Inspired

(Self-) Made in China

It may surprise you to learn that, while about 80% of the world’s agricultural output is generated by women, women own only about 2% of the world’s land.  It is understood that in many poorer countries women do not have the right to own property.  In others, those rights have been extended to women, but cultural norms, lack of knowledge, or the inability to work their way through the byzantine rules and processes, prevent women from owning real estate and, consequently, the fruits of their labors. 

Endeavor Global, the terrific organization that promotes high-impact entrepreneurs globally, has supported around 520 people in the 13 years of its existence.  Of those entrepreneurs only about 10% of them have been women and only half of that number were women starting businesses without the support of husbands, brothers, fathers, or other male partners.  It takes a different person to go it alone.

Consider the non-rural/non-farming world.  In advanced countries like the U.S., how many women do you know who are major property owners?  Why are there no female Sam Zells or Donald Trumps?  Owning real estate (especially for investment purposes) requires a high level of risk-tolerance.  It necessitates a strong degree of self-determination.  Either by culture or circumstance, these are traits that are harder to come by in women, but far from absent.  

 

The same seems to apply to female entrepreneurs and CEOs.  It is a stubborn truth that the percentage of women who make it to the top of the corporate ladder, running Fortune 500 companies, for example, remains far too small.  Only about 12% of the top CEOs are female in any given year.  Those who do make it to that level typically have risk-tolerance and self-determination in spades and when they flame out, they flame out big.  (For those of you old enough to remember, Jill Barad is a great example.). 

Of course brash male CEOs can have bumpy rides too (Mark Hurd?), but they tend to be more easily forgiven.  Being brash is an admired trait for a guy, but tends to be a tougher attribute for a woman.  Many top female CEOs lead without significant controversy, Indra Nooyi or Andrea Jung, for example.  For others, their visibility provides them opportunities to reinvent themselves in new ways, such as Carly Fiorina and Meg Whitman, embarking on political journeys of late. 

 

From an entrepreneurial perspective, women are starting businesses at a record pace, still about twice as many female-owned start-ups as male-owned.  But there is a very large disconnect between the buying power of women (the new “sheconomics”) and the scope of the businesses they tend to start.  According to Sharon Hadary, an expert on women entrepreneurs, who was quoted in the Wall Street Journal recently, “average revenues of majority women-owned businesses are still only 27% of the average majority men-owned businesses.”  Some argue that this is because women are discriminated against, have less ability to obtain capital, do not have as much business knowledge as men, or the cultural acceptance of women working is just not there.  The most often cited reason is that women choose to balance work and family and struggle to have both in equal measure.  Another possibility, the most relevant one in my opinion, is that women tend not to think big enough.  I think it is a tendency to be less of a risk-taker and less self-determined to achieve wealth (versus short term income) that is the reason women less often fulfill their potential.  

Women who reach billionaire status are very few, only 14 on Forbes’ most recent list, but the number of self-made female billionaires is even less.  Many of the women on the list started (or inherited) businesses with their husbands or other family members.  Women who do it alone are really inspiring.  Both Martha Stewart and Oprah Winfrey have, on their own, achieved tremendous wealth and fame by creating a personal brand.  They are among the most prominent examples of cross platform self-promotion.  J.K. Rowling was the first of any author, male or female, to achieve billionaire status.  Her “rags to riches” story (going from a single parent on welfare to a billionaire) is well known.  But why are there so few female billionaires?  Where are the other Martha Stewarts, Oprah Winfreys, and J.K. Rowlings of the world?  The answer?  China. 

 

Take a look at the Forbes’ ranking of female billionaires and you may be surprised to see that more than half of them are Chinese and quite a few are real estate developers.  This is astonishing on many levels – because the ability to “own” real estate in China is still nascent, the number of women real estate owners/developers is still statistically insignificant globally, and women are still so rarely entrepreneurs on a large scale.  It also reflects a potential major philosophical shift in China from a collectivist mentality to one that promotes individualism.  And it is apparently possible for women to capitalize on that shift and succeed in a very big way.

 

Thomas Friedman wrote a terrific column recently in the New York Times where he talked about these two new forces – the rise of China as a superpower and the rise of the influence of the “individual” (his example was Wikileaks).  He notes that these forces have positives and negatives and says “a stable world will require that we get the best from both and limit the worst.” Well put.   

