entrepreneurs. from immigrant to emigrant. silicon valley's foreign-born entrepreneurs are leaving the country. ravek vadwad tries to plug america's brain drain. plus, the secret formula for entrepreneurs. with reporters eric savitz of "forbes" and "usa today's" john soares. this week on "press: here." good morning, everyone. i'm scott mcgrew. a neat little american success story for you. a young couple graduates from the university of wisconsin. they create an app for facebook, get millions of users, and start a company. just one problem. the problem is they were here on a student visa. anand and shika shapar were

unable to get permanent residency in the united states. so the couple and their business went back to india, where the company operates today. >> we found 52% of the start-ups in silicon valley were founded by people like me. >> vavek vadwad has sounded the alarm on this brain drain. foreign-born entrepreneurs leaving he says subtracting jobs and tax revenue from our economy. the value of foreign-born entrepreneurs is well known in silicon valley. sun microsystems was started by an indian immigrant, intel by a hungarian, ebay a frenchman, google a russian. tesla motors and spacex by a south african. the u.s. government itself has named vavek vadwad as one of the most outstanding americans. the actual title, outstanding american by choice. he was born in india.

his res jooum long. harvard fellow, entrepreneur, but most remains at discussion is his book, "the immigrant exod exodus: why america is losing the global race to capture entrepreneurial talent." joined by john swartz of "usa today" and eric savitz of "forbes." when your book came out, you had a study that came out at the same time that said the largest drop in the percentage of immigrant entrepreneurs in silicon valley in a good long time. and you raised the alarm about that. why? >> because we had an influx of skilled immigrants in the '90s and early 2000s. on average people like me start companies 12, 13 years after arriving in the united states. we should have seen an explosion in immigrant entrepreneurship, yet it dropped. it went from 52% in silicon valley being immigrant founded down to 44%. >> percentagewise, that means the other percentages were founded by americans. it's not a numeric thing. why do i need immigrants to be founding my companies?

>> it's not that more americans are starting companies. the number of start-ups is stagnant. the pie has gotten smaller. >> so what happened? has there been policy change in terms of the ability of people to get into the country? >> eric, we brought hundreds of thousands of people in to study, to work, and then they became comfortable in america and started working for american companies, starting patents, and then we said we don't have enough visas for you, go home. so my students at duke university, they graduate from one of the finest engineering programs in the world and then they want to work here and stay here and there are no visas for them so we tell them to go leave the country after we've educated them. >> there's the bedevilling problem of education, without enough college graduates in math and science which has been going on for years and there seems to be no solution when you talk to heads of engineering at the colleges because they don't have enough people going into college interested in those majors. >> and we're taking all the founders out, training them, educating them, and saying please go back home. >> that's the bizarre thing. american colleges are welcoming

foreigners. university of san francisco, particularly here locally, welcoming foreigners. once we've taught them all that we know we say go home. but here's the thing i don't understand is who's standing in the way of making policy change here? i think on both sides of the aisle i don't think there's the -- the political aisle. i don't think anyone would say this is a good policy. let's continue to educate engineers. >> one might agree they have everything in common. >> not my children. >> this is what our politicians are doing. they're fighting each other. the democrats and republicans both agree we want these skilled foreigners, we want people who are going to create jobs for americans who are going to make us more competitive. everyone agrees with that. but they won't give each other political victory. so bills passed, for example, the stem bill recently which had support on both sides.

the democrats defeated it because it had one provision that the republicans put in there that they didn't like. so they killed the stem bill. >> do you think it will get better after the presidential election? >> i sure hope so. i mean, i think we'll have a year or two of peace. my hope is we'll have a year or two of peace and we'll do sensible things for a change. the last four years have been incredibly stupid. >> you have a situation where these people learn, somebody comes to this country, gets an education, and starts working, green card issues, xha have you, they go back to india or china where they can establish kind of like a copycat company in some instances, create their own huge economies within those countries. is that -- >> you go there and see entrepreneurship booming in india and china and brazil. in chile which is giving money to anyone in the world who wants to start a company there, you see entrepreneurship booming. in silicon valley it's not that we're not doing well, but it's stagnant. it's not growing the way it should be growing. >> how much of this is that the earth is just getting flatter, though?

