Why Exporting Smart Kids May Be a Good Strategy

My son went to China last summer as a high school first year. He spent two weeks in Beijing and Xian with other smart, talented Nebraska high schoolers. He, too, is smart and talented – but he applied late to the program. Unfortunately, he had no problem getting in. Not because he’s great – but because it was way undersubscribed. With room for 30 (at about $1000 total cost to the families), Nebraska only sent 14.

There are times that I struggle with my home state because I believe strongly that we have an insular way of thinking that can be good because it allows us to build great organizations that can eventually grow out of the region – such as First National Bank or Kiewit. But, generally, I think this insularity and remoteness is bad because it prevents us from learning about what is happening in other parts of the country and world. And it hinders our ability to ultimately sell products and expand our businesses into new communities, regions, or countries.

As a learner (Gallup Strength #1), I am constantly on the lookout for new opportunities to learn “stuff” (that’s a technical term). And I have a strong inclination to travel and see what’s happening in other places. Thus, I am consistently baffled by the number of key Nebraskans and Nebraska institutions that think a primary public policy goal should be to retain all of our young people. I believe that it would be much better for us to send our young people abroad (from Nebraska) and learn cool things, build networks with people outside of Nebraska, and generally experience life outside of Nebraska.

I love Nebraska, but I also believe that we tend to be insular in the way that we think and act. Exposure to other places and ideas creates an ability to both be creative and find ways to leverage creativity to create new products via customers from elsewhere. All of this ultimately makes it easier to build companies that import wealth. Thus, I strongly subscribe to the idea that we should actually export talent and then re-import it after it has matured. Moreover, despite the conventional wisdom, Omaha is a net importer of talent from all over the country and world.

One country that does a great job of exporting and then re-importing its talent is New Zealand. New Zealand does an excellent job of gaining from travel and experience – and then inviting young, now seasoned executives to “come home”. The practice actually has a term – “Overseas Experience (“OE”).1 These “OEs” work in London or the United States and often work as Analysts in large firms. For example, when I worked at Enron, I worked with two Kiwis – Mike Roan and Kyle Berryman – who are both executives back in New Zealand today. These men gained experience in the US and then moved back to NZ with knowledge and capabilities that would have been hard to achieve if they had stayed at home.

This could be a model for Nebraska or other young talent exporting states. In particular, people often desire to move back to their hometowns when they get married, begin families, or when they have to care for an aging loved one. These life events create triggers where native Nebraskans may move home and import their new knowledge, network, and experiences to Omaha (or their home towns). This is a huge net win for Nebraska.

On a purely statistical basis, Omaha is already a net importer of talent. Omaha currently imports people from the following locales: St. Louis, Los Angeles, Rural Nebraska, and International (nearly 4000 from international sources alone in 2014). We do have a net negative export to certain communities around the country. including Phoenix, Denver, Atlanta, Dallas, Philadelphia, and Chicago (a total of approximately 2000 in aggregate to the listed cities).2 There is a chart below that illustrates the net migration patterns of the Omaha MSA over the last decade or so.3, 4

What is noteworthy about this chart, beyond just the fact that Omaha has had a significant positive net in-migration (despite the conventional wisdom of a brain drain), is the impact of international immigration to Omaha. Omaha has dramatically increased its population on the backs of immigrants. In 2014, this in-migration included nearly 2000 (1776 according to the U.S. Census) new Omahans from Asia. This group nets out nearly all of the people lost to the ten largest out-migration communities in the Census data. Thus, even if we don’t export our own, we are getting some international flavor from the flux of new immigrants to our community. But Omaha needs to focus on welcoming and integrating new migrants to ensure that the community at large benefits from their knowledge, networks, and experiences. It bears repeating that immigrants disproportionately start big companies.5

The third key reason that I think going “abroad” (which could just be Chicago or Denver, by the way) is important is that it helps the collective - us - build networks in other communities. Thus, when we need capital, insight, or talent, we can leverage our own or our near networks to satisfy these challenges. However, again, this is a challenge. When we look at key stakeholder boards in our state – whether they be corporate, non-profit, government, public, or private – do these boards have people of diverse backgrounds, particularly geographic. For me this is a critical way for us to build our networks for entrepreneurs to sell stuff. If we want a good ecosystem, we need to be able to call on people in Minneapolis, Kansas City, Boston or even Beijing with a “warm” introduction. Network density is a metric where Omaha and Nebraska consistently lag because we are remote and because sometimes we treat that as endearing or good – rather than as the impediment it is.

Thus, I would strongly encourage our public leaders and our ecosystem builders to build programs and bridges with other areas of the country and the world to ensure that our companies have customers and our kids have ways to learn about the world beyond our state’s borders.

 1 https://en.wikipedia.org/wiki/Overseas_experience 

2 https://www.census.gov/data/tables/2014/demo/geographic-mobility/county-to-county-migration-2010-2014.html 

3 http://www.clustermapping.us/region 

4 2010 was not available in the data source that I used, so it has been excluded completely for lack of data.

5 One example of many pieces of scholarship that back up this claim: https://hbr.org/2016/10/immigrants-play-a-disproportionate-role-in-american-entrepreneurship