Perhaps there is a sense in China that they are all on the cusp of a time of great opportunity.  Or maybe there is just a newfound cultural moxie that Chinese women possess.  Whatever it is, it seems that women in China think big.  Hopefully these trailblazing women will inspire the next generation of global female entrepreneurs to think bigger and there will come a day when the media will not find it unusual to see self-made women billionaires.

 

 

A Long Saudi Drive (version 2)

Knit together by social mediums, the black triangles, slashed by young, excited eyes, progressed to forbidden vehicles.  Not quite blithely, they took the wheel, unnaturally entering foreign roadways.  “It’s only driving,” they shouted. “We’re not asking to vote, after all!”  Both hoping and fearing to be seen, the YouTube women sought small purchase in their land of contrasts -- impoverished opulence, freedoms denied, anachronistic modernity.  

Called “Drivers,” an epithet.  The imprisonment video was not available. 

A triumph nonetheless.

 

 

A Long Saudi Drive (version 1)

Unnatural to her to be imprisoned in her own home, hastened to action, inspired by the Arab Spring, she sought the splendor … of freedom … of movement.  She sought to drive, like her sisters twenty years before, themselves inspired by American female soldiers.

Her constricted, archaic existence could not accept a modern woman.  “Women cannot drive,” said they, in fierce condemnation. 

Cloaked in her abaya, she wilted this spring.  YouTube showed her behind the wheel, but not in jail.    

 

Nuclear Fallout of a "Power"-ful Woman?

Each year Forbes Magazine compiles a list of powerful women.  For many years, that list has included Anne Lauvergeon, CEO of Areva, the French nuclear power company.  Highly intelligent and utterly fearless, Lauvergeon is known for her willingness to say “no,” something that is hard for many of us, particularly women.  The French government owns a majority interest in Areva and, thus, her bosses have included Mitterand, Chirac, and Sarkozy, people who don’t typically like being told “no.” Unfortunately, it looks like that feistiness may be catching up with her.

Lauvergeon is an inspiration.  She is a bit of a science geek – she has an advanced degree in physics – who saw an opportunity to build for the future by cobbling together several of France’s energy companies to create Areva, the world’s only vertically integrated nuclear energy company.  She uses the analogy that they are like Nespresso – they make the coffee machines and the coffee that is used in them.  In other words, they do it all – mine uranium, build reactors, and produce energy.  She took the helm of Areva, as CEO, in 2001 and has been able to successfully capitalize on the need for reliable, clean energy as the world has developed concerns about the continued use of fossil fuels.  In France, 80% of the energy use is nuclear.

Her intelligence and humor comes forth when you listen to her speak.  Charlie Rose interviewed her six months ago on PBS and she comes across as impressively as you would expect – smart, direct, funny.  She appears frequently in the media, sometimes with her husband (with whom she has two young children).  In addition to brains, she also possesses physical beauty and is incredibly fit.

2010 has been an interesting year for Lauvergeon.  She had a lot of big wins -- In August Sarkozy and Lauvergeon announced the creation of an International Institute of Nuclear Energy aimed at training nuclear engineering researchers around the world.  In October she inked a deal with Kazakhstan to build a fuel manufacturing business there.  In November, she signed a $20 billion deal with China. In December she structured a sale of two reactors to India for $9.3 billion.   Not a bad track record in a tough economy.

 In September, however, Areva suffered a human and PR tragedy when several employees were kidnapped by Al Qaeda operatives in Niger, where Areva operates a Uranium mine.  Lauvergeon was widely criticized for being silent on the matter for too long -- She did not appear in the press to discuss it for several weeks when she finally went to Niger at the site of the abduction to meet with the Niger government which was investigating. 

Additionally, she suffered negative attention for cost overruns as a plant in Finland.  And her focus on nuclear engineering was seen as a distraction from Areva’s core business.

Her year ended with strife between her and the government.  The government decides who runs the company, so her continued leadership is at their discretion.  With Europe’s financial woes, Areva has been mired in controversy over the capitalization of the company.  In December, the government forced a capital infusion that Lauvergeon says was not necessary, quite possibly to flex their muscles in controlling the company and Lauvergeon.  She long ago recognized Areva’s (and her own) vulnerability as a result of being owned almost completely by the government (France owns 93% and the Kuwaitis own most of the rest) and her crusade to spin out the company into a publicly-traded enterprise has not been well received.  Her view is that, in a field as competitive as hers, Areva's inability to be truly market-driven hampers their competitiveness.  Despite the support that Sarkozy has given her, the government does not appear to be swayed in her direction on the matter.

