<br><h3> Chapter One </h3> <b>Nothing to Lose</b> <p> <p> When Marco Gomes was five years old, his parents sent him to school in Brasilia, about 40 kilometers away from home. He'd ride the bus to town with his father, who had a job building sofas for the rich people who lived across the lake. Gomes' mother had already taught him to read, but she didn't know math, and she wanted him to learn it from the best public school she could send him to. That couldn't be found in his home village of Gama, and math would wind up being important for Gomes. <p> School let out before his father would get done with work. So five-year-old Gomes would walk a kilometer to the huge bus station in the middle of the 1960s-modernist architecture of Brazil's capital city. Every day, his mother drilled his name and address into his head until he could recite it on command, but he could only do it if he recited the entire thing: <p> <i>Marco Gomes Quadra 34, Numero 130, Setor Leste, Gama, DF, Brasil</i> <p> <p> He'd mutter it over and over to himself so he wouldn't forget. Remembering that address was his only thread home. "I was like a robot," he says, driving around Brasilia today in his old Fiat. "Trained like a dog." <p> One afternoon, Gomes fell asleep on the bus and missed his stop. He found a policeman, walked up to him, tugged on his sleeve, and demanded: "Take me to your general." The amused cop took the gangly five-year-old to the station, where Gomes informed the captain he'd missed his stop and recited his address. The captain gave him a ride home in the front cabin of a paddy wagon normally reserved for hardened drug runners and smugglers—the ones Gomes knew in his neighborhood and his extended family. The paddy wagon pulled into Gama, sirens blaring, and his frightened neighbors poured out of their homes to see what the trouble was. Five-year-old Gomes bounded out with his backpack, saying "It's just me, everyone!" <p> <i>Lesson 1: No matter what happens, I can make it on my own.</i> <p> Gomes stopped going to school in Brasilia at six years old. His family could no longer afford the cost of his taking the bus and buying lunch every day. He missed the teachers. In Gama, many kids couldn't read until their teens or later, and he was bored sitting in class with them. He missed chasing the pigeons in Three Powers Square once class had ended, his arms and legs flailing. He even missed the bus. <p> Six-year-old Gomes came home to his parents' wooden shack, one of many homes he shuttled between in his early life. His father was hunched over a plate in the middle of the room. "Marco! Get in your room!" his mother shouted at him. His eyes stung with tears. He didn't like being in trouble, and he didn't know what he'd done. <p> He would later realize that plate was filled with cocaine, and his dad was an addict. That white powder his mother had always shielded him from was the biggest reason his parents didn't have money for him to take the bus anymore. It was the reason his parents fought. It was the reason his father lost a string of jobs. In years to come, the men who peddled that drug would gun down Gomes' cousin. The level of lethal violence in Brazil's slums, or <i>favelas</i>, is comparable to that of a modern civil war zone. In the worst areas, one in every five people has lost a loved one, many blaming the police for an inability or unwillingness to control the situation. Gomes lost only a handful of close friends growing up, but talking about death in Gama was as routine as talking about the weather. <p> "You remember that guy who stood on that corner all the time?" <p> "Did you hear what happened to that kid with the white bike?" <p> <i>Lesson 2: The quick money of Brazil's drug trade wasn't as glamorous as it looked.</i> <p> When Gomes was eight years old, a friend took him to an evangelical Christian church. Brazil is the world's largest Catholic country, but in the late 1990s, evangelical Protestantism took root in the country's poorest communities, where the Catholic veil-of-tears worldview was offering little hope. From 1991 to 2000, Catholicism fell by 10 percent in Brazil, and Protestantism increased from 9 percent to 15 percent of the population, according to the national census. <p> In places like Gama, the movement doesn't operate in opulent churches; it spreads out through holed-out rooms in concrete strip malls, next to convenience stores or barbershops. There's never a cross, because that's too Catholic. Instead, you can spot an evangelical church by the rows of neat, white plastic chairs and the drum set. <p> Gomes fell in love with evangelical Christianity. He liked the stories, the songs, the feeling of community, the belief that there was something greater—someone up there watching and taking care of him. In a world where his peers were getting seduced by the quick money of the drug trade, Gomes found Jesus intoxicating. <p> He went home after church one night, and his parents were screaming at each other. They were on the verge of divorce. That night he began to convert them to Christianity. Over time he convinced his father to give up cocaine, and saved his parents' marriage. His dad has been clean ever since, and his parents are now evangelical ministers in Gama. "Outside it was still chaos, but at least inside the house it was better," he says. <p> Gomes can't explain what he said to his parents that night that was so powerful. "You can look at it from a psychological point of view and say that drugs had cost my father everything, and he was now about to lose his family, too," Gomes says a dozen years later. "Or you can look at it from the supernatural point of view and say God saved him. I don't care. He stopped doing drugs." <p> <i>Lesson 3: No one was beyond redemption.