there's a brazilian company called levin and if you ever get a chance to meet bell pesci, she's one of the engineers there, an up-and-comer out of brazil. is doing incredible things for companies. and when i download the app the fact it's from brazil, i don't even know that, nor do i care. maybe this is a victory for america, that we have exported this idea. >> we've exported our wealth. we've exported our prosperity. is that a victory? >> no. but i'd rather have a brazil or a china or an india that -- >> if we were doing it deliberately out of the goodness of our hearts, but we're not doing it deliberately. we're doing it out of stupidity. >> but there's an underlying question here, which is if i'm that entrepreneur, if i'm going to start a company, if i have the option, i can start it here in the valley or i can start that company in india or in china or brazil for that matter, there are still reasons i might want to do that here, right? if the playing field was in fact level, an equally good

opportunity. but that's not the situation. >> there's nothing like silicon valley. if you're an entrepreneur anywhere in the world this is where you want to be because you have access to a network, you have access to great people, you have access to funding. everyone wants to be here. this is a great advantage that america has, that the world's best and brightest, the most innovative people want to be here. except we're so dumb we won't let them come. >> when you think of immigrants starting companies, you think of google, yahoo, tesla. maybe there's an opportunity that something like that slips -- >> and in the next five or seven years you will have google kilometers coming out of china, india and brazil and we'll be sitting back and saying what was wrong with us? >> especially because their founder will have come from stank stanford. which will be -- you said with an h-1b visa that you can work for a company but you can't work for your own company. >> that's right. >> you can create a google and you can work at google but if you're a creator of google you can't work there. >> that's the stupidity of

american policies. >> and it goes back to john questions. or maybe it was eric. if it's that dumb surely this can get solved. is it 250id to immigration? immigration's such an angry, sore subject in washington. >> you hit the nail on the head, my friend. that's what the problem is. because the democrats want to solve the entire problem, comprehensive immigration reform, which means we provide some form of amnesty to the undocumented workers. the republicans will have no part of it. so if we solve the problem of skilled immigrants, then the urgency for solving the problems of unskilled, undocumented workers will be less. this is why the democrats aren't agreeing to what the republicans want. the republicans will happily solve the problems of the skilled but the democrats aren't letting it happen. which is what the irony over here. democrats all or nothing. republicans, give us the world's best and brightest and keep everyone else out. >> there is the piece that feels like america -- i can see their point in that america is

supposed to be open and we're going to take a certain number from this country and a certain number from this country without caring the level of education or what country, the irish, the greeks, whatever. but economically that may not make sense. we may need to choose one over -- >> we want people over here. >> you can feel how uncomfortable this makes me, this idea we're going to choose this person, not that person. >> is this outstanding way affecting immigrants, say, from india more than other countries or from china? >> here's another irony. there's a 7% per country limit on the number of green cards from the resident visas. which means people from india get the same quota as people from ireland. china's the same as mongolia. >> in china and india don't they have a million people a year -- >> although that number, that engineer number's a little fuzzy because they can -- >> a lot of scientists that they

have. you want the top .001% to come over here. >> which is still a huge number. >> which is still a huge number. but right now indians and chinese are the majority of the skilled immigrants that are coming here. their numbers are capped because of the 7% per country limit. it doesn't make sense. >> go ahead, john. >> obama, when he would speak at facebook or linkedin events this is one of the issues he would talk about but he would kind of dance around the topic because of the sensitivity of it. that's the frustration. >> i'm not happy with our president because he's been coming to silicon valley promising to take care of silicon valley and then he goes back home and says we need comprehensive immigration reform. in other words, give me all or nothing. unless we solve the problems of the unskilled you're not going to get the skilled problem solved. i'm not happy with any of our politicians right now. >> vivek wadhwa, thank you for being with us. my next guest doesn't want to start a business. he wants to start 1,000 of them.

welcome back to "press: here." we've been talking about entrepreneurship this morning. my next guest got his start early in entrepreneurship, selling t-shirts as part of junior achievement in high school. adeo ressi then created one of the first internet companies ever, sold that a few years out of high school to aol for millions of dollars now. holds workshops in 32 cities all over the world showing people how to succeed in business while really trying. his plan is to launch 1,000 new businesses every year. he is also, by the way, on the board of the x prize. joined by john swartz of "usa today" and eric savitz of "forbes." it's going to come up at some point. so let's just mention it right off the top rpgs, and that is who was your college roommate? >> my college roommate was elon musk, the founder of tesla,

spacex, and technically solar city. >> and you guys started kind of a nightclub together as well. >> that might have been my second or third business, was an underground nightclub. >> a speakeasy. >> yeah. a speakeasy. in philadelphia. >> should we be speaking of this? i'm sure stanford will forgive you. >> you're making me incredibly comfortable right off the bat. >> go ahead and stick him with questions. >> why did mark cuban run the bar in the university? >> we were kind of geeky college students and we wanted to seek some entertainment and we figured, hey, the best way to do it is to do it ourselves. >> liz gaines once wrote you that had said, "i can take a person off the street and make him an entrepreneur." and you do in the sense that thousands of people have gone through foundry institute to learn how to do this. >> and create companies everywhere in the world. so i know you had a guest on

