Forget rebel, forget misfit, forget poor boy makes good. A new study shatters old myths about the entrepreneur.
THERE ARE THE WORKAHOLICS IN BLUE JEANS AND FLANNEL SHIRTS, STILL garage tinkerers at heart. There are the corporate mavericks, hand in hand with venture capitalists, looking to go public and make a quick score. You'll also find immigrants chasing the American dream, women and minorities, swashbucklers and techies.
In fact, if you look at the men and women who run the companies of the INC. 500, you can find almost anything you want. All the heroes of entrepreneurial myth are there -- the rebels and the misfits enshrined in pop culture, the disadvantaged finally given a place in the sun. But, if you look for someone who typifies the group as a whole, you are more likely to find Henry Stickney.
Norman Rockwell could have painted the portrait. Stickney came from solid middle-class parents who owned a dairy store in suburban Cleveland. In school, Stickney was in the top third of his class, and played first base on the varsity baseball team. He worked weekends and after school at the dairy, and was the first in his family to graduate from college. He's white, Protestant, and Republican, a good family man, married and never divorced. And today he runs his fast-growing medical-specialty company on Business Center Drive in San Bernadino, Calif., with his wife and two sons pitching in.
During the past several months, INC. and USA Today have been looking at the men and women who, like Stickney, run the fastest-growing private companies in America, the INC. 500. For years they have been touted as the leaders of an entrepreneurial explosion in America but, until now, they had never been studied as a group. Our interest was less in finding out how they run their businesses than discovering who they are, where they came from, and what makes them tick.
On the pages that follow we will explore the overreaching need of these executives to control their own lives and the businesses they run. We'll look, too, at their marriage patterns and investment patterns, their politics and hobbies, what they risked to build their companies to national prominence, and what they gained. And we'll analyze the differences between company founders and nonfounders, between men and women, between West Coast executives and East.
But more striking than the differences are the similarities among these '80s entrepreneurs in background, style, and values. Forget rebel. Forget misfit. Forget poor boy makes good. As a group, these creators of the new economy come straight from the mainstream, upwardly mobile Anglo-Saxon inheritors of the traditional American dream. Eighty-five percent are married, 7 out of 10 to their first spouse. They have 1.4 children and take two weeks off each year. They play golf, vote Republican, and prefer Time to Newsweek.
Their values are Main Street as well. Asked to explain their success, most cite such bedrock virtues as hard work and persistence. They worship a Protestant God at chruch and self-reliance at the office. And to those entering business, their most frequent bit of advice is, "Do unto others as you would have them do unto you." Tom Duck Sr., of Tucson, seems to typify the attitude toward life and business: "I was raised in Sunday School, and my folks were God-fearing Protestants. I was an arden Boy Scout. And my real values haven't changed. I always believed that you should be honest and hardworking and, some way, you would be blessed."
Only their success seems unconventional. The INC. 500 executives have not simply done better than their parents -- they have done appreciably better, with a median income today around $100,000. Over the past decade, on average, they have bought houses valued at $750,000 and amassed a net worth of more than $4.7 million. And these days they're likely to drive down Main Street in a Cadillac or a Mercedes.
America's entrepreneurial revolution is thought to be profoundly democratic, bringing increasing numbers of women, minorities, and those with lower-class backgrounds into the economic mainstream. But you'd never kinow it from looking at the executives of the fast-growing companies of the INC. 500. "This really is a land of opportunity," says Paul Woodruff, CEO of Environmental Resources Management Inc., "for those of us fortunate enough to have the right parents."
The statistics seem to bear him out. Ninety-six percent of the INC. 500 CEOs are white, 96% are men, and 70% are at least third-generation Americans. They grew up in traditional middle-class households: dad, three or more kids, and a mom who stayed at home while they were growing up. Psychologists, no doubt, would find it relevant that a disproportionate number were first children.
Dads' collars were mostly white, not blue. They were salesmen (13%), businessmen (23%), or professionals (19%). But most important, they were entrepreneurially inclined: more than half the CEOs had parents who had started or run a small business at one time. And no doubt their children first learned about running a business while sitting around the kitchen table.
Henry Stickney traces his strengths as a manager back to his parents, a father "who can sell anything to anybody" and a mother "who can organize anyone to do anything." The family dairy store was hardly glamorous; even with the seven-day workweeks and everyone helping out, it eventually went under. But the father's values would become the son's model. "He wanted to do everything himself, even make his own ice cream and grind his own hamburger. He took that much pride in his work," Stickney remembers. "He had a lot of independence; I guess that's why I'm in business."
If you ask the CEOs what, if anything, they "excelled" at in high school, they'll most often say "getting in trouble." But to hear them reminisce about their exploits is to be reminded of a simpler America, when skipping school, staying out late, or smoking in the boys' room were the accepted forms of adolescent rebellion.
In fact, the INC. 500 CEOs were achievers early on. More than a quarter were honor students in high school, and nearly a third, like Stickney, ranked in the top third of the class. They were active in school government, clubs, and church activities, and a third played varsity sports.
Paper routes and yard work were the traditional ways to earn pocket cash on Main Street, but, like Tom Sawyer and his white-washing, many of the future CEOs went significantly farther than that. Before they turned 21, 15% had a business with other employees, expenses, and profits. Darby McQuade, for example, cornered the local worm market in Richwood, W. Va., hiring his buddies to dig for bait he could sell at the beginning of fishing season. And John Cheney was into photography. He walked the streets of Houston snapping photographs of houses that he later developed, framed, and sold door-to-door. His enterprise grossed him several hundred dollrs a week through high school.
