America’s secret strength is the ability to create and quickly scale corporate enterprises

There is one incontrovertible fact that separates America from all other nations – including Australia. It’s the ability to create and quickly scale up new corporate enterprises.

Eight of the 10 biggest publicly listed companies in America today were founded by private enterprise.

The US is the largest economic and military force in the world today. Its economy, based on gross domestic product, has dominated the planet since the end of the 19th century.

Australia is very much the junior partner in any trade and military co-operation with the US. And yet for all America’s obvious power, its greatest strength isn’t its military force or its economy; it is its ability to accommodate, indeed, to tolerate, criticism about its way of life, including its many flaws and problems. Indeed, when it comes to sniping from afar, the US is justifiably inclined to just shake it off.

Yet there is one incontrovertible fact, a single inconvenient truth, that separates America from all other nations – including Australia – in our time in history. It’s the ability to create and quickly scale up new corporate enterprises. This is America’s secret strength. It is something we Australians can learn from.

Eight of the 10 biggest publicly listed companies in America today were founded not by government, but by private enterprise – often by individual entrepreneurs who created something out of nothing across the half-century from 1975. And by biggest, I mean as measured by market capitalisation, which is the share price multiplied by the number of shares.

Microsoft was founded by Bill Gates in 1975, Apple in 1976, Google in 1988, Amazon in 1994. Elon Musk created Tesla, now one of the most valuable corporations in America, in 2003.

So how does Australia compare with America? Seven of the 10 biggest publicly listed companies in Australia today were founded prior to 1975, including BHP in 1885, Westpac in 1817, CBA in 1911, and CSL in 1916. Our most recent Top-10 corporate creation is the tech company Atlassian, founded in 2002.

It is always tempting in comparisons between Australia and the US to revert to the convenient excuse of scale. America has the ability to scale up its businesses from within the US heartland. “We are so small, it’s so much harder for us,” people tend to say.

What is hard for us, I think, is to accept the fact that we can do better when it comes to cultivating entrepreneurial spirit. Invest in a grassroots culture of entrepreneurship for 250 years, as the Americans have done, and what pops out the other end is a system that can create multiple globally-scaled leading-edge businesses within a 50-year window.

And all the while the Australians are thinking, “We’re doin’ alright here.” Well, are we doing alright? And even if we are, what does the decade ahead hold? Why doesn’t Australia have a globally significant, publicly-listed agribusiness firm, for instance?

At some point over the next 20 years, someone somewhere will begin aggregating renewable energy businesses: solar, wind and hydro; perhaps lithium mines, too. Why shouldn’t that be an Australian, either an entrepreneur or a corporation? Does the “we’re doin’ alright here” mindset deliver the right people, with the right motivation, to create the big new Australian businesses of the future?

There’s a lot to criticise about America. But when it comes to the ability to create new (big) businesses, we Australians have something to learn from our friend and ally, the United States of America.