Jeff Bezos and More: In Defense of the Value of Valedictorians

Jeff Bezos is one of the most successful valedictorians in American history.
Jeff Bezos is one of the most successful valedictorians in American history.

Source: Steve Jurvetson – Flickr: Bezos’ Iconic Laugh, CC BY 2.0

Jeff Bezos is known as the founder and CEO of Amazon.com (AMZN). The stock for his company is toying with the $1000 level for the first time ever and is close to pushing Bezos past Bill Gates as the world’s richest man.

Amazon.com (AMZN) trades near an all-time high as it flirts with a historic $1000 level.
Amazon.com (AMZN) trades near an all-time high as it flirts with a historic $1000 level.

Source: FreeStockCharts.com

As of May 25, 2017, Bezos had an estimated $82.8B net worth. Bezos also graduated from Miami Palmetto High School as his class’s valedictorian. You would never believe this combination of information after reading headlines like this recent one from CNBC: “This is why class valedictorians don’t become millionaires.”

In this article, CNBC interviewed Eric Barker, author of the recently released book “Barking Up the Wrong Tree: The Surprising Science Behind Why Everything You Know About Success Is (Mostly) Wrong.” Barker made the following strong claim:

“[Valedictorians] do well…but they don’t actually become billionaires or the people who change the world.”

Given the fame, fortune, and impact of Bezos, I wondered how could Barker make such a strident claim with no qualification and how the claim could be accepted with no critical review (CNBC was far from alone). I decided to do a quick internet search. In the top results, I discovered several sites which list famous, impactful, and even very rich people who were the valedictorians of their respective high school classes. I provide the list, edited by own cross-referencing, at the end of this post. This list is far from comprehensive. Given the readily available information, I have to assume that Barker started with a theory or hypothesis and focused on confirming data. It seems he mainly relied on the work of one researcher from Boston College, Karen Arnold. Again from the CNBC article:

“[Barker’s] assessments are based on research by Karen Arnold, a professor at Boston College and the author of ‘Lives of Promise: What Becomes of High School Valedictorians: A Fourteen-year Study of Achievement and Life Choices.’ She tracked 81 high school valedictorians and salutatorians after graduation…

…’Valedictorians aren’t likely to be the future’s visionaries,’ says Arnold. ‘They typically settle into the system instead of shaking it up.'”

I put aside the technicality that Arnold included salutatorians in her study and not just valedictorians. Instead, I was left unclear about the implicit relationship Barker drew between “billionaire” and “visionary” when Arnold did not appear to do so in her research. As far as I can tell from some references to Arnold’s 1995 book which followed graduates from the class of 1981, Arnold did not create monetary quantifications of success. However, I can definitely understand why someone with a money-based view of success would make the connection. Indeed, the hurdle Barker offers up as a definition of success is extremely high. The CNBC article produced this related quote from Barker’s book:

“There was little debate that high school success predicted college success. Nearly 90 percent are now in professional careers with 40 percent in the highest tier jobs. They are reliable, consistent and well-adjusted, and by all measures the majority have good lives.

But how many of these number-one high school performers go on to change the world, run the world or impress the world?

The answer seems to be clear: zero.”

Zero impact. Nada. Not Jeff Bezos. Not Conan O’Brien. Not Sonia Sotomayor. Not W.E.B. Du Bois. And do not dare include General Douglas MacArthur. (See the end of this post for descriptions of these and other notable high school valedictorians).

Barker’s mistake was not just an over-reliance on a single, very old study. Barker also over-extrapolates and fails to consider the frame of reference for these strong claims that box valedictorians into a corner of inconsequence. (Ironically enough, Bezos seems to have graduated in 1982, one year after Arnold kicked off her study). Arnold’s sample is extremely small; the sample is too small to reliably test for the kinds of rarefied achievers that Barker highlights.

First of all, there are currently at least 22,000 high schools in the U.S. My estimate comes from the number of high schools referenced by the rankings of the U.S. News and World Report. So the U.S. presumably produces at least 22,000 valedictorians a year. For the sake of argument, I will reduce that number to 20,000 valedictorians in 1981. Arnold’s research subjects are 0.4% of the population for a given year and with each passing year, the numbers of valedictorians quickly overwhelm her longitudinal snapshot. If Arnold’s research were a survey, her results would include a whopping (minimum) margin of error of 11% for the class of 1981 assuming her sample was randomly selected (without bias). In other words, if the conclusion from this one study is that 0% of valedictorians grow up to be “world changers”, we could assume that repeating this study multiple times would generate observations of roughly as many as 11% (or 9) valedictorians of consequence in each trial.

