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Forbes
Billionaires give Mom the credit
Those entrepreneurial instincts are formed in the nursery -- at least that's the theory behind the new billionaire-profiling film 'Lemonade Stories.'
By Dan Ackman, Forbes
The study of entrepreneurship in business schools is all the rage, but a new film released suggests that business school may be too late. The nursery is where it's at.
"Lemonade Stories," a film focusing on how mothers have contributed to the entrepreneurial spirit of their sons and daughters, suggests that much of what entrepreneurs need to know they learned well before, perhaps from the hand that rocks the cradle. Veteran film maker Mary Mazzio is the writer, director and executive producer of the film, which was funded by Babson College.
Entrepreneurs taking after -- and inheriting from -- their go-getting fathers is hardly news: Ted Turner, Rupert Murdoch and Donald Trump are just three examples of this phenomenon. But "Lemonade Stories" highlights the fact that sometimes it's a mother's touch that fuels the business-building spirit. While men have long blamed their mothers for failures in their personal lives, the film gives solace to those who would blame them for their business shortcomings as well.
The film focuses on The Virgin Group's Richard Branson, Def Jam's Russell Simmons, Home Depot (HD, news, msgs) co-founder Arthur Blank and USA Networks founder Kay Koplovitz, among others.
In the film, Branson says he learned to take risks from his mother, Eve, a pilot during World War II. Blank relates how his mother, a widow with a young child, could successfully run her own business.
"What is fascinating is that many of the mothers featured in the film were raised at a time when women were not expected to work. Yet all of these women were risk-takers and encouraged their children to take risks to achieve their dreams," says Mary Mazzio, film director. "These moms also stood by their children later in life, in moments of failure and times of crisis. Richard Branson and Russell Simmons both claim they would have gone out of business, but for last-minute loans from their mothers, who stepped up when no one else did."
Women drummed out
The number of chairs and professorships in entrepreneurship and related fields grew 71% in the last four years, from 237 in 1999 to 406 in 2003, according to the Ewing Marion Kauffman Foundation, a Kansas City-based organization devoted to the study and promotion of entrepreneurship. Babson College itself is at the forefront of this trend with its Arthur M. Blank Center for Entrepreneurship and recently created Institute for Family Enterprising, which emphasizes second-generation entrepreneurs.
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But the nurturing female hand, meanwhile, is being drummed out of the formal side of the business-building business. Women represent less than 10% of high-level venture capitalists, and they have been leaving the industry at twice the rate of men, according to a recent Kauffman study.
The same study says that women led 28% of all U.S. businesses in 2002, employing more than 10 million and generating $1.5 trillion in sales. Yet female entrepreneurs historically have received a disproportionately low share of available venture capital, as little as 4% to 9%.
"The venture capital industry is among the last bastions of male dominance in the business world," says Carl Schramm, president and chief executive of the Kauffman Foundation, noting that the current picture for female venture capitalists is similar to that for female attorneys in 1985, when women made up only 13% of the legal profession, compared to nearly 30% today.
Other viewpoints
But if still another Kauffman study is to be credited, the absence of women in the venture capital business may not be all that critical. The majority of startups are not started by venture capital, but by friends and family. According to the Global Entrepreneurship Monitor, a study of worldwide entrepreneurship released early this year, informal investors funded 99.96% of all businesses around the world and supplied 90% of the total amount invested. Fewer than 37 out of every 100,000 startups received venture capital money. Only in the United States did venture capital play a major role in new business funding, with U.S. companies attracting 80% of the money venture capital firms invested worldwide.
The global study also suggests that entrepreneurship is affected more by broad societal factors such as attitudes about risk and the prevalence of social safety nets. That the United States has such a disproportionate share of venture capitalists may be more of an effect than a cause of entrepreneurship here.
Of course, the formal venture capital money gets most of the press notice, and no one has yet endowed a chair in entrepreneurship at the grade school level. "Lemonade Stories" suggests that doing so might not be such a bad idea.
Copyright 2004 Forbes.com. All rights reserved.
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