Just this week, Bloomberg reported that two new Chief Operating Officers had been named at Areva, tasked by the Chairman of the Board, with “preparing for the renewal or succession of executives whose terms end in June.”  That would be Lauvergeon who has expressed her wish to remain CEO.

“Atomic Anne” as she has been called, affectionately or not, has run a global enterprise for which she has managed more worldwide employees than any other woman in business.  At only 51, her accomplishments are inspiring.  Whether she remains at Areva in June or not, the world has not seen the last of this remarkable woman.   

Contrarians

 

There is a saying in real estate that you “make your money on the buy side.”  It isn’t really how profitably you sell it, but how well you buy your property that determines whether it is a “win” or not.  As with all great downturns, there will be those who will make a killing by taking advantage of the nature of cycles.  To paraphrase Warren Buffett, when the market is filled with fear, that is the time to buy.  The concept is really about being contrarian, moving in the opposite direction of the market. 

Of course Buffett can afford to be cavalier.  How about everyone else? 

 

Ten years ago, the market implosion was in technology, not real estate, with dot-coms collapsing at a steady clip.  Hardly the time to start an on-line retailing business.  But that is exactly what Natalie Massenet did.  She was a contrarian who rode a counter-cyclical wave to success through the creation of the luxury portal, Net-a-Porter.  Ten years after creating the company, she sold it this year to the Swiss investment group, Richemont, which also owns such well-heeled brands as Cartier and Montblanc.  Her payday?  $76 million (and she remains Chairman). 

What makes Net-a-Porter a compelling story?  On-line shopping isn’t unique.  It wasn’t even unique when it was founded ten years ago.  She isn’t designing clothes and accessories.  To put it in Venture Capital parlance – she’s a VAR (value-added reseller), not an OEM (original equipment manufacturer).   Massenet’s inspiring success story is that she is doing exactly what she wanted to do for a career in a completely untraditional and exceptionally profitable way.

Massenet started her career as a fashion editor.  She liked it and was good at it, but saw that a void in the marketplace existed where luxury shoppers could purchase high-end clothes and accessories they liked on-line.  Her unique understanding of how purchase decisions get made is what really made her business fly.  Massenet recognized that fashion magazines sell clothes.  Affluent women (read successful women with little free time) find shopping on-line to be highly preferable to buying in stores.  While the ability to see a Jimmy Choo bag or a pair of Christian Laboutin shoes in a magazine and finding them in one place on-line was something, Net-a-Porter’s well-designed website functions as an on-line magazine to boot.  Their marketing savvy leads them to provide highly addictive and visually stimulating weekly emails, customized to their shoppers’ purchasing habits.  The ability to see the merchandise on models with completely put together looks is a huge improvement over the websites of even the most upscale department stores and boutiques. 

 

Natalie Massenet has succeeded by giving women what they want – a gorgeous fashion magazine of well-made clothing and accessories that a woman can purchase from her iPad.  She understands the convergence of media and commerce and sees herself, not as an internet entrepreneur, but as a magazine editor.   Her intuitive nature sees opportunity in menswear now and her newest website, Mr. Porter, will be launching soon, offering the same experience, targeted for men, who are notorious for avoiding the shopping mall.

How many people must have told her that the timing was awful to begin an Internet start-up ten years ago!  Probably even her investment banker husband.  But she chose not to listen because she knew that she would succeed.  Her instincts and confidence were strong.  Her understanding of what her customers wanted was keen. 

Natalie Massenet is an inspiration – an opportunistic visionary who has created her chosen career in an entirely innovative (and exceptionally profitable) way.

 

Teach a Man to Fish

It seems counterintuitive to say that one can profit by giving away his knowledge, but that remarkable truth is becoming ever more obvious.  Undoubtedly the Internet has contributed to a more open world (for good or ill).  The recent leaking of thousands of classified Defense Department Cables by WikiLeaks makes it clear that everything is fair game and easily accessible.  The more positive view may be that the Internet is a vast library, filled with wondrous resources that can capture the imagination of millions and generate countless new ideas.

