The 2011 Forbes rich list will undoubtedly be remembered for two things: the stunning rise in wealth to a record $4.5 billion and the arrival of a group of billionaires known as the Facebook six.
That the rich should spring back from the GFC so quickly shouldn’t surprise us. But the way they have been able to increase their wealth – the total has grown by almost a third in just 12 months – is impressive, given the recovering state of the global economy.
The idea that Carlos Slim, Larry Ellison and Bernard Arnault could increase their fortunes by $20.5 billion, $13.5 billion and $11 billion respectively in a single 12 month period says a lot about the ability of markets to bounce back far quicker than real businesses.
The rise of the Facebook six – chief executive Mark Zuckerberg ($13.5 billion), co-founders Eduardo Saverin ($1.6 million) and Dustin Moskovitz ($2.7 million), shareholder and former executive Sean Parker ($1.6 billion) and investors Peter Theil ($1.5 billion) and Yuri Milner ($1 billion) – is equally impressive.
Facebook has become a flagship for this new generation of tech entrepreneurs. No tech company has been valued as highly, grown or quickly or been talked about as much – there were certainly no movies about the founding of Google and Amazon.
But it could be argued that Google is more than just a test case for investment bankers’ ability to value tech companies. What Facebook is trying to do is to create an entire online ecosystem, where users talk to each other, share data, play games, interact with businesses and organisations and, perhaps most importantly of all, buy stuff.
Facebook is just one example of the way the entrepreneurs on the list continue to change the way we live and work.
Perhaps my favourite part of the list so far (I’ve really only started trawling through) is this quote from Forbes editor Luisa Kroll on why rich lists are important.
“Why do we spend so much time counting other people’s money? Because these moguls have the power to shape our world.”
“Telecom billionaire turned Prime Minister Najib Mikati is keeping Lebanon’s government together. Ernesto Bertarelli, who lost the America’s Cup to Larry Ellison last year, is now focusing on saving the oceans from mass extinction. Gates and Buffett have already travelled to three continents working to change giving practices among the ultra-rich.”
“Where their inspiration leads, we will follow.”
With this in mind, let’s take a look at 10 entrepreneurs from the list who we should watch not for the size of their fortunes, but for their ability to shape business, society and events.
Carlos Slim is hardly a household name in Australia, despite the fact he quickly visited here last year as part of a Forbes conference, criticised the NBN and left again. But as well as being the richest person in the world by a margin of $18 billion back to Bill Gates, Slim is a man who will shape the future of Central and South America like few others. In a world where mobile telecommunications are increasingly important, Slim is king – he controls phone and internet companies throughout the Americas, and has a staggering 225 million wireless customers as his telco giant America Movil SAB.
As Kroll points out above, Gates and partner in crime Warren Buffett are on a crusade to change the way the wealthy view and use philanthropy through their Giving Pledge initiative. But Gates is the real key here – after all, Buffett’s philanthropic strategy is to give billions to the charity machine Gates has established, the Bill & Melinda Gates Foundation. Gates corporate, aggressive and innovative organisation has a staggering $36.7 billion in assets – that makes it a powerful force for change, as well as a philanthropic business model that other wealthy entrepreneurs may well follow.
By connecting 500 million people through Facebook, Mark Zuckerberg has already had a huge influence on the way we interact. But despite the sheer size of the Facebook platform, and the vast amount of data it now contains, the network is still in its infancy – we are only starting to get a feel for the way Facebook might change the way we communicate. We’ve seen it already emerge as a key tool for marketers, protesters and even politicians – where it goes next will depend on how the platform evolves. As younger, more connected generations assume greater influence over society, just what impact Zuckerberg has had on society will become clearer.
Brazilian billionaire Eike Batista has repeatedly made the claim that he would overtake Carlos Slim as the world’s richest person. In the last 12 months, his fortune has climbed $3 billion to $30 billion, but he remains well behind the Mexican mogul. But Batista remains a figure to watch. His empire spans mining, shipbuilding, energy, logistics, tourism and entertainment, but his biggest interest is oil and gas company OGX. With a new office in New York and plans to list some of his companies on the London Stock Exchange, Batista is an aggressive, ambitious entrepreneur to watch.
Billionaires love dabbling in politics in America, but Charles and David Koch dabble more than most. In the last 12 months, they have come under intense scrutiny for their large support for the conservative US politicians and more specifically the Tea Party. The brothers, who are worth a combined $44 billion, hold a bi-annual retreat with fellow wealthy Republican supporters to discuss presidential election strategies. With dissatisfaction with President Barack Obama running high, the Koch brothers influence in the next two years could be telling.
It’s been another good year for the Google founders, who rode an 18% increase in Google’s share price to be valued at a combined $38.6 billion. Their search business still controls about two-thirds of the global internet search market, but it is Google’s expansion into mobile technology with its Android operating system that has really expanded the company’s reach. Android is now the world’s most popular mobile operation system – the platform this provides should help further cement Google’s place in the lives of consumers.
Hedge fund manager John Paulson made one of the more spectacular arrivals on the Forbes billionaire list in 2007, when he earned $3.5 billion in one year by shorting stocks related to sub-prime debt. But that was just the start – in 2010, Paulson made $5 billion, which Forbes says is a record for the hedge fund sector. His secret? Gold. More than a third of the $36 billion Paulson manages (his personal fortune is $30 billion) is in gold-related stocks. Paulson, who reckons inflation will hit double digits in the next three-to-five-year, now has the financial firepower to make massive bets on trends – and the smarts to pull them off.
Taking on Google at their own game usually isn’t a recipe for success – except in China, where Google’s problems with local authorities are well documented. Robin Li is the beneficiary of this. He is the founder of Chinese search giant Baidu, which dominates the rapidly growing local market of 457 million interest users. The company’s shares, which are traded in the US, doubled in the last 12 months, helping to make Li the richest man in the country. As China’s internet usage keeps soaring, Baidu should be well placed to ride the wave.
The fortune of Nigerian entrepreneur Aliko Dangote jumped a staggering 557% in the last 12 months to $13.8 billion, making him Africa’s richest person for the first time. The key to this big rise was the listing of his company Dangote Cement, which now accounts for a quarter of the Nigeria Stock Exchange’s total market value. His influence on the development of Africa will be substantial – he is building concrete plants in Zambia, Tanzania, Congo and Ethiopa and cement terminals in Sierra Leone, Ivory Coast and Liberia. Clearly a name to watch.
Poor old Rupert. As Forbes pointed out (with just a hint of glee) Facebook’s Mark Zuckerberg (valued now at $13.5 billion) has surged passed Murdoch, whose fortune is now put at $7.6 billion – no thanks to his dud purchase of MySpace. But Murdoch remains one of the world’s last great media moguls, and he is now almost fully focused on the challenge of figuring out how to make money from the internet. His latest effort is The Daily, an iPad only paper that has launched to limited success. But the entire media sector will be eagerly awaiting his next big move – hoping it works, and hoping they can follow.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
