John Byrnes: Where Are the Entrepreneurs?

This column first appeared in Corporate Report Wisconsin
http://www.crwmag.com/CRW/crw.html

By John Byrnes
Executive Managing Director
Mason Wells

In the past year, Wisconsin hosted the Wisconsin Entrepreneur’s Conference,
the Wisconsin Life Science and Venture Conference, the fourth Wisconsin
Economic Summit, the Evolving Healthcare Technology Conference, and the
Governor’s Conference on Economic Development.

These events were attended by people representing the now familiar
government agencies, community development organizations, schools and
universities, law firms, accounting firms, investment bankers, venture
capitalists, journalists and a host of consultants who play a support role
in our economy.

I think it is noteworthy that there were very few entrepreneurs at any of
these events.

So, where are the entrepreneurs?

It might be that entrepreneurs are almost extinct in Wisconsin. They have
either died off or been driven away by taxes and regulation. I don’t believe
that, although it seems so from all the blame that is being heaped on
government and education these days.

I think it is time we stopped blaming those who aren’t responsible for the
problem – our public institutions don’t lead our economy, they follow it.
Our culture in Wisconsin may be more at the heart of the problem. We may be
dealing with the long-term effects of an over-protective social climate that
discourages risk-taking.

When our young people grow up with the persistent influence of overweening
parents and media obsessed with finding fault, is it surprising that we
produce so few entrepreneurs? The lesson is clear: You cannot be too careful
because no mistake goes unpunished.

We may have encouraged all our young people to pursue secure jobs that
support conventional families and avoid risks associated with running their
own business.

We may also have socialized our most talented and ambitious young people
into careers that focus them on serving others rather than creating wealth.

Our economy may be overgrown with highly talented professionals with
outstanding careers in law, accounting, finance, education and government.
These jobs involve a person in business without requiring a commitment to
it, and therefore they promote a passive rather than an active role in the
economy.

A recent study by the California-based Milken Institute shows that Wisconsin
has more economic development offices and business incubators per capita
than almost every other state, including California. By my calculations, we
have a ratio of business-support people to entrepreneurs of about 100 to 1.
When I include educators the ratio exceeds 1000 to l. All these helpers with
no one to help!

The interesting thing about entrepreneurs is that they are hard to help –
they prefer to go it alone. Such people are undaunted by the knowledge that
the system is stacked against them.

* Entrepreneurs don’t fear failure because they don’t see it as an option.

* They enjoy solving problems as an outlet for their imagination and
creativity.

* They like living on the edge where stress is high.

* They know that business is a rapidly moving river of change, and they love
it.

While others are seeking help, entrepreneurs dive in and see what happens.

As the late Harry Quadracci used to say, "You have to be in the rapids to
run the rapids."

If we need more entrepreneurs in Wisconsin, maybe we should stop looking for
them in the usual places. While some of our future business leaders will no
doubt come from well-ordered suburban, predominantly white communities, it
seems more likely that most of Wisconsin’s future entrepreneurs will come
from those communities that missed out on the prosperity of the late 20th
Century.

They may come instead from low-income urban and rural communities where life
is hard and prospects for the future are not good. We may find the best
entrepreneurs in our underprivileged and immigrant communities. Our future
business leaders may be a diverse group of African-Americans, Asians,
Eastern Europeans and other immigrants from the Middle East, Pakistan and
India.

Talented people of color may well provide the needed entrepreneurial push
for our sagging economy. In this sense the inner city in Wisconsin may not
be our biggest problem, but our best hope.

— Byrnes founded Mason Wells, a leading Milwaukee-based private equity
investor in growth-oriented middle market companies, in 1998. He is a member
of the Wisconsin Technology Council.