Immigrant entrepreneurs bring electric ATV, big ideas to Michigan’s startup scene

At 8 years old, David Medina Álvarez knew what he wanted to be when he grew up: a transportation designer.

He envisioned inventing an electric supercar — flashy, luxurious, prestigious and, most importantly, fast.

Growing up in Morelos, Mexico, Medina Álvarez's hero was his grandfather, who lifted his family out of poverty by creating a real estate empire. When Medina Alvarez, 23, arrived in Detroit in 2018 to study at the College for Creative Studies he was eager to follow his grandfather's path.

"I could hear my grandpa and all of my family tell me, ‘David, you’re going to study abroad to create jobs, not to work for someone else,’" he said.

That entrepreneurial spirit is the crux of Global Detroit's Entrepreneur in Residence program.

Global Detroit, an economic development group focused on strategies for employing immigrants and international students, launched its pilot entrepreneur residency program in 2019. The aim was to slow Michigan's brain drain.

The state loses its international talent pool of students in hard sciences, engineering and business, many of them with masters or doctoral degrees, due to visa status.

Global Detroit's program partnered with the University of Michigan's Economic Growth Institute to connect immigrant startup founders with part-time university employment, enabling the founders to launch their startups in the U.S. As the startups grow, founders often are able to secure longer-term visas, said Steve Tobocman, Global Detroit Executive Director and former state representative.

As of March 2022, the program supported eight founders from seven companies. They collectively raised $15.6 million in venture capital and created 49 jobs. The startups produced more than $500,000 in annual recurring revenue.

"The first four years of Global EIR have proven that this model of supporting immigrant startup founders not only works, but can be a real asset to growing Michigan's startup economy and ecosystem," Tobocman said.

Related: Michigan's high-tech industries need foreign workers to drive future growth

Michigan's electric vehicle and mobility sector is in desperate need of people like Medina Álvarez.

The state added $5 million to the 2023 budget to fund global talent attraction and retention and appropriated the funds directly to Global Detroit and the Labor and Economic Opportunity office.

Of those funds, $4 million is for international student retention, skilled immigrant integration and attraction. The remaining $1 million goes to growing Global Detroit's Entrepreneur in Residence program in West Michigan and the Upper Peninsula.

Medina Álvarez saw in Michigan's aggressive $16 billion investment into the emerging EV sector "an opportunity to create without any limitations."

He spent much of his childhood visiting the ocean-front city of Acapulco and riding all-terrain vehicles along the coast. "I have really good memories with ATVs but I also have a couple of memories burning my ankles and breaking down the ATV because I decided to go into the ocean," he said.

This sparked the idea for the EQuad, his electric solution for a lighter, quieter and faster ATV.

Medina Álvarez's company Livaq is taking the EQuad prototype to international expos and hoping to land a spot at next year's Detroit Auto Show. Global Detroit is helping Livaq secure a space to build on its prototype in the Centrepolis Accelerator at Lawrence Technological University in Southfield.

"When I started this journey, half of the people were telling me that I’m crazy. The other half were telling me do it and see what happens. Only 10% said ‘we will help you,’" Medina Álvarez said. "Having that mechanism of support coming from [Global Detroit] is really important."

Lawrence Tech and Michigan Technological University are in the works as Global Detroit's next academic partners, alongside Wayne State and College for Creative Studies, Tobocman said.

Part-time employment at a university allows entrepreneurs to be exempt from the H-1B visa cap.

Michigan consistently ranks among the top 10 states for migrant workers with H-1B work visas, which allows companies to employ foreign workers in specialty jobs requiring technical expertise. The number of H-1B visas issued each year, however, is capped at 65,000, with an additional 20,000 for people with advanced degrees from American universities.

Up and down the line of STEM – science, technology, engineering, mathematics – international students comprise 40% or more of almost every critical field, according to the National Foundation for American Policy.

That is talent Michigan can't afford to lose.

Related: Immigration is saving Michigan from population loss, but state falls far behind national averages

In the business world, immigrant entrepreneurs continue to make up a larger slice of America's startup economy.

More than half of the U.S.'s unicorn companies — a privately owned company valued at $1 billion or more — had at least one immigrant founder, according to a 2022 study by the National Foundation for American Policy.

Miho Shoji, Global Detroit's first female founder, left her home country of Bolivia when she was 18.

Now at 38, she's sees the tiresome paperwork, legal fees and government interviews as part of business.

"Being an entrepreneur, you have to solve things. It's in your hands. Nobody will solve anything for you," Shoji said.

"[Being an immigrant] I think it's a little bit easier to solve things when you have already a mindset of nobody will give me anything — legal status, funding, anything — if I don't go and get it."

Shoji and her co-founder Alfredo Jaldin started their first human resource technology company in 2012 when they lived in Chile. The software tracked employee engagement with data rather than annual surveys.

Tracking personal data and using artificial intelligence was a tough pitch at the time, Shoji said.

When the business partners moved in 2017 to New York, they gained traction within the U.S.'s startup ecosystem and evolving technology. The pair learned new fundraising and employee recruitment strategies.

"I think this country made us who we are now," Shoji said.

But a student visa gave them a short runway to gain momentum. That's when the pair was introduced to Global Detroit and Tobocman, who Shoji calls her "angel." Employment at U of M and then the College for Creative Studies extended their status.

The Global Entrepreneur in Resident program gave them the time and resources to launch Moodbit, an AI program that analyzes, anonymizes and aggregates employee data to track culture shifts like employee burnout or dissatisfaction.

Pre-pandemic employers told Shoji they could gauge how employees felt by taking them out to pizza on a Friday. Remote work, though, put Moodbit in high demand.

Now the company has 11 employees and is on the path to raise $2.5 million in their next seed round.

"If we don't have these type of programs or partners, our lives — as immigrants, entrepreneurs, international students — is much, much harder," Shoji said. "Nothing is easy in entrepreneur or immigrant life but [Global Detroit] makes it a little easier."