One-quarter of the publicly traded, venture capital-backed companies started in the past 15 years in the U.S. were founded by immigrant entrepreneurs, according to "American Made: The Impact of Immigrant Entrepreneurs and Professionals on U.S. Competitiveness," a 2006 national survey commissioned by the National Venture Capital Assn. The current market capitalization of these firms exceeds $500 billion, and they employ more than 220,000 people in the U.S. and 400,000 internationally. Immigrants have had the greatest impact in the fields of IT, life sciences, and particularly in the high-technology manufacturing sector, where 40% of publicly traded, venture-backed firms operating in the U.S. today were founded by immigrants. This week, Smart Answers profiles two immigrant entrepreneurs.
Diego Borrego was technically born in the U.S., but the indigent clinic where his Mexican mother gave birth in El Paso, Texas, was only a softball throw north of the Rio Grande. When he was picking lettuce with his parents in Chamberino, N.M., Borrego never dreamed he would get a master's degree, do a fellowship at the Massachusetts Institute of Technology, become an engineer, and start his own company. The son of illegal migrant workers from northern Mexico who eventually secured green cards as sponsored agricultural workers, Borrego founded Networkcar in 1999 and currently serves as the firm's director of engineering.
Borrego spoke recently to Smart Answers columnist Karen E. Klein. Edited excerpts of their conversation follow.
What does Networkcar do? And how many employees do you have?
We have 70 employees, and we design and market software that provides wireless vehicle management to fleet managers. The installed software monitors vehicles' locations and diagnostics wirelessly, reporting up-to-the-minute status via the Internet. Our clients include small firms that have fleets as small as five or 10 vehicles, and fleets the size of FedEx (FDX), which is one of our customers.
How did you start the company?
I patented some of the early technology and submitted the idea for the firm to a business plan competition at MIT, where I studied during 1997 and 1998 on a General Motors (GM) fellowship. I didn't win the contest, but I got second place. After I finished the fellowship and returned to GM, I pulled together some of the guys who had worked with me on the contest, and we decided to follow through and start the company.
Can you describe your childhood?
My parents met in Ciudad Juarez [Mexico], and they married there before they entered the United States illegally. I'm the oldest of four kids [all born after his parents settled in the United States]. My dad was eventually sponsored for legal status by the farmer he worked for, picking cash crops like cotton, alfalfa, onions, lettuce, and cucumbers. When you work on a farm you do a little bit of everything, so I think I got my entrepreneurial genes from my dad. He learned to drive and maintain all the farm machinery. He was always learning something new. He just retired last year.
Did you parents want you to get a college degree?
My parents didn't have any notion of college or higher education. If anything, my dad viewed higher education as a bit of a negative. He would drive into Las Cruces, where New Mexico State University is located, and see the rich, partying college kids—and he didn't like that.
But one thing my parents had was a very strong work ethic. My father was up at dawn and worked until dusk every day. He insisted I get a job as soon as I turned 15, and he made us all understand the value of hard work. So I grew up working on the farm, but I didn't have any aspirations about college. I went to a tough high school that had a lot of gang problems and a drug trade.
I didn't get caught up in it because my parents were so strong on discipline and listening to your teachers. My greatest fear in the world was that one of my teachers would call my father if I did anything wrong.
How did you get on a college track?
I was very lucky to be influenced as a senior in high school by a guidance counselor and a science teacher. I was an arrogant, brash kid but I got good grades because I was afraid of what my father would say if I didn't. My senior year, I just wanted to take the minimum classes and spend the rest of the day working on the farm, because I had a truck payment to make. But this counselor saw my grades and told me to sign up for calculus, physics, honors English, and chemistry. I resisted, but he said, "I can call your father, or you can do what I tell you." That settled it.
I spent three hours every day with the school's science and math teacher, Antonio Lara. The first day of physics class, he asked, "How many of you are going to college?" All the kids sitting up front raised their hands, and a couple of us in the back did not. The rest of that year, he made that peanut gallery his project. He knew exactly how to deal with me, because he knew I thought I was smarter than everybody else. He prodded and motivated me, and he also taught me a lot about the world around me, so I managed to learn some science from him as well.
How did he motivate you?
He'd say things like, "You think you know it all, but you're not taking the SATs because you're afraid you're going to get worse scores than all the Anglo kids." He challenged me and all I wanted to do was prove him wrong. He was intimidating and he laid down the law, which was tough in that kind of atmosphere, but in less than one year he had managed to turn all of us in the peanut gallery around.
Where did you go to college?
I got good marks on those SATs and my ACTs, and I scored a four-year National Science Foundation scholarship to New Mexico State University. I didn't know what I wanted to major in, but when we lined up for registration I saw that the line for physics majors was short, so that's how I started out.
You went on to get a bachelor's degree in electrical engineering and a master's in optical engineering. What did your parents think?
My father was so disappointed that he didn't speak to me for more than two years after I moved to the dorms because he wanted me to stay and work on my grandfather's farm, which he hoped I would eventually inherit. In fact, when I left home, he told me never to come back.
It wasn't until I was a junior, and had switched to an engineering major, that I came home one weekend and told my mom I had gotten a summer internship working for General Motors in Indiana. I showed her my offer, and my dad realized that I hadn't even graduated and I was going to be making more money an hour than he made. That finally turned his thinking around, and of course now he's very supportive of education. One of my sisters is married to a microbiologist and works in the agriculture industry; another sister is a paralegal married to a lawyer; and my brother works for the Port of Oakland, Calif.
What challenges did you face leaving home and going to college after growing up in a migrant worker family?
At first it was socially very intimidating. After I got into New Mexico State I went back to Mr. Lara. He told me that I was going to be in classes with kids whose fathers and mothers work at Los Alamos [National Laboratory] and Sandia [National Laboratories] and when they come home from work, they talk about how they discovered a new isotope. And he said, "You're going to be the only kid in that class whose father comes home from work and talks about riding a tractor and milking a cow. But you know what, they've never picked onions and lettuce and worked as hard as you have. So you're going to have to be better than they are and work harder than they do, but you're not going to get tired because you're used to hard work."
My first semester was really tough, but I got a 4.0 and to me that was validation. I knew I could hang with those kids because I could work harder than they did. I've remembered those words of Mr. Lara's many times in my life.
There is a huge debate right now about immigration, and particularly about illegal Mexican immigrants. How does that make you feel?
I'm an engineer and I tend to think deterministically. I believe the problem is an economics problem, one of supply and demand. No fence is going to make a difference as long as there's a supply of good-paying jobs in the U.S. and a lack of them in Mexico and farther south. It makes me sad, sometimes, to hear people talk about the subject because there's so much ignorance around it. They don't understand the economic impact that foreign workers make on the U.S. economy.
So much of the strength of the U.S. economy rests on a foundation of workers who are just like my dad and my grandfather, who came to the U.S. legally to work in the Bracero Program. At one point we had the courage to recognize the need for a legal avenue for immigrants like that, and I had some high hopes before September 11 about that happening again, but everything was derailed after the attacks and today it's become an emotional issue for politicians.
I feel a moral obligation to help people understand the reality, and I try to be an example. Today, there are 70 people employed because my dad crossed over the border illegally, and I always remember that.