Business — 02 November 2012
By
Capital News Service

COLLEGE PARK – Johan Sebastian Garcia considered launching his technology company in California or New York, to tap into the vibrant tech culture and startup capital in those states.

But the 29-year-old graduate student from Bogota, Colombia, ultimately decided to start his digital marketing company in Baltimore because the state offered resources to build his business that were “too good to pass” up.

Garcia’s fledgling company, Eldorado Tech, is developing software for restaurants to reward their clients with cash and free food.

“I had a lot of support,” Garcia said. “There is a big project to push entrepreneurship here in Baltimore.”

Garcia is one of hundreds immigrant entrepreneurs starting technology businesses in Maryland. Immigrant entrepreneurs founded about a quarter of the engineering and technology startups in Maryland between 2006 and 2012, according to a recent Kauffman Foundation report.


Yan A. Su, a Chinese immigrant, talks about the biotech company he started in Rockville.

Maryland–considered a national leader in science, technology, engineering, and mathematics (STEM) related industries—tends to attract high-skilled immigrants. Maryland was one of seven states where immigrants founded more than 24 percent of the technology businesses, the report found.

“When you have a dynamic growing economy, you tend to pull in immigrants,” said Jeff Werling, an economic development professor at the University of Maryland, who has studied the impact of immigrant entrepreneurs.

Maryland is a natural fit for immigrants with innovative ideas, Werling said, because of the state’s strong technology and science industries, the state government’s commitment to work with minority-owned businesses and the existence of programs to help people start businesses.

Government agencies and private groups in Maryland have launched several efforts to encourage new businesses in the state, including several incubator programs that provide technical support to new companies.

For Garcia, the mentoring and the affordable workspace at the University of Maryland Baltimore incubator were invaluable in starting his digital marketing company. Through the incubator and UMB’s entrepreneurship center, he was able to network, find funding, create his product, learn about business regulations and hire interns.

“Now we are using three restaurants in Baltimore and D.C. as test labs,” Garcia said. “We are hoping to launch in the summer.”

Highly-skilled immigrants also gravitate toward Maryland because of the state’s strong universities and its proximity to the nation’s capital. Many immigrants who focus on sciences start their own business and become contractors for the government.

“These are highly educated people who came to work and study and were attracted by the federal labs and world-class institutions of higher learning,” said Clay Hickson, the president of the Maryland Business Incubation Association, which supports about 345 clients.

Yan A. Su, who immigrated from China 26 years ago, started a company in Rockville after years of teaching at local universities. His 5-year-old company, GenProMarkers, provides biotechnology services to the Defense Department, the National Institutes of Health and other research centers.

“We are trying to fill a hole instead of competing with other people,” Su said. He uses biomarkers to measure the progression of diseases, which helps to determine which treatment is most effective.

The Kauffman report found that Maryland had the second highest rate of Chinese-led engineering and technology businesses in the country. Over the last six years, 16 percent of all Chinese-founded technology startups in the United States were created in Maryland.

The trends mirror state demographics.  Kauffman researchers found that 80 percent of immigrant-led startups in Maryland were founded by Chinese and Indian immigrants.

In tech-industry heavy Montgomery County, Asians represent more than 14 percent of the population. Census data shows most Asians in the county are from India, China and Korea.

Silver Spring resident Joan Wang, who came from China to get her doctorate at Johns Hopkins University almost 20 years ago, stayed in the area because of its diversity.

“Maryland is my second hometown,” Wang, 42, said. “I have been working here for many years; I don’t think I would have started my business anywhere else.”

Last year, Wang left her job of 12 years to launch iDesign Engineering Inc.  Her company works with private developers in Delaware, Maryland and Virginia. She also has contracts with the Maryland State Highway Administration and the Architect of the Capitol, a federal agency that develops and preserves government facilities in the Washington, D.C.

She said she was planning to attend a state-sponsored workshop for certified minority businesses to learn how to expand her company.

“Maryland is a good state for minorities to launch their own businesses,” Wang said.

Economists said that foreign-born entrepreneurs have a sizable impact on the national economy. Between 2006 and 2012 immigrant-founded technology companies in the United States employed 560,000 workers and made $63 billion in revenue, the Kauffman report found.

“The more you can have entrepreneurs in the economy, the more you can grow,” Werling said. “Competition from new businesses helps the economy, especially a mature economy like the United States.’”

Immigrants owned about 18 percent of small businesses in the United States in 2010 despite the fact that they made up only 13 percent of the country’s total population, according to U.S. Census data.

“Coming to a new country is a tremendous risk itself,” Su said, adding that the risk-taking personality encourages people from other countries to innovative. “You have to have some goal in your mind that you are going to reach.”

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About the Author

Maria-Pia Negro is a graduate student at the Philip Merrill College of Journalism at the University of Maryland and has freelanced for The Prince George’s Sentinel and AOL Patch in College Park and Gaithersburg. She interned last summer for Catholic News Service, a DC-based news wire service reporting on religion. She also interned for The Urbanite, a monthly magazine in Baltimore. She graduated summa cum laude from Loyola University Maryland in 2011 with a bachelor’s degree in communication and writing. Her work and resume can be seen on her personal website.