What does it take, as a woman, to become a billionaire?
There are 1,011 billionaires in the world right now. Since they released the numbers in March, Forbes has been running various pieces on subsets of the billionaire population. Lately, that subset has been women (like here, here, here, and here). While a great way to re-package dry numbers into interesting stories, the coverage has raised more questions than it has answered.
The numbers
Why So Few Women?
The obvious question is: why aren’t there more female billionaires? Forbes brings a lot of possible explanations to the table. They explore economic factors, like how women are still in the earlier stages of their entrepreneurial journeys because the benefits from more opportunities take a while to trickle down. Or that women aren’t using venture capital the same way men do. They also explore the question in terms of the nature vs nurture debate: do women make less because obstacles prevent them from making more or because they choose not to? One one hand, the Forbes authors point to a lack of opportunities, citing statistics like the median income for jobs. On the other, they look at research that shows women are drawn to organizations that provide values beyond wealth, suggesting men and women define success differently: “Men tend to start businesses to grow them to be large and to be the boss while women start them to do something meaningful and to make a difference.”
Interestingly, a study of high-net worth individuals in Britain found that women are better at preserving wealth than men. Wealthy women now outnumber wealthy men in Britain 51%-49% (percent who had £500,000+ to invest), partially becuase they invest more conservatively and lost less in the financial crisis. What’s your take on the nature vs nurture arguments? And do they matter? Would you rather be on the billionaire list or have a company that makes a difference? Is that a forced choice – how much harder is it to be a billionaire and make a difference? Is risk-aversion another component to be factored into the nature vs nurture debate?
Why isn’t anyone celebrating their successes?
So far, most news outlets (like the WSJ, Telegraph, and more) have been focusing on the list’s gender gap. Forbes writes, “the dearth of them is itself a story, and begs the question of why so few?” Interestingly, very little attention has been given to women who did make it. Some you may have heard of, like J.K. Rowling (Harry Potter), Meg Whitman (eBay, politics), and Oprah Winfrey (media). Other names aren’t as well known, like Wu Yajun, a former engineer and real estate developer, Rosalia Mera, who went from making clothing in her home to founding Zara and 4,000-store clothing giant Inditex, and Doris Fisher, who started Gap, Inc. Read about all of them.
The “self-made” vs “inherited” distinction implies that the other 75 women (and 257 men) aren’t entrepreneurial. Is this really the case?
First off, the inherited number is pretty impressive in and of itself, considering that up until the 1970s and 80s the US Supreme Court was still overturning laws that made it difficult for women to inherit and own property, women currently only own 1 to 2% of titled land worldwide, and that patrilineal inheritance is a part of many cultures.
Then there’s their entrepreneurial-ness. Paris Hilton may have given heiresses a bad name, but even she’s an entrepreneur (she has her own record label and perfume line, among other ventures). While Alice Walton, daughter of Wal-Mart founder Sam Walton, inherited the bulk of her money when her brother died in a plane crash in 2005, she founded an investment bank, Llama Company, in 1988 and was the driving force behind the construction of the Northwest Arkansas Regional Airport. Alicia Koplowitz sold her shares in the family business, FCC, to her sister Esther; Esther has since transformed the company while Alicia focused on real estate, finance, and venture capital. Susanne Klatten, granddaughter of Herbert Quandt of BMW fame, gained most of her business experience while working under assumed names and then grew Altana Pharmaceuticals into the 4.6 billion euro company she sold in 2006. There are also women like Dylan Lauren, whose father Ralph Lauren is on the billionaire list due to his iconic clothing brand. She subsequently made the list of “heiresses to watch” because she started high-end Dylan’s Candy Bar, which is now one of the biggest candy stores in the world. Can you think of any others?
What’s the deal with China?