before, vivek, talking about i think it's important to bring the best and brightest to silicon valley but in some ways you're sucking out the oxygen of these local ecosystems. i like to see the best and the brightest stay in their city and build great companies there as well as the best and the brightest here build great companies here. there's no reason there needs to be one destination for great entrepreneurs. >> but isn't there an argument that says there are enough smart people on the plan eliot who should have the option if they want to start their business wherever they want to start their business. here, they want to do it here. for a lot of people they'd rather start in bangalore or beijing or wherever. >> it's okay. there are great people everywhere in the world. in fact, we've tested about 8,900 people and we can measure attributes of entrepreneurship. my guess is about 2% of the human population have the raw material to build great companies. now, if you take the top people in the market and you pull them

out and bring them to silicon valley, you're leaving that market with a lack of mentorship, with a lack of capital. because they tend to be the most successful. so they have the money to reinvest. and you know what to do because they built a successful company. but then they immigrate here and so brussels or berlin or indonesia suddenly lacks the top -- >> you don't want to engineer their decision on where they want to build their business. >> i agree with that as well. i agree that we shouldn't force them to stay in indonesia. but that's not what i'm saying. i think that we also want to see great ecosystems emerge in the different markets around the world because more people will come online in indonesia than in any other place overt next three years. so they're getting smartphones with internet access. why shouldn't there be a thriving ecosystem in indonesia?

>> and you're teaching them with classes in indonesia. john swartz. >> so what do you look for in an entrepreneur? i think scott mentioned earlier sometimes they're tall. >> you say you actually have a formula. >> so we test for entrepreneurship and we can look at attributes. so the tall thing comes up. i'm a tall guy, but that doesn't mean that i'm a basketball player. but it means i could most likely be a basketball player. so some of the traits that we look for in an entrepreneur is how quickly can you respond to the world around you. and that's a measurement called fluid intelligence. another one is how open are you? so good entrepreneurs are open to new ideas, open to the world around them. maybe there's a problem in the business and because they're very open-minded they can see it early. so we have about a half dozen different traits like that. >> and you give these tests to every candidate. >> yep. >> if i want to become part of the founder institute, do i have to pass this test to get that

far? >> well, pass is a strong word to use. yes. we give people a grade, if you will, on 1 to 5 and then we look at the component attributes as well. so i wouldn't say there's a pass or fail. >> what are some of the questions? can you mention one or two? just curious. >> yes. so you've got pattern-matching questions like this is to this, like this is to that. so standard sort of iq test things. and then there's personality questions. so if you were in a bad mood, how would you describe it? and it's multiple choice and kind of fruity. >> i have sort of a fundamental question about the people who come to want to take your classes, which is are these people who sort of wake up one morning and go i know what i want to do, i want to be an entrepreneur. or are these people who go i have a brilliant idea to solve this problem, i want to build something around this? >> the average age is 34 1/2 years old. we're graduating now 36%-led

female businesses, or female-led businesses. and they tend to be working professionals with a job. and it's more like i've been working at my job for a long time, i want to see something problematic in the world, something i can fix with my skills, so i'm going to set out to do it. wait a minute, this is a complicated and scary new world. i'm not exactly sure what's right and what's wrong. so is there something, some program or something that can help me. and that's part of the reason why we do this all around the world, is because that happens all around the world. and those people aren't the people that are going to get on a plane and fly to silicon valley. they're going to figure it out in jakarta or berlin or hanoi and build their business there first. >> i hope this doesn't come up the wrong way. >> i've read reports ceos are so

crazy, do you have to have an element of being a little insane? >> there's crazy and then there's too crazy. so we actually measure craziness, and it turns out since we have such a large volume we've done about 651 businesses so far and we're on pace to do 1,000 a year. and there's a certain level of craziness which acts as a glass ceiling to your success. so if all of the sudden the world gets hairy and you blow a fuse, right? quote unquote. it's a self-destructive move. so we've found there are thresholds of craziness whereby you're blowing a fuse too often, our creating too many problems for yourself and your team too often. so we call it almost like a glass ceiling for success that you might rocket up and build a good company but then your own problems prevent you from getting to the next level. a little crazy is good. >> adeo ressi, i promise you

when we put this on the internet we're going to title it "the threshold of crazy nose." that's the best title to get people to watch it at least on the internet. thank you for being with us this morning. >> thank you. >> "press: here" will be back in just a moment.

