Despite recent rumblings about his past, Bill Gates has had an incredibly successful career. He built Microsoft into a near $2 trillion behemoth, and has done a hell of a lot for education and world hunger.
But his mother was an IBM executive who sent him to private schools with computer access and later got his company a multi-million dollar contract.
Like many other entrepreneurial success stories, Bill’s shatters the illusion that we can get as far as him if we work hard enough.
Research suggests that more money does not in fact equal more problems. What it actually equals is a higher likelihood of success.
Last year, Israel’s Finance Ministry reported a strong connection between parental income and entrepreneurial offspring. As the home of Tel Aviv, the startup capital of the world, they would know.
There is hope – the study didn’t indicate whether children of wealthy parents became successful founders. Even family money is not a guarantee. It just so happened that Gates, Zuckerberg, and Bezos were given family money and did well. Plenty of parents have waved bye-bye to a chunk of their retirement funds for their childrens’ endeavours to flop.
But what if you don’t have the luck or the leg-up? As a startup founder, are you immediately at a disadvantage if you don’t have a nice dose of nepotism working in your favour?
The (not so) self-made
Most people know that Elon’s family wealth comes from emerald mining. Like Bill, Jeff Bezos’ parents invested $250,000 in Amazon. Even Zuck, the scruffy, ostensibly working class Harvard student got a $100,000 loan from his mum and dad.
We can’t even rely on old mate Jobs for a good garage-to-gazillions reference. He did start in a garage, but he had a comfortable, middle-class upbringing in the Bay Area (right place) and was friends with Mike Markkula, who’s stock windfall from Fairchild Semiconductor and Intel allowed him to invest $250,000 in Apple (right time).
Compared to what those investments turned into, these sums seem like small fry. But to most families, these are vast amounts of money. Some might, at best, have this kind of capitals in their homes. But it’s not just having it, it’s being able to lose it.
When seed-stage companies struggle to secure external investment like VC or angel funding, it’s either bootstrapping, friends and family, or failure. You can’t help but wonder how many working class founders might have dodged that final category with better connections and a cash injection.
Things are no better in the UK, despite the British breed of privilege being a much more open secret.
This isn’t an old stereotype – recent and current PMs David Cameron and Boris Johnson went to both Eton and Oxford. That means the UK has been governed by this embodiment of elite privilege for 9 out of the past 12 years. And it’s not just party leaders, it’s most of the country’s decision makers.
It’s clear the right education, and by extension the right connections, get you to influential places.
But looking at the most successful British businessmen, there’s an interesting contrast. Four out of the five wealthiest British entrepreneurs are self made.
Richard Branson’s dad was a barrister, and he went to a fairly nice prep school in Surrey. But he started out selling Christmas trees and budgies with no assistance. Branson stepping-stoned from a student magazine publication that he used to fund and advertise a mail order business that he used to fund his first record store. Fair play.
James Dyson, Britain’s 4th richest man with an $8 billion net worth, was born to two teachers, and lost his father at the age of 9. He engineered several inventions and famously built over 5,000 prototypes of the cyclonic vacuum cleaner before he found his astronomic success.
Graff Diamonds founder Laurence Graff started as a jeweller’s apprentice. Even the property tycoon Reuben brothers, worth $14.4 billion, started as carpet and scrap metal dealers.
The UK and AU share many similarities. The Brits feel more like family than our distant cousins in the US. So why do our social mobility levels vary so wildly?
As you’d expect, most of Australia’s richest are mining or farming magnates. Wealthiest citizen Gina Rineheart ($32.64 billion) is a mining heiress. Andrew Forrest’s family’s involvement in both farming and government goes back to the 1800s. Anthony Pratt made his own billions in paper, but his father was a manufacturing magnate.
Rupert Murdoch inherited Australia News (this one only half counts as he’s half American).
Even Atlassian founder Mike Cannon Brookes (4th richest at $26.2 billion) is the son of a global banking exec who spent thousands on his schooling. It’s not until you get to his cofounder, Scott Farquar in 5th place with $25.99 billion, you find a self-made man.
Farquhar’s parents worked in fast food restaurants and petrol stations and couldn’t afford a computer. A breath of fresh air!
But it seems, just like in the States, that Australian success hinges on huge privilege.
Is it really all about privilege?
Surely as most people in the developed world have access to higher education, and as the internet continues to blow open the information highway and accessible marketplace to all, the playing field is levelling? Don’t we have hustle culture now? Can’t we all just fake it til we make it?
Self-made billionaires do exist, but it seems very much an ‘exception rather than a rule’ situation.
But we working folk have some advantages.
Without the obligations of parent-funded educations or condition-laden loans, we have more freedom to choose our own adventures. We don’t have big shoes to fill or legacies to uphold. And avoiding cliches like the school of hard knocks, our awareness of the “real world” and what it is to struggle gives us excellent consumer insight.
In fact, founders of Gens X and Z tend to have more altruistic ambitions than going full unicorn. Our generation has a planet to save, after all.
We can still make money doing it, but in our opinion, that’s a much better legacy.