Striking It Rich

A new breed of risk takers is betting on the high-technology future

It is among the most durable of American dreams. The young man with a bright idea for a new product or service decides to form his own company. He invests his family's savings in the new venture. He is soon working 18-hour days but does not mind because the company is his own. Sales start sluggishly, and he makes enough mistakes to fill a textbook. Eventually it all pays off. Profits boom; he makes it big. He becomes wealthy beyond his wildest hopes.

That is not just some Walter Mitty fantasy. New businesses are being created in the U.S. today as never before. Last year some 587,000 companies were incorporated, 80% more than in 1975 and 53,000 more than in 1980. During the past 18 months, hundreds of people became millionaires or multimillionaires when shares in their new companies were sold to the public for the first time. Among the stock winners: Bill Saxon, 53, of Saxon Oil Co. ($212 million); Philip Knight, 43, of Nike athletic shoes ($178 million); Herbert Boyer, 45, and Robert Swanson, 34, of Genentech ($32 million each).

Some of these successful new capitalists are tinkering innovators in blue jeans, while others are button-down bankers with M.B.A.s. Some are immigrants or the sons of blue-collar workers, while others are from old established families. Most are still little known outside their own fields. Frederick W. Smith, 37, is just another guy named, well, Smith. Yet his company, Federal Express Corp., has become a $600 million firm by delivering packages that "absolutely, positively have to be there overnight," as its ads claim. Nolan K. Bushnell, 39, invented Pong, the first video game, in 1972. He then sold his company, Atari, to Warner Communications in 1976 for $28 million. Steven Jobs, 26, the co-founder of five-year-old Apple Computer, practically singlehanded created the personal computer industry. This college dropout is now worth $149 million.

Even though the U.S. languishes in its third recession in ten years, and industries like autos and steel seem incapable of competing with the Japanese, the bright, bold and brassy risk takers are not only thriving; they are leading the U.S. into the industries of the 21st century. Writes George Gilder, a supply-side theorist, in Wealth and Poverty: "Entrepreneurs are fighting America's only serious war against poverty. The potentialities of invention and enterprise are now greater than ever before in human history."