Friday, August 14, 2009

Rags to Riches to Rags: Sometimes

My dad once told me that the 'rags to riches' story often was 'rags to riches to rags' in three generations. It's not a universal rule, but the pattern exists.

The founder is born poor, but has energy, ambition, and a really good idea. A few decades later, the founder's children start taking over the business. Let's say it's one child.

The kid's smart enough: but doesn't have the founder's spark. The second generation keeps the business running, though. Or, is sharp enough to live on the interest of investments.

The third generation comes along. This wunderkind grew up surrounded by wealth, and has bold, innovative ideas.

Which turn out to be innovatively suicidal, when applied to the founder's business.

Or, the founder's grandchild isn't all that interested in the business, but enjoys spending money on things like sports cars and skiing in Vail: and spends two generation's accumulation of wealth.

There are many exceptions, of course.

Like the Adams family: the real one, starting with Samuel Adams, who helped stir up the American revolution and was Governor of Massachusetts for a while. Two centuries later, Charles Francis Adams IV was Raytheon's first president.

They're not as famous as the Adams, but Loonfoot Falls has the Baums. The family is into its seventh generation now, and most of Zachariah Baum's descendants have done pretty well. I've mentioned Elton Baum's efforts with Haskell's Corner Drug, and the I Love Fruit! stand. Next week, I plan to tell about Baum Media Productions.

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