Where do you go in this world if you’re young, smart, ambitious, and want to start a business and make millions? The U.S. of A. of course, everyone knows that! Or do they? The U.S. has a history of being a home for entrepreneurs and the place where anyone can come, from anywhere, and make millions of dollars by founding their own business. It’s completely apropos that the father of the U.S.A., George Washington, was himself an entrepreneur and farm owner.
One could argue (and many do) that the U.S. has fallen from its perch as THE place to come to to start your own business. Various reasons can be given for this, including one of the highest corporate tax rates in the world, a highly progressive tax system that is under pressure to become more progressive every year, increased government regulations that raise the cost of doing business, unions (which, of course, are effectively businesses in themselves with political top cover and the advantage of being able to automatically grab their revenues from workers’ paychecks in many states), and high labor costs. I have heard that many other countries have surpassed the U.S. as THE place to go to start a business, including Israel and Canada.
This topic is worthy of a few more blogs, so I’d like to focus this posting on an example of someone who has exemplified the American success story. I met Calvin Lam in the EMBA program at UCLA. There were several people in the class who very clearly were already successful, and Calvin was one of these. Calvin and I became friends during the program and as I started my first company, Calvin was one of my mentors. He offered continual advice, with critical tidbits that I still treasure and repeat (always with credit to the source), such as “The fastest way to make 7 figures in America is by starting a business in a non-sexy industry. If you go the executive route in a Fortune 500 the competition is hungry and smart. In a venture funded company the VC’s control your future and the success rate is low. In non-sexy industries you are competing with mom and pop shops (no offense, I had a mom and pop just like everyone else but they probably wouldn’t have made great business owners) and your chances of success are greater.”
Calvin and his family are from Vietnam, where they owned a clothing factory. After the fall of Saigon, all businesses were nationalized, which resulted in the communist government carting off all equipment and machines from their family business. Overnight, they lost their factory. The only two forms of enterprise allowed at the time were cooperatives and state-owned-enterprises. The family fled in a rickety boat, under cover of night, to Malaysia, first Calvin and two siblings with their uncles and aunts, followed by their younger sibling and parents shortly thereafter. The entire family lived in a makeshift refugee camp on a desert island, having to erect their own thatch leaf one room hut with no toilet, running water or power. After a year of this, they finally were able to immigrate to the U.S.
Once in the U.S., the children applied themselves to their studies – what was it to study seven days a week and take the hardest classes when you had regular meals, a real roof over your head and endless rewards for your efforts? Calvin graduated high school with honors and received his B.S. in Electrical Engineering from U.C. Berkeley (a good engineering school, I’ve been told). He went to work as an engineer, which by itself is a challenging and lucrative profession, but still strove to achieve the American dream. He got his real estate license and broker’s licenses and tried his hand at those fields for a while. Finally he and eight friends got together and decided to form a company, the nature of which was yet to be determined. Of the eight, only Calvin and one other (his future wife Marie, a very sweet and beautiful lady, would later join) followed through and formed the company, a “white box” PC assembly and PC part distribution firm. Calvin and his partners built the company up to $120M in revenue before selling it.
After the sale, Calvin planned to take it easy for a while, but that’s just not the nature of a true entrepreneur. Seeing the rapid expansion of the Vietnam economy, Calvin traveled to Vietnam and decided there was opportunity there with the embracement by the Vietnamese government of a “Chinese” style of capitalism. Calvin still spends most of his time in Vietnam, running a real estate development company, a chain of lingerie stores aimed at the burgeoning middle class, and teaching at a local university.
Is Calvin’s story unique? Did he have some unique qualities that made him able to do what most Americans dream of but never achieve? I think the answers are no and maybe. There are tens of thousands of stories like Calvin’s. Is Calvin unique though? I consider Calvin a good friend, extremely intelligent, exceptionally driven, but he is not unique in those qualities. Calvin, however, thought that he could achieve success in his own business ventures, was not afraid to try, fail, and try again, and knew that America was a unique place that would allow him to apply those qualities and achieve financial independence at a young age. It is notable that Calvin went back to Vietnam because he saw greater opportunity there, however, a story for another posting.