Yaron Valler, founder of Target Global, argues outsiders make strong entrepreneurs because they see problems others overlook, citing Wise's founders horrified by money transfer costs.
Valler says integration is the key to immigration, a two-way obligation governments must provide, support and enforce, and that open borders cannot coexist with a social safety net.
Valler says he has largely stopped investing in enterprise applications, backing instead a few companies challenging the view that LLMs are truly intelligent, such as Axonica Labs.
Why immigrant outsiders make strong founders, says Target Global's Valler
Yaron Valler argues that immigration and entrepreneurship are linked, and that Europe gains when it integrates newcomers well. Outsiders notice problems others overlook, which is how Wise began. The benefit depends on integration and controlled borders, which he treats as a government duty.
Takeaways
Outsiders make strong entrepreneurs. Valler says the link between outsiders and entrepreneurship is validated by research. Outsiders see problems differently and notice needs others overlook. Wise's founders, for example, were horrified by the cost of transferring money and built a company around it.
Integration decides whether immigration works. Valler calls integration the key to everything and a two-way obligation that governments must provide, support and enforce. He favors financial incentives to learn the language and not congregate, and rejects separate education systems because they create separate national narratives.
Immigration fears are overstated, but borders need control. Valler says fears about culture and jobs are real but overstated, since immigrants mostly take jobs that do not compete with locals. He calls uncontrolled entry irresponsible and says open borders and a social safety net cannot coexist.
Team quality outweighs every other investing factor. Valler says a bad team cannot be fixed while most other problems can. He looks for low ego, high energy and attention to detail. His failures usually came from misreading a founder's personality or cues at the start.
His portfolio shows immigrant-led companies scale. DocPlanner, a Polish company, teamed up with and acquired a Spanish business and moved out of Poland, and Target Global has exited most of its stake. Delivery Hero grew from a Berlin group founded by Lukas Gudovsky and run by Swedish immigrant Niklas Östberg.
AI returns are flowing to infrastructure. Valler expects some inference, LLM and foundation model bets to pay off, while utility models will be harder. He has largely stopped funding enterprise applications. He sees LLMs as statistical approximations of intelligence and backs a few companies challenging that paradigm.
Venture leads on immigrant founders, later capital lags. Valler says venture capital has led on backing immigrant entrepreneurs. Later-stage institutional, sovereign and private equity money is more local, so immigrant founders have less access to it. He adds that Europe should share its prosperity.
Valler's pick for a future unicorn
Axonica Labs builds brain-inspired inference semiconductors. The company comes from Israel, London and Germany.
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It has 20 employees, 12 of them PhDs. The team draws on brain researchers from Imperial College and chip engineers from Meta and Qualcomm.