. welcome back to "press: here." this week represented by "usa today" and "forbes." both of you fellas have or will have a cover story, john. if folks are watching this sunday morning. which is when it usually runs -- monday morning. next day, monday morning in "usa today" about what? >> we're going to do women in v.c. >> venture capital. >> venture capital and investing. i've been trying to do a story about women in tech because there aren't enough no matter how you look at it. ceos, engineers. the percentages are woefully low. so we had a round table that we

set up at facebook and they insisted on having it there. cheryl sandberg stopped by to lend her surntd and she's coming out with a book in a couple of months. it's something that i think -- it's so frustrating because women have so much purchasing power and always have, especially online now. and a lot of the start-ups are commerce-related and maybe even female-oriented, yet funding isn't quite there. >> is it -- >> for those who don't follow every bit of facebook, cheryl sandberg the number 2 at -- >> sure. >> what's the issue? where's the problem? is it that venture firms aren't -- >> so i'll give you an example. i talked to one prominent vc. will silverin. all of your problems are men. why do you not have any women who are partners at your firm? and he gave the binder full of

women answer. we interview candidates. we always look for good women. but we just try and hire the best candidate and we haven't -- >> they don't know enough of them, right? >> so i asked william draper about that. historic figure. he said you're right, it's a boys' network. usually you hire people you remember from college. sought binders answer kind of applies to this. >> i'd like to think it was a meritocracy, that the reason might be because women are late into the workforce by vc standards. i mean, we're talking about the high-end executive where they haven't maybe worked out -- >> the progress is glacial, but -- >> you have women engineers and then women ceos in the case of yahoo because -- >> it has deep roots, right? a lot of these people who worked in industry or ceos, a lot of people are engineers, there are not as many -- not enough women engineers. not enough women -- girls taking hard math and science courses in

high school. there's a whole ecosystem problem here that has -- >> that's exactly the same end of the story. one thing, heidi worzen who's been around for a while, she maud the same point, it will take 10 or 20 years but it should -- >> and this is something you continue to cover. >> i want to write about women engineers and how all of that is taking off a little bit. >> and eric, you did a cover story on jack dorsey, who's been a guest on this show. so early that we essentially had to explain to the viewer what twitter was. and it's really hard to explain to somebody what twitter is. this is, what, three years ago, four years ago. because you have to do it -- anyway. he is now probably better known for square than anything else. >> we're talking about entrepreneurship on this show. and here's one of the great serial entrepreneurs of our time. started twitter, started square. he's actually now spending most of hz time at square where he's the ceo. he has a mission to kind of

reshape the world of money. he thinks money, the old-fashioned way of thinking about money can be improved, that there are better ways you can do. >> i suppose i've broken my own rule. i always jump in and say explain, that square, the little thing you put on top of an iphone or ipad. everyone's seen them by now i'm sure. >> anybody can -- >> a garage saul can take a credit card. >> that was the first part of the business. now they've added a couple other pieces including software that basically allows anyone to run their retail business on your ipad. at the cash register. you run the card. but now you've not only -- you not only dot transaction but you've got all sorts of information about that person, about what they bought, what they bought last time they were in the store about managing inventory. all kinds of things you can do with this fairly simple app. >> i expect to see a lot more square too because they're going to start rolling it out at starbucks and i think that opens the door because starbucks is considered an innovation leader. >> i interviewed him at this

event, the starbucks event, and he said that other major retailers are getting in line. >> starbucks is such agreat foot in the door. not only do they have a location everywhere but everybody's familiar with it. and the comfort level of starbucks. oh, you guys are doing the thing that i saw at starbucks is going to have people comfortable with that. and you're saying born entrepreneur. >> totally born entrepreneur. i think there's this issue, right? you build entrepreneurs or are they born. i think in jack's case there's no question it was about the idea. if you ask him about building businesses he doesn't -- he's not somebody who grew up saying i want to build businesses. he wanted to pursue these ideas that he had, first in the case of twitter, then in the case of square. he had some other ideas. he wanted to be mayor of new york. >> adeo ressi would say he's just the right amount of crazy. we have to pitch to commercial. we'll be back in just a moment.

that's our show for this week. my thanks to our guests, vivek wadhwa and adeo ressi. more information about joining adough's founder institute at -- i'm scott mcgrew. thank you for making us part of your sunday morning.