When it comes to progress in women’s rights, we’re pretty quick to write off China, infamous for its One Child policy that led to a gender imbalance. However, half of the self-made female billionaires came from China. Factors like the development of hospitable social and economic environments, which have encouraged women to get an education and start companies, seem to be playing a role. Constantly changing market regulations give Chinese entrepreneurs of both genders more opportunities to exploit and less red tape to deal with. Women are 36% of the Chinese work force, make up half of university enrollment, and contribute to half of household income. Fei Qin, lecturer in Entrepreneurship at the London School of Economics notes, “I grew up in Beijing and I’ve lived in Europe and in the UK but I would say China has the highest standard of gender equality anywhere. In my generation every girl in school knew the saying ‘women hold up half the sky’ and knew that a career would be a very important aspect of her life.” But what about just sheer numbers? China has an enormous population (which Forbes forgets to mention): in China, there are 474,871,442 women between the ages of 15 and 64, compared to the US’ 104,015,706, so it’s more likely 7 of them would become self-made billionaires. Then again, that’s 7 out of China’s 64 billionaires vs the US’ 3 out 403 total billionaires.
Photo courtesy of The Taipei Times.
Tags: Debate, Evolution, Statistics, Success, Women
Posted in Entrepreneurship, News & Current Events
It’s nice to see successful women, other than Oprah, mentioned on this list. The perception in the media is that you have to come up with a brillant children’s book (i.e., J.K. Rowling) or work you way to the top as a talk show host to make a difference and support yourself and your family. Regardless of whether they inherited the money or not, women are truly building great businesses.
Liked how your questions made the Forbes articles more interesting. As far as the nature-nurture debate goes it seems like a lot the nature things really fall into the nurture category, too. The different genders ideas of success dont necessarily have to be genetic because they could be a factor of how a woman was raised and the culture she was brought up in.
And now a question for you: why are we pretending like all these people made their money all by themselves? The original article says: ‘at least five of them started their business with their husbands, brothers or sometimes both’ as if this diminishes their achievements in some way. But it’s not like the ones w/o husbands and brothers had 0 male support and its not like the 100’s of men didnt have wives, sisters, mothers. Turning to the right people for help shoudnt be perceived as a weakness or a lesser achievement.
The traditional idea of women being the “homemaker” and men being the sole “breadwinner” is becoming more and more extinct. It makes sense that a women’s motherly instinct comes into play when searching for a career path, but that doesn’t necessarily lead to less success, as the few women billionaires have proven. It’s nice to see that women in China are driven and motivated to becoming successful as well. Eventually, this billionaire gender gap will slowly decrease with the rise of successful women.
I find it hard to believe that there are not as many women billionaires because of emotional differences between men and women. Instead, I think it has to do with the lack of opportunities that have been provided over the years. Women equality in the work force has evolved dramatically over the past few decades which is apparent in the fact that today, women are starting businesses at twice the rate of men. Many of the male billionaires on the list did not start their businesses within the last ten years and the longer ago it was, the harder it must have been for women in the same field to secure financing for start ups. I have no doubt that the number of women billionaires will increase exponentially in the years to come.
I don’t think the “inherited” vs. “self-made” distinction implies that the women aren’t entrepreneurial. Just because the money they used to start their ventures was inherited doesn’t mean their ventures are necessarily good ideas, in fact they could just be throwing away their inheritance. I think what is really important is the quality and lasting power of the ventures these women created whether they “inherited” or are “self made”
Your questions that struck me most from this article were: “Would you rather be on the billionaire list or have a company that makes a difference? Is that a forced choice – how much harder is it to be a billionaire and make a difference? It seems to me that often times the billionaires we hear about in the news do indeed make a difference- like Oprah, for instance, and her charitable contributions to society. I would think it’d be hard to have that much money and not feel the need to make a difference in the world by giving back to it. That being said, if I had to choose from the two alternatives, I’d like to think that I would rather have a company that makes a difference. But being a billionaire would be nice…
It’s surprising to hear that women in China have more gender equality than we’d expect! It’s a positive in light of so many negatives coming from China. More power to women in China who are setting a precedent.