Intellectual property rights’ advocates justifiably fight to protect the creative output of writers, musicians, authors, software creators, whatever.  And it is fair to do so.  But could it be that it is possible to give away your work and have it come back to you, profitably, in other ways?

One of the most prolific examples is the cell phone industry.  The phones and equipment have virtually become fungible.  The money gets made on the service contracts.  Apple, while certainly not giving away its phones, has opened the door to countless creative types and spawned an entirely new industry with its “apps.”  No one can dispute the value creation that concept has generated for the company.

A lesser-known example, unless you are a photography aficionado, is Kevin Kubota.  Long ago, Kubota established a reputation as one of the top wedding photographers in the world.  That’s a pretty crowded field, but he has set himself apart.  Kevin is a great photographer, but he’s an even better businessman.  He’s figured out the key to success – help amateurs become great. 

Even if your idea of photography is snapping a shot with your cell phone, you’ve undoubtedly heard of Photoshop.  It is the most sophisticated photo-editing software available and is highly complex for beginners to learn.  (Not to mention expensive, with full versions costing around $1,000).  Kevin didn’t create Photoshop, but he created his own series of products (Action Paks, DashBoards, Artistic Tools and others) to make the process much simpler.  He offers bootcamps and webinars, has a blog, and has written books – all with the intention of helping the hobbyist photographer produce dramatically improved photos.   He’s the only US rep for Asuka Books, some of the finest photo books on the market, and he even has a company that will do your layouts for you.

Kevin is still a professional photographer, but he has become so successful in his evolution to entrepreneur that he would have no trouble putting food on the table if he never picked up a camera again.  His success has freed up time for him to be able to give his gifts to the community too.  Each year he offers a Family Photo Day in the park in his hometown of Bend, Oregon.  It’s hard for middle-income families to comprehend that a family photograph is a luxury for some people.  Kevin and his team partner with area agencies, such as Habitat for Humanity and others, to have a photo-shoot in the park, providing free portraits to low income families.   In keeping with his generous nature, he makes a “how to packet” available for photographers who want to start something similar in their community.

Kevin Kubota inspires people he meets by openly sharing his knowledge.  He’s learned a really valuable business lesson along the way too – there is great profit to be had by making your customers look good.

Saying More with Less to Many

“Facebookistan” is now the third largest country on the planet.  Imagine a place nearly as large as China or India, populated entirely by voyeurs and narcissists (read with humor).  The number of people on the planet who use Facebook has reached 550 million in only six years.  Almost twice as many people as live in the U.S.  And they are connecting in a new and very open way. 

As social media platforms emerged these past few years, psychologists and social scientists debated whether people would develop anti-social tendencies due to decreased human interaction.  The remarkable reality is that people are communicating MORE, not LESS; and they are doing it differently than in the past. 

 Gen Z does not use email and, in fact, some futurists predict that email will not be used at all when these young people reach the workplace.  Frankly, this demographic doesn’t use the phone much either.  Although it may seem to older groups that this type of communication would be less intimate, the inverse is actually true.  Short bursts of deeply personal thoughts shoot across cyber-space to a broad network of “friends” through Facebook posts, Tweets and blogs.  No wonder TIME Magazine named Mark Zuckerberg the Person of the Year.  Not since the invention of the telephone has the way we connect with each other been more radically altered.

David Brooks wrote an interesting column in the New York Times in October, called The Flock Comedies, about the genre of television shows emerging over the past decade of “diverse friendship tribes.”  The idea that people have traded intense one-on-one relationships for “packs” of friends seems born out in social networking, as well as on television.  The connective tissue that binds us together has become more diffuse. 

An interesting by-product of the Facebook revolution is the intersection of narcissism and voyeurism.  Now that every ten year old has a cell phone equipped with a camera, a new wave of self-promotion has emerged with entire galleries of self-portraits happily posted by their owners.  The voyeuristic contribution comes from their network of friends who cheerily comment on how beautiful they are.  There is, of course, a dark side to this, but hey, we’re boosting each other’s self esteem, right?  A positive view is that “photography” has become a creative art form for an entire generation of teens.

What makes a business successful?  Look at any example and you will find the same theme repeatedly – give people what they want.  TIME had a fantastic observation about the success of Facebook in their “Person of the Year” issue.  It is that, “People don’t want to escape their lives.  They want to be more deeply embedded in them.”  With a vast network of friends embedded with us, it isn’t a lonely place at all.