</i> <p> Gomes started building computers at 12 years old. His uncles were smugglers, buying toys in Paraguay and spiriting them across the Brazilian border, where they'd sell them on the black market. When his uncles got busted, they switched to smuggling computer parts; most of the parts were small, and they could reassemble them back in Brazil. Gomes loved to tiptoe around the parts while his uncles slept, teaching himself how to put the building blocks for opportunity and information together in the form of circuits, motherboards, and hard drives, like an elf repairing shoes while the cobblers slept in the next room. <p> A few years later, one of his uncles found himself racing through the jungle with six huge cathode-ray-tube monitors strapped around his torso, when he decided he needed to make a change. After another bust, he went legit, opening a computer shop in a basement in north Brasilia, next to a sweat-soaked martial arts gym. He still assembled computers cheaply, but now he bought the parts in bulk through proper channels. <p> Gomes worked there every summer. He was yelled at when he made a mistake and teased ruthlessly in the way young boys are in a sprawling male-dominated family. But he made enough money to buy comic books and a skateboard, and he loved it. <p> His uncle's business—based entirely on word-of-mouth referrals—boomed. He was the richest person in Gomes' family. He had several houses, a car, and a speedboat that would cruise through Brasilia's crystal-clear, man-made Lake Paranoa, constructed in part to separate the rich government men from the poor. A single bus took the poor who worked for the rich across the lake in the morning, and a single bus took them back at night. They knew not to miss that bus. There was no other way across unless you had a car, or you had a boat like Gomes' uncle. "It was like the ones in <i>Baywatch</i>," Gomes says, adding sheepishly, "but unfortunately, we didn't have the girls." <p> <i>Lesson 4: Crime doesn't pay, but computers do.</i> <p> At 12 years old, Gomes got his first slow, dial-up Internet connection. He was as swept away as he'd been that first day in church. This connection introduced him to companies like Yahoo! and Google, and he read about the rich, powerful U.S. entrepreneurs behind these companies. He started teaching himself to code, not because he thought he'd be one of these entrepreneurs, but because he loved it the way he loved comic books and skateboards. The idea that he could build an Internet company was as ridiculous as the idea that he could become the next James Cameron just because he loved the <i>Terminator</i> movies. The thought didn't even occur to him. <p> It was like the days back when his father still had his sofa business, and Gomes would go on deliveries with him to the multimillion-dollar homes across the lake. Growing up in a world where degrees of poverty were measured by what the walls of your house were made from, Gomes gawked at the opulence. He saw a television set as tall as he was and stared at the ants in the Coca-Cola commercial that was playing at the time. On his tiny set at home, he could barely tell what the ants were, but on this set they were huge, vibrant, and pulsating with life. He could barely take his eyes off the TV, but it wasn't because he wanted it. This reality was too far from his life for Gomes to feel anything like envy. Like starting an Internet company, this TV was for other people, not for poor, half-educated Marco Gomes. <p> That was Lesson 5, only this time the lesson was wrong. <p> Ten years since he got that Internet connection, Gomes has founded his own Internet startup, taken venture funding, moved to So Paulo, and become an icon to other would-be Web entrepreneurs countrywide. In spring 2010, Gomes was on a flight to Europe, where he planned to propose to his girlfriend in Paris, France, and then pick up an entrepreneur award in Barcelona, Spain. His hands were sweating thinking of both events, and he couldn't help but reflect on his dramatic change in fortune. <p> Gomes had a lot of people to thank for how differently his life had turned out from the way it started: his mom for her determination that he study, his dad for getting clean, his uncle who taught him entrepreneurship wasn't just for drug runners, that friend who took him to church, and of course, the people who started the Internet. But mostly, Gomes had the 21st century to thank. Simply because of <i>when</i> he was born, <i>where</i> he was born didn't matter. <p> * * * <p> This book is about great entrepreneurs—the brilliant, the crazy, the cocky, the driven—the people who create companies that change lives and do more to lift thousands out of poverty than most government programs or nongovernmental organizations. We're not talking about subsistence-level entrepreneurs operating off micro-loans. This book is about the kind of high-growth entrepreneurs who are the dreamers, visionaries, megalomaniacs, and arrogant sons-of-bitches who see the world in a different way and set out to build businesses for reasons they can't always articulate; they just can't do otherwise. It's the kind of entrepreneurship that's created companies like FedEx, Apple, Google, and Microsoft and inspired millions more that they could do the same. And now, it's remaking the world. <p> Throughout corners of Asia, Eastern Europe, Africa, the Middle East, and Latin America, a combination of historical, geopolitical, technological, financial, social, and macroeconomic forces have created a primordial soup from which a new powerful generation of entrepreneurs are emerging. The West has two choices: Invest and partner with them or get shoved out of the way. <p> The