Silicon Valley may embrace venture capitalist Ben Horowitz's 'tough guy' school of entrepreneurship, but that's not what it takes to succeed in business.
FORTUNE – America’s fascination with the success of a handful of young tech entrepreneurs who have amassed huge fortunes has led us to mistake a small part of entrepreneurship for the whole. That small part is the Silicon Valley variety – “shoot for the moon, pivot fast, and use other people’s money.” By endlessly extolling this model, America’s business, academic, government and media elite are inadvertently dissuading most highly qualified women, and many highly qualified men, from pursuing their entrepreneurial aspirations.
Depending upon whose numbers you use and the specific definition of a new company, 300,000 new businesses are launched in the US every year. Venture capital plays a role in less than 2% of them, according to the Kauffman Foundation. These few venture backed firms, receiving about 10% of the money invested in all startups in any given year, proportionately account for 10% of the country’s entrepreneurially generated economic growth.
We are justifiably proud of this unique part of our entrepreneurial ecosystem and should continue to nurture it, but not at the expense of the entrepreneurs who generate the other 90% of our entrepreneurial growth – or the women and many men who would like to join their ranks.
Women represent almost 40% of our nation’s entrepreneurs but only a miniscule number of companies backed by venture capital, according to a Kauffman report. And many women, led to believe that moon-shot entrepreneurship, overnight valuation-sensations and the culture that goes with them is the only game in town, may turn away from entrepreneurship entirely.
Consider what that culture looks like seen through the prism of the latest business best seller, The Hard Thing About Hard Things, by Ben Horowitz, one of Silicon Valley’s most successful venture capitalists. Horowitz, who also founded and led an early cloud computing company through many harrowing challenges to a billion dollar plus buyout, is a great example of success, Silicon Valley style.
He is an engaging writer and most certainly has an interesting story to tell, but it’s hardly the whole story about what it takes to succeed as an entrepreneur. According to him, entrepreneurs should publicly and sarcastically chew out employees, profanity infused cultures have inherent advantages over less profane startup cultures, and questioning bosses can be grounds for dismissal.
This tough-guys-always-finish-first myth is not supported either by facts or research on entrepreneurial best practices. Implying that these are best practices – claims parroted by the media and other influential people – serves only to discourage most aspiring female entrepreneurs, along with many aspiring males. Because they do not want to create or work in a ‘hard things’ culture they feel incapable of succeeding.
Princeton University recently asked a committee of faculty, students, and administrators to study a disturbing trend that has been unfolding on most campuses for the past 15 years: Fewer and fewer women even aspire to high-profile, ‘high-resume’ student leadership positions. According to the report, “women tend to undersell themselves, sometimes making self-deprecating remarks in situations where men might stress their accomplishments.”
Women at times feel they are “expected to measure up to an impossible standard” when it comes to social behavior – being “poised, witty and smart – but not so witty or smart as to be threatening to men.” A recent Kauffman Foundation report that reviewed research on the experience of women in high tech businesses noted widespread disenchantment with their jobs and career prospects. Many of our most capable women would rather change careers than work in a “tough-guys-always-finish-first” culture.
The entrepreneurial success stories of Oprah Winfrey or Wendy Kopp, the founder and Chairman of Teach for America, provide better examples for all entrepreneurs to emulate. Oprah, who built a billion dollar media empire from nothing, is rightly lauded for being an empathetic, inspirational and empowering leader. Kopp took an idea that nobody but her initially cared about and turned it into one of the world’s most important educational enterprises.
Her memoir, One Day, All Children, provides welcome relief from the tough-guy school of entrepreneurship. It deals honestly with her entrepreneurial mistakes and epiphanies. Through it all there shines the attributes that successful entrepreneurial leaders like her and Oprah share: They set extremely high expectations for everyone on their team and then inspire everyone to meet those expectations
Entrepreneurs who can develop their own style of setting high expectations while empowering and including all of the members of their teams can finish first. But until they can hear that message over the constant din of the tough-guy stories, they may not be inclined to try. Few Americans, of any political persuasion or cultural background, would dispute that a vibrant entrepreneurial culture is essential to our economic prosperity – the continued propagation of a destructive myth is not.
Cornelia Huellstrunk is associate director, Princeton University’s Keller Center for Innovation in Engineering Education, Derek Lidow is the author of “Startup Leadership” and teaches entrepreneurship, innovation and creativity at Princeton University. He was the founder and former CEO of iSuppli Corporation.