How to Become a Billionaire

Forbes recently looked at the lives of several ultra-wealthy individuals and came up with this list for how to become a billionaire:

• Their parents had a high aptitude for math.
• They were born in September.
• They were either college drop-outs or went to Yale.
• They worked at Goldman Sachs.

All strikes for me -- no wonder I'm not a billionaire. :-)

Forbes admits, of course, that its findings are very non-scientific. Though they are interesting to review, I doubt that they have any correlation with actually becoming a billionaire. In fact, other than "have a brilliant business idea, do it better than anyone else, and stick with it", there's probably not a whole lot of direction one can get for how to become a billionaire.

Becoming a millionaire, however, is something that's relatively easy to achieve. Simply follow the basics.

Comments

[Paul]

The math makes some sense, I suppose. After all, how can you become a billionaire if your parents couldn't teach you arithmetic (and perhaps teach you to understand statistical trends)? September means these people were the oldest kids in their school grade ... maybe that gave them an advantage in life? As for drop-outs, well the earlier you start a business the more time you have to compound your success, but its a big gamble. Goldman Sachs has billionaire written all over it.

Looks pretty scientific to me. ;)

[David]

All those factors make a lot of sense to me (anecdotally) for the reasons Paul mentions above. The drop-out thing suggests that these billionnaires have a high appetite for risk.

[Dar]

Hmm... I'm good at math and was born in November (today in fact)--guess I'll just have to settle for being a millionaire then... Bummer!

[Old Limey]

The first billionaire that comes to mind never graduated from college but was a very good, self taught computer programmer, but in all likelihood not a great mathematician. He happened to be in the right place, at exactly the right time, with some inside knowlege and contacts that helped him parlay a $50,000 purchase of an operating system called QDOS (Quick and Dirty Operating System) into becoming the richest man in the world with a net worth estimated to be 50 billion dollars.

I'll give you a clue he was co-founder of the most well known software company in the world.

[Crystal]

Happy Birthday Dar!

Hmmm...

1) My mom was okay at math and my step-dad loves it.
2) I was born in December.
3) I did not go to Yale.
4) I have no aspirations to work at Goldman Sachs.

Oh well...

[billyjobob]

@ Old Limey The Bill Gates story is a very interesting one. The thing that puzzles me is where did him and Paul come up with that 50K to buy the system. When I was his age( when he started Microsoft) Money was very tight. I had to sell my Fender Telecaster for a lousy 100 bucks because I was going to school and figured I needed the money more that I needed that cool guitar. I still kick myself for selling that.

[Eugene Krabs]

Billyjobob, I'm not Old Limey, but if memory serves, the money was supposedly from IBM, who granted Bill Gates some "seed money" to further develop this new DOS that he was pitching (since the CP/M deal apparently fell through).

Suffice to say, Bill played a wild and dangerous game of corporate poker, bluffing IBM about their DOS development even though they had no such thing at the time, and then buying QDOS without ever revealing the larger IBM deal.

That is, assuming I have my facts straight. :D

As for the original news story, I would love to see how many people who fit all or most of the items on the checklist, and may not have become billionaires? It's always fun to see who "made it" and perhaps trying to find a pattern as to how they made it, but that doesn't always seem to be the case.

I don't have the link hand (sorry), but I remember reading an article on several case studies of high IQ people who have gone to Ivy League schools. Obviously, people like that are deemed most likely to succeed and ascend to positions of great importance later on in life. As they traced their lives, some have indeed ascended, while many others did not. Most remained extremely intelligent, but some a few become librarians, postal workers, and even a gardener.

Perhaps money isn't everything, or perhaps there's more to it than IQ and a nice diploma.

[billyjobob]

Thanks Eugene.... can you imagine the guy that sold the QDOS system to Bill gates. To think of how he lost out. He probably kicks himself more for selling that than I do over my guitar sale. :) ...hopefully he is at least rich and happy somewhere today.

[Eugene Krabs]

You know, believe it or not, but I actually have thought about that many a times. (Yes, I have no life. :D)

The truth is, he probably thought it was a fantastic deal, and it was. Remember, he really made the QDOS more as a pet project, because CP/M was already well-established at that point, and he was only made a Quick and Dirty version of it for his own use. In fact, he only spent a month or two tinkering with it.

Imagine if we did something for fun only for a month or two, and then somebody out of the blue decided to buy it from us for $50k? Would you be excited too? I would be. Now imagine that with the value of the dollar from back then!

Again, Bill Gates took a massive risk on the IBM deal by cooking up this fantastical DOS he supposedly had but didn't, and then managed to find QDOS hiding somewhere, and not only be able to buy it, but because it was based on CP/M, and even dodged later legal copyright infringement because it was based on CP/M, it was determined to be different enough that no copyright violations took place.

I don't think even Bill Gates would have known how handsomely this gamble would have paid off....

As for the guy who wrote QDOS, I think he was eventually picked up by Microsoft as an OS developer, so $50k bonus and a sweet job? Can't complain!

[Eugene Krabs]

I am so sorry about my typos. Will try to proofread next time.

[Old Limey]

There's another billionaire in Silicon Valley that most people hate, and that's Larry Ellison, the CEO of Oracle.

First he insisted on violating the rules at San Jose Airport by flying his private jet in during the nightime hours when it wasn't allowed. It's hard to fine a guy like that for breaking the rules. Anyway he finally got the rules changed to allow his plane because it made less noise than the big jets.
He is a ruthless entrepreneur that loves hostile takeovers and not your nice, quiet family man like Bill Gates but has a history of arrogant & reckless behavior and by all accounts is on his 4th. wife.

His old house was put on the market at $25M, the new one, a Japanese Country Home on 23 acres in Woodside, CA has an assessed value of $79M, the workers came over from Japan to do the very specialized construction. The gardens are supposedly fabulous, as is the huge Koi pond and waterfall.

He races in the America's Cup and also has a huge private yacht moored near Oakland, CA.