world tends to think of Silicon Valley when it thinks of this type of entrepreneurship, but that's going to change in the next few decades, and the flow of money and talent is going to change with it. The point of this book isn't to discover the next Silicon Valley. There is no single next Silicon Valley. Communications and globalization has created a new world where the next great companies can come from anywhere, especially as a multibillion-person-strong, consuming middle class is rising, spread across geographies that were considered economic wastelands for much of the 20th century. <p> Because of the growth of Western multinationals in the developing world and the general meshing of cultures in the modern Internet age, this new entrepreneur is unlike what the world has seen before. This new entrepreneur is a mishmash between the mom-and-pop traders and retailers associated with the old world, contented to make enough to feed his or her family and little else, and the modern venture-funded, all-about-growth entrepreneurs of Silicon Valley. <p> These entrepreneurs live in a shrunken, globalized world. They may be grappling with emerging market problems, but their role models aren't someone in a nearby village. They are frequently names like Bill Gates, Steve Jobs, or even Donald Trump and Walt Disney. These entrepreneurs have an inkling of how modern venture capital works. They know tiny companies can become huge powerhouses quickly. They know high risk can be highly rewarded. They know David can beat Goliath. And this new global entrepreneur has three big advantages. <p> The first one is the home field advantage. Americans may wish the next few decades' growth was in the American heartland where the demise of manufacturing has left millions unemployed and local economies sputtering, but it's not. It's in emerging markets. Goldman Sachs first argued this point to Wall Street in 2001 with a paper entitled "Building Better Global Economic BRICs," in which the investment bank predicted that Brazil, Russia, India, and China would make up more than 10 percent of the world GDP by 2010. By 2007, it was already 15 percent. So much for the all-important G7 nations of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States; by the middle of this century, the seven largest economies in the world will be China, the United States, India, Brazil, Mexico, Russia, and Indonesia. <p> In these countries, growing middle classes are driving that growth, not simply the luxury purchases of the wealthy or corporate and government spending. Established U.S. companies with billions in resources would love nothing more than to pilfer those billions of new consumers for themselves. The problem is that they're not always good at it. For example, KFC may have dominated China's fast-food scene, but none of the Valley's Internet companies have done well there. The reality is that no place knows a big local market better than local entrepreneurs. <p> The second advantage is that in today's globalized world, money and talent don't have boundaries; they flow where the opportunity is. And the flow has already started to the emerging world. Right now, there is more than $100 billion in venture capital and private equity hungry to make money off the developing world, especially after the zero stock market growth over the last decade in the United States. <p> Meanwhile, many of the immigrants who came to the United States over the last few decades seeking opportunity are returning home. Duke Researcher Vivek Wadhwa expects hundreds of thousands of immigrants will return home to China and India in the next five years. Many more are getting shoved out of the United States by an increasingly hostile attitude toward immigrants and H-1b Visa holders. Still more who might have come to the United States a few years ago for college or graduate school aren't coming now. The year 2009 was the first year that foreign-born admissions to top U.S. grad schools <i>fell</i>. <p> It's almost impossible to know what the opportunity cost would be if substantially fewer immigrants come to the United States, but it's a clear disadvantage when it comes to entrepreneurship. One-quarter of successful Silicon Valley companies were started by immigrants. If the United States hadn't been the land of opportunity, we wouldn't have Intel, PayPal, Google, Yahoo!, or a host of other industry giants, and that doesn't include the thousands of immigrants who fuel the management ranks and research-and-development (R&D) corps throughout the technology industry. <p> The final advantage is the hardest to quantify: These emerging markets and their entrepreneurs have nothing to lose. When a country, industry, or entrepreneur has nothing to lose, it is freed from all the normal restrictions of the way things are usually done. Having nothing to lose gives one the luxury of starting with a clean sheet of paper and far more freedom to take risk—or, as it's called in business circles, a <i>greenfield opportunity</i>. It's the reason South Korea has better broadband than the United States ever will. It's the reason I can get a clear cell phone signal amid pygmy huts in central Africa but not in my living room in San Francisco. It's the reason Japanese cities are connected by futuristic bullet trains that New York and Los Angeles may never have. <p> <i>(Continues...)</i> <p> <p> <!-- copyright notice --> <br></pre> <blockquote><hr noshade size='1'><font size='-2'> Excerpted from <b>Brilliant, Crazy, Cocky</b> by <b>Sarah Lacy</b> Copyright © 2011 by John Wiley & Sons, Ltd. Excerpted by permission of John Wiley & Sons. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.<br>Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.