Although it’s a popular story, it is untrue that President George W. Bush once said, “The problem with the French is that they have no word for entrepreneur.” Still, a common prejudice in Anglophone nations holds that the French are less entrepreneurial than we. Creative Capital: Georges Doriot and the Birth of Venture Capital–a biography of the French-born Harvard Business School professor who practically created modern venture capitalism–is a reproach to that assumption.
That said, as BusinessWeek’s Spencer Ante makes clear in his new book, Georges Doriot was an unusual Frenchman. He studied the sciences at his Parisian lycée, to which–after gaining his license at 15–he drove through the boulevards of a capital by then hunkered down for World War I. At 18 he passed from that lycée to the charnel house of the Western Front as an officer in an artillery regiment; at war’s end heeded his father’s counsel that the shattered state of France made the New World his wisest option.
So Georges Doriot came to the United States at 21 with neither family nor friends, nor much money, but with the intention to enroll at MIT and with a letter from a friend of his father introducing him to A. Lawrence Lowell, president of Harvard. At Lowell’s suggestion he studied at Harvard Business School rather than MIT, and in his first job at an investment bank he befriended a young Lewis Strauss, who would later be the chairman of the U.S. Atomic Energy Commission and a dispenser of federal benifices on an enormous scale. Even in Doriot’s earliest years in America, then, its future eminent men were familiar to him–though still strangers to most of their countrymen–and this pattern intensified after Harvard Business School hired him in 1925: his former students frequently attained high positions in business or government. During World War II, having become a U.S. citizen, Doriot joined the army, became director of the Military Planning Division, and received brigadier general’s rank in the Quartermaster Corps after William Donovan, soon to be head of the OSS (forerunner of the CIA), recommended him to President Roosevelt. His military superior in the war was a man who in the 1920s had attended his lectures on the virtues of the goal-oriented campaign and the collective wisdom of the markets.
On that latter subject Doriot felt strongly. In speeches and articles, he opposed both the dirigiste political economy of his native France and the tax hikes and anticompetitive laws enacted in the United States under the New Deal. Such regulations, he maintained, arrogated to bureaucrats the function of the markets; their worst feature was that they let government lend money to failing businesses. Ante notes that a former colleague of Doriot’s, James F. Morgan, recalled him as “the most schizophrenic Frenchman I’ve ever met”–devoted to his original land’s wine, cuisine, and language even as “the French capacity to make very simple things complicated drove him nuts.” However atypical a Frenchman Doriot was, his pro-entrepreneurial philosophy–alongside his vast experience serving on dozens of corporate boards in the interwar years and running much of U.S. military procurement during World War II–made him the natural choice for the role of company president when in 1946 a group of Boston’s leading citizens set up the American Research and Development Corporation (ARD) as the first publicly owned venture capital firm.