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A Spike in Entrepreneurship Among Latin American Immigrants

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Robert Fairlie, chair of UCLA Luskin Public Policy, spoke to the Wall Street Journal about a spike in entrepreneurship among Latin American immigrants, who are starting businesses at more than twice the rate of the U.S. population as a whole. Startups of all types swelled in 2020, as COVID-19 upended work lives, changed consumer behavior and created business opportunities, according to an analysis of U.S. Census data conducted by Fairlie. “COVID has put us on a different trajectory,” he said. One reason that Latin American immigrants have maintained a strong entrepreneurial momentum is their focus on sectors that have experienced increased demand since the onset of the pandemic, including food, services and delivery, Fairlie said.

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Venture Capital Data Shows L.A. Struggling to Meet Diversity Goals

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The Los Angeles Business Journal shared findings from a UCLA Luskin report that analyzed the diversity of venture capital investments in the Los Angeles region in 2022. While Greater L.A. leads the country for the amount of capital funded to entrepreneurs from diverse backgrounds, progress in meeting racial and gender equity goals is lagging, according to the report led by Jasmine Hill, assistant professor of public policy. Hill’s team produced the report in partnership with PledgeLA, the Annenberg Foundation’s coalition of Los Angeles-based tech and venture capital firms that have committed to prioritizing equitable access to capital. The researchers found that less than one-third of PledgeLA firms’ 2022 investments went to companies led by women, Black or Latino founders, and these companies received only 4.6% ($6.4 billion) of the $139 billion invested. “If we’re being honest, it’s still way below where any of us would want it to be,” one founding member of PledgeLA said.

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New Book by Fairlie Reveals Risks and Rewards of the U.S. Startup Economy

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A new book co-authored by Robert Fairlie, chair of Public Policy at UCLA Luskin, provides a broad view of entrepreneurship that challenges the assumption that startup companies in the United States create jobs and power economic growth. Federal, state and local governments spend billions of dollars each year on incubators, loan programs, tax breaks and investor incentives to encourage the formation of job-creating businesses, yet these expenditures are often made without knowing whether they lead to lasting, decent-paying jobs. In “The Promise and Peril of Entrepreneurship: Job Creation and Survival Among US Startups,” published by MIT Press, Fairlie and co-authors Zachary Kroff, Javier Miranda and Nikolas Zolas use a comprehensive new data set to provide clarity. Their findings show that startup job creation and survival rates are much lower than those typically reported by federal sources. Official statistics indicate that each startup creates six new jobs on average, and 50% of startups survive up to five years. However, those numbers reflect only new businesses that have employees, not the millions of startups that launch without employees every year, the authors found. “Understanding the early-stage dynamics of entrepreneurship is important,” they write. “Starting a business is difficult, with many potential barriers and risks,” including the legal requirements and resources needed to hire employees. The authors also explore who owns startups, focusing on differences by race and ethnicity and documenting how some minority groups face significant barriers to entrepreneurship. Fairlie’s book is among five recently getting capsule reviews by the Financial Times, which lauds its use of reliably sourced data and says it will “help those seeking to nurture an entrepreneurial culture themselves: the policymakers, academics, incubator operators and business degree students.”

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Meyer Luskin Shares Insights on Responsible Entrepreneurship

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Meyer Luskin, benefactor and namesake of the Luskin School of Public Affairs, spoke to UCLA students about leadership skills and responsible entrepreneurship at a March 3 gathering held in person and via Zoom. Luskin shared stories from a long and varied career in investment advising, oil and gas, rental cars, beauty schools and, ultimately, the recycling of food waste. Scope Industries, the company he has led for more than six decades, turns tons of bakery goods that would otherwise have gone to landfills into food for livestock. “Meyer is a businessman who invented a business, and that’s not common,” UCLA Luskin Dean Gary Segura said at the event. “Meyer had an idea, and his idea was to take something most people threw away and make it into something useful.” Luskin’s talk included stories from his own UCLA education, which was interrupted by a tour of duty during World War II, and his experiences facing anti-Semitism as a young businessman. Luskin advised students embarking on their careers to examine their motivations, acknowledge conflicts of interests and uphold the highest ethics. “You have to be retrospective about yourself,” he said. “You have to take time to think about what you’ve done and where you’re going and who you are and what you want.” He encouraged those blessed with success in business to act responsibly and generously. “The first principle is get good people, pay them well, think about them,” he said. “When you do something that’s right, it comes back and helps you. … It just works that way in a long life.” 

View photos and a video from the event.

A Conversation With Meyer Luskin

 

Ong Highlights Disproportionate Suffering of Asian American Businesses

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Paul Ong, director of the Center for Neighborhood Knowledge at UCLA Luskin, was featured in an NBC News article about challenges facing Asian American communities during the pandemic. One study co-authored by Ong found that Asian-owned businesses were hit the hardest during the pandemic due to halts in customer-facing operations as well as increased racism. To better support lower-income and underrepresented Asian American and Pacific Islander communities, the White House announced an initiative to disaggregate data under the “Asian” umbrella and expand language options for federal programs. Ong noted that some Asian American entrepreneurs are immigrants with a rudimentary command of English that is not sufficient to navigate federal program applications, especially when the information is provided only in English. He said some older business owners were not aware programs like the Paycheck Protection Program existed and could not quickly move their services online. “There seems to be a double whammy,” Ong said.

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