Quantifying “world changing” is not easy, so it makes sense that Barker used the short-hand of billionaires. Yet, billionaires are like needles in a haystack. There are so few billionaires that in 2016, Forbes was easily able to list all 540 of them…and this is across DECADES of high school classes, not just one. I would love for someone to categorize this list by academic achievements and class years. Anyway, according to the Census Bureau estimate for 2016, the adult population of the U.S. was about 249,485,228. So the rate of billionaires in the adult population in general is 0.0002%. Using a sample size calculator, I find that I need 1,920,726 adults to conclude that my study group produces zero billionaires with 95% confidence.

The hurdle for millionaires matches Arnold’s sample. CNBC reported earlier this year that there are 10.8M millionaires in the U.S. That amount produces an incidence rate of 4.3% in the adult population (for the sake of simplicity, I am assuming all these millionaires are adults). The sample size calculator produces a study group size of 85. Yet, the only mentions of millionaires in the CNBC article are in the title and in a reference to a different study. I quote Barker’s use of this study from an article Barker wrote in Time’s Money to promote the book with the hyperbolic title “Wondering What Happened to Your Class Valedictorian? Not Much, Research Shows“:

“School has clear rules. Life often doesn’t. When there’s no clear path to follow, academic high achievers break down. Shawn Achor’s research at Harvard shows that college grades aren’t any more predictive of subsequent life success than rolling dice. A study of over seven hundred American millionaires showed their average college GPA was 2.9.”

Barker again produced surprisingly strong conclusions based on a single result. Yet, this single result, a GPA of 2.9, is actually pretty good: just a small fraction below a B grade. Assuming that 2.0, a C grade, is average, this study showed that millionaires are above average academic achievers in college (putting aside grade inflation!), hardly a roll of the dice. I am willing to bet that the top academicians are partially responsible for pushing that study’s results above a 2.0 average.

A quick internet search helped me turn up another study of millionaires and their academic achievement. In 2016, Bloomberg reported on the work of economists at the Federal Reserve Bank of St. Louis who used data from the Federal Reserve’s Survey of Consumer Finances for 2010 and 2013:

“According to the sample, a black person’s odds of being a millionaire increase from less than 1 percent if he or she doesn’t complete high school to 6.7 percent with a graduate degree. White Americans without a high school diploma start out with slightly better chances—1.7 percent—that rapidly improve with more school: A graduate-level education increases their probability of amassing a net worth greater than $1 million to 37 percent.”

These differences are significant. Since it typically takes above average academic performance to get admitted to graduate school, THESE results seem to suggest that academic performance in college does matter in one’s drive to millionaire status. However, academics are obviously not the ONLY path to success.

The fact that there are multiple paths to success and riches tripped up “Rich Dad Poor Dad” author Robert Kiyosaki when he leveraged Arnold’s results to come to even stronger conclusions about success than Barker did. Back in 2013, Kiyosaki really slammed valedictorians when he wrote “Why Valedictorians Fail“:

“Professor Arnold discovered that, ‘while these students had the attributes to ensure school success, these characteristics did not necessarily translate into real-world success…. To know that a person is a valedictorian is only to know that he or she is exceedingly good at achievement as measured by grades. It tells you nothing about how they react to the vicissitudes of life.’

Translation: real life is not measured by grades but by your bank statement—and they don’t teach that in school.”

Kiyosaki has an even clearer money-based definition of success than Barker; if you are not rich, you have failed in life. Kiyosaki also slams valedictorians for being too timid: “Valedictorians don’t make good entrepreneurs and investors because they’re afraid of risk. They make great employees.” Poor Bezos!

Kiyosaki’s effort to portray valedictorians as failures buries the valuable message of resilience, boldness, and adaptability.

“The message is simple: Success in the classroom does not ensure success in the real world. The world of the future belongs to those who can embrace change, see the future and anticipate its needs, and respond to new opportunities and challenges with creativity and agility and passion.”

I would respond that academic success also does not exclude you from being the kind of wealthy success that Kiyosaki elevates. The list of valedictorians at the end of this post validate my claim.

After all this belittling of academic brilliance, I found humorous irony in a piece that featured Arnold defending the distinction of valedictorian as a way to honor academic achievement (emphasis mine):

“…being valedictorian is the one academic honor that does matter to students. We understand that athletes and performers merit special honors because their achievements represent hard work, focus, and motivation. So why shy away from awarding honors to students who succeed in academics?

…In 1995, I co-authored a book on what becomes of valedictorians later in life. We studied 17 years of data and determined that valedictorians become hardworking, productive adults whose educational and career achievements remain outstanding.”

Arnold is clearly not one to devalue valedictorians in the ways that Barker and Kiyosaki do. I daresay that Arnold’s main point was to build character profiles of top academic achievers and not to establish a hard and fixed ceiling of life achievement for these people. I further claim that using research in isolation, without considering a full context of data and analysis, and/or failing to review multiple possibilities leaves us vulnerable to confirmation bias and weakens our ability to lean against counter-arguments.

So overall, I say “GO!” to all of you star academicians who wish to walk in the footsteps of Bezos and so many other extremely successful people!

A LIST OF FAMOUS HIGH SCHOOL VALEDICTORIANS – a healthy mix of successful, impactful, non-conformist, and even wealthy academic achievers

(List compiled from ranker.com and Newsday with cross-checking from Wikipedia and Biography.com. High school names and graduation years were not available for all personalities.)

  • Jeff Bezos: founder, CEO, and Chairman of Amazon.com – Miami Palmetto High School, 1982 (?).
  • Douglas MacArthur – general known for World War II battles: West Texas Military Academy.
  • W.E.B. Du Bois – sociologist, historian, civil rights activist, Pan-Africanist, author, writer and editor, first African-American to earn a Ph.D. from Harvard: “an all-White high school in Massachusetts” late 19th century.
  • Sonia Sotomayor – U.S. Supreme Court Justice: Cardinal Spellman High School in the Bronx, 1972.
  • Coretta Scott King – civil rights activist (wife of civil rights leader Martin Luther King, Jr.): Lincoln Normal School, 1945.
  • Conan O’Brien – comedian, last night talk show host: Brookline High School, 1981.
  • Weird Al Yankovic – music artist specializing in parodies: Lynwood High School.
  • Kevin Spacey – actor: Chatsworth High School in Chatsworth, California, 1977 (co-valedictorian).
  • Mare Winningham – actress: Chatsworth High School in Chatsworth, California, 1977 (co-valedictorian).
  • Cole Porter – music composer: Worcester Academy in Massachusetts, early 20th century.
  • Jodie Foster – actress: the Lycée Français de Los Angeles, a French-language prep school, 1980.
  • David Duchovny – actor (made famous by the X-Files): the Collegiate School in Manhattan.
  • Chevy Chase – comedian, actor: Stockbridge School.
  • Cindy Crawford – model: DeKalb High School, 1984.
  • Bette Midler – actress, singer: Radford High School.
  • Alicia Keys – singer: Professional Performing Arts School.
  • Johnny Bench – major league baseball player: Binger-Oney High School in Binger, Oklahoma
  • Tiffani Thiessen – actress: Valley Professional High School in Studio City, Los Angeles, 1992.
  • Emmylou Harris – singer and musician: Gar-Field Senior High School.
  • Harry Anderson – actor: Buena Park High School then North Hollywood High School, 1970.
  • William Peter Blatty – author (wrote the Exorcist): Brooklyn Preparatory, a Jesuit school, 1946.
  • Troian Bellisario – actress: Campbell Hall School in North Hollywood, California.

{Addendum: title changed and small corrections made on June 5, 2017}

Dan Siroker’s Five Keys to Successful Data Analysis

Dan Siroker, former Director of Analytics for the Obama Presidential Campaign, was a keynote speaker at SoCon10. SoCon is an annual conference run by the Center for Sustainable Journalism at Kennesaw State University in the Atlanta, GA area. This year’s theme was “Proven Social Media, Social Network Tactics to Enrich Your Business, Nonprofit and Yourself.”

Siroker described how his team used the power of data analysis to raise an extra $44M or so for the Obama presidential campaign. Here are his five keys to success in getting actionable and profitable results using data analysis:

  1. Define quantifiable success metrics. For Siroker, these were donations and votes.
  2. Question assumptions.
  3. Divide and conquer (segmentation of data).
  4. Take advantage of circumstances – be prepared to leverage unplanned events.
  5. Always be optimizing – continual improvement.

Siroker’s results speak for themselves!

Dan Siroker – Director of Analytics, Obama Presidential Campaign – Keynote Speaker at SoCon 10

FYI – Dan Siroker, Director of Analytics, Obama Presidential Campaign, will be a keynote speaker at SoCon 10, January 29-30, 2010.

SoCon is a conference on Social Media and Social Networking held in the Atlanta area every year since 2007. I attended in 2008, and I highly recommend it for anyone interested in this space.

Here is how SoCon describes this year’s conference:

“In the first three years, we introduced social media, user-generated content, blogs, podcasts, video logs, social networking, wikis, Twitter… but nothing stands still. Find out what you have to know in 2010 to stay ahead of the learning curve. Find out who is doing great stuff; who has great, innovative ideas. Network and learn — and maybe even partner with — independent content producers, new media pros, academics and people from across the spectrum of marketing, public relations, legal, human resources, and executive ranks.”

Georgia’s Schools Struggle with Data Analysis But Your Business Need Not Suffer Too

The Atlanta Journal-Constitution reported on September 26, 2009 that “despite more than a decade of effort and millions of dollars, Georgia’s system for tracking the progress of public school students remains deeply flawed.” The article describes a very tortured and wasteful process that has yet to yield any meaningful analysis or change in Georgia’s public schools. Georgia’s experience contains many lessons applicable to any business that can use data analysis to improve business performance:

  1. Maintain consistent leadership over projects implementing tools for data analysis. It is all too easy to continue to rely on the gut instincts and subjective assessments of the past. Strong leadership is required to break down old habits, evangelize the benefits of sustainable, data-driven approaches to running the business, and even challenge special interests who do not want mistakes revealed by evidence and facts.
  2. Do not leave staff to wallow in the misery of collecting and managing data. Their time and effort is very valuable, and it is better spent analyzing the data and developing recommendations from it.
  3. Build analytic systems that track changes over time and place. This is the only way to monitor performance and to develop benchmarks that serve as the basis for improvement.
  4. Integrate systems across groups and divisions as much as possible. This leverages effort and creates larger potential for creating strategies that are optimal for the entire business and not just specific entities.
  5. Carefully assess the make vs buy decision. If the company lacks the skills and/or the will to see an implementation through to its successful conclusion, then hire a firm that demonstrates those capabilities AND can train staff to maintain and use the system for the foreseeable future. Make honest assessments about whether or not the company truly has the resources to hire the correct staff and buy the correct hardware for making an analytic system work. Understanding the return-on-investment (ROI) of making data-driven decisions will help focus make vs buy decisions.

Follow these steps, and your business will be well on its way to executing data-driven strategies for improving business performance.

The growing importance of statisticians and their craft

The NYT describes the growing importance of statisticians to solving more and more of our social and business issues. The article makes clear the rapidly increasing importance of statistics, especially in making sense of the immense amounts of data we can now collect, track, and store: “The new breed of statisticians…use powerful computers and sophisticated mathematical models to hunt for meaningful patterns and insights in vast troves of data.” The author tells the poignant story of a woman trained in anthropology and archaeology who went on to get a Ph.D. in statistics because of her interest in doing data analysis for her work.

In my graduate department at Stanford University (Engineering-Economic Systems at the time, now named Management Science and Engineering), we had a saying: “Mathematical Modeling for Human Solutions.” We took pride in taking the tools and techniques of math and statistics to solve practical problems. The article correctly points out “though at the fore, statisticians are only a small part of an army of experts using modern statistical techniques for data analysis. Computing and numerical skills, experts say, matter far more than degrees. So the new data sleuths come from backgrounds like economics, computer science and mathematics.”

I was particularly encouraged to read that Peter Orszag, Director of the Federal Office of Management and Budget, has a keen interest in using statistics to drive sound policy.

In other words, if you are not taking advantage of data analysis to address some of your most vexing problems, you are probably going to get left behind!

No data = no impact

On Monday, the Atlanta-Journal Constitution reported that the state of Georgia is considering scrapping its annual sales tax holiday due to budget issues. One legislator expressed his support for the program by claiming: “‘It’s one of those things that spurs people to spend money that they may not otherwise spend. It goes directly to citizens and helps local businesses.'” Right after this quote, we learn, unfortunately, that “…Neither the state nor the Georgia Retail Association have a way to track results of the sales tax holiday.” In other words, lacking data, we could make an claim equally valid to the politician’s that all a tax holiday does is drain the state budget since consumers will simply plan their shopping around the given event.

Without data, we can have no impact. How can anyone really know whether or not a tax holiday not only works or is even worth its cost to the state budget? Certainly, everyone enjoys tax-free shopping, but the cost may outweigh the benefits if, for example, the state is not able to fund other important projects or increases taxes somewhere else to make up for the revenue gap.

These lessons apply in business as well as government. Without data to measure performance, business plans and strategies are subject to the whims of “gut instinct” or personal biases and subjectivity. One person’s success can easily be another person’s failure and power relationships may win the day instead of what actually improves profits.

How could the state of Georgia attack this problem? The first step is the collection of the retail data. This data needs to be daily so seasonal and cyclical patterns can be accounted for. The second step is to consider controlled experiments. For example, run the state holiday on different dates in different counties, skip a year, or change the dates around from year-to-year. In other words, establish a set of data than can be used as the control for comparison of performance. If the quantity of data or the number of stores present large obstacles, establish the data points for select stores that have an established record of sales in the local community. At this level, every effort should be made to track the specific items that consumers purchase as well.

I strongly suspect that if the state of Georgia applied some simple analysis to this program, the results will surprise them!