FT: The teens that mean business

The teens that mean business

By Francesco Guerrera in New York

Published: April 19 2007 03:00 | Last updated: April 19 2007 03:00

Two years ago, nearly all Jasmine Lawrence's hair fell out after a chemical perm went horribly wrong. Today, partly because of that accident, she is at the helm of a haircare products group whose sales could top $1m this year.

Not a bad achievement for someone who cannot yet drive, drink alcohol or sign most legal documents: Ms Lawrence, the founder and chief executive of Eden Body Works, is 15 years old.

Standing in the basement of her home, in jeans and socks, it is hard to believe that this teenager fussing over dosing beakers and empty bottles recently persuaded Wal-Mart to sell her line of all-natural hair and skin products in its stores.

But as she settles into her "office" - the spare room of her New Jersey family home - and begins to explain Eden's history and business model, the qualities that caught the eye of the US retail giant, among others, become apparent.

Sitting at a desk dominated by a wooden plaque of the company's logo, a gift from a supplier, Ms Lawrence recalls that as her hair regrew after the accident, so did her confidence in a starting a business.

"The accident hit home for me," she says. "I looked for natural hair products and could not find them, so I decided to make them myself and found out I have got unique qualities that I could develop."

For all her talents, though, Ms Lawrence is not infact unique. She is one of more than 150,000 kids from low-income communities targeted by the National Foundation for Teaching Entrepreneurship, a US charity, over the past 20 years.

By offering schools in poorer neighbourhoods special modules to teach entrepreneurship, NFTE, whose donors include the Goldman Sachs Foundation and Microsoft, was initially set up mainly to keep problem teenagers off the streets.

Steve Mariotti, who founded the charity while working in a Bronx classroom in 1987, says he originally saw business teaching as an "anti-drop-out device". "I was teaching a problem class and I had trouble getting their attention by conventional methods," he says. "I started talking about different ways of sellinga watch and the class just listened."

But now, in the current global business environment, US teen entrepreneurs also embody a hope that goes beyond their own social redemption. Threatened by the rise of low-cost countries, and weakened by the disappearance of vast tracts of its manufacturing base, the status of the US as an economic superpower depends more than ever on supremacy in the realm of ideas.

In this respect, a supply of young entrepreneurs serves to reassure America of its enduring business vitality and banish the spectre of inexorable decline towards an economy made up of low-skilled services and cheap imports - "the massage capital of the world", as Jeffrey Immelt, chief executive of General Electric, has put it.

"If you focus on an entrepreneurially literate society, it becomes a global competitive advantage," argues Mr Mariotti. "In the long run, such countries will end up growing much faster than those focused on direct labour."

When it comes to operating such a scheme for teenagers, certain elements must be balanced. On one hand such courses must be effective at both keeping the kids out of trouble and giving at least some of them enough technical ability and confidence to become successful.

At the same time, they must guard against the danger that thrusting youngsters into the unforgiving world of business will create additional pressures and dislocations later in life.

On NFTE's original mission - helping pupils not to stray - the evidence suggests that the success of Mr Mariotti's watch-selling tips was not a fluke: business classes do help teenagers to focus on productive activities.

A 1998 study of more than 500 students in New York City found more than three-quarters of those who had attended NFTE's training saw starting a small business as a "realistic way out of poverty". Less than half of those who had not been through an entrepreneurship course held that view.

Andrew Kutches belongs in the former camp. A 19-year-old who last night was due to be honoured as one of the 10 best Young Entrepreneurs of 2007, Mr Kutches founded his construction business after at-tending a course in a facility run by San Francisco's Juvenile Probation Department.

"I have done things to survive that I am not proud of," he told the awards' organisers. "[But] I learned about the importance of a business plan to help you focus and manage a business idea that you have."

But only two of the 35 young people he did his carpentry apprenticeship with are still in work - a sign, perhaps, that, like other teenage passions, interest in business could turn out to be short-lived.

Especially so if their entrepreneurial duties end up eating away at their spare time. It is disconcerting to hear a 15-year-old like Ms Lawrence, the haircare mogul, describe herself as a "workaholic" and regretting she had to leave her basketball team due to work pressures.

But supporters of an early start to an entrepreneur's working life maintain the ingenuity and creativity of youth are difficult to replicate later. "If you wait until you are 30 to start in business, you have wasted a couple of decades in an entrepreneur's development," says one long-time supporter of NFTE.

Others argue that even if the kids give up, their know-ledge will not be wasted. "Whether or not these students go on to start their own companies, they will use these skills, be it in corporate America or even their own homes," says Anne Marie Agnelli, vice-president of community and public af-fairs at CA, the software group, which has donated $500,000 to NFTE.

Perhaps the most important outcome of the drive to nudge more young people into business is the opportunity to empower ethnic minorities.

Two Harvard University studies on the effects of entrepreneurship courses in Boston public schools found a "Latino effect": pupils from that ethnic group derived greater benefits from their business studies than their white or African-American counterparts.

According to the researchers, the Latino lead could be explained by the fit between entrepreneurship and self-motivation, and im-migrants' idealism and hunger to succeed.

Back in rural New Jersey, Ms Lawrence is expounding on her future plans for Eden Body Works.

"We are planning Eden International," Ms Lawrence says. "Then Eden Universal and" - with just a hint of a smile - "soon we will have Eden Inter-Galactic".

Impractical as a business proposition, perhaps, but a reassuring sign that, for her all her business acumen, she is still firmly rooted in her teenage years.

 

Succeeding is not child's play

By Francesco Guerrera in New York

Published: April 19 2007 03:00 | Last updated: April 19 2007 03:00

Being a teenage entrepreneur is no child's play, at least not for Abigail Lewis. The inventor of The Scribbler - a nail polish applicator that allows users to control the flow of the product - says her budding career has been hampered by legal and practical difficulties.

As she is still 17, Ms Lewis must be accompanied by her parents to board meetings of her own company and is unable to sign off legal documents.

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"That has been one of the biggest difficulties. I can't make any decisions on my own," the Kansas-based entrepreneur complains.

The success of The Scribbler, which looks like a pen and promises to do away with unnecessary spills, has also been threatened by wholesalers' patronising attitudes.

"A lot of people do not take it very seriously, I had a couple of people laughing at me and dismissing it as a kid's school project," Ms Lewis says.

The fact that she got the idea for her design by drawing on her fingertips with markers while bored in class does not help the marketing, she adds.

Like every good entrepreneur, however, Ms Lewis will not be derailed by a couple of setbacks. She is poised to sign up a manufacturer and is planning an exit from the business in a few years.

Ms Lewis says she eventually would like to sell The Scribbler to a cosmetics company and move on to a new venture. At least by the time she starts the next business, she will have the luxury of going to board meetings unaccompanied.

Copyright The Financial Times Limited 2007

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