their studies.
We often look at the US as the ultimate in an enterprise economy and it offers many examples of how immigrants can successfully shape a country’s development.
Those of us in Scotland should be especially aware of the contribution of a certain Andrew Carnegie, and the recent joint study by the National Venture Capital Association and Stuart Anderson, of the National Foundation for American Policy, underlines the continued importance of immigrants to the US. The report highlights how initial public offerings (IPOs) show a sharp increase in the economic influence of immigrant founders. Twenty per cent of venture-funded companies with an IPO prior to January 1, 2006 had an immigrant founder. However, between 2006 and 2012 immigrants started 33 per cent of US venture-backed companies that became publicly traded, a total of 92 companies. Prior to 1980, only 7 per cent of US publicly traded venture-funded companies had an immigrant founder or co-founder.
Recent success stories with at least one immigrant founder included Facebook and LinkedIn.
Now that Scotland is looking at its constitutional future, it is important that we attract the best and the brightest no matter if we are within the UK or independent. And one way of doing it is to create opportunities for them – our universities can help and also give them an opportunity to start a business.
• Olga Kozlova is director of Converge Challenge, www.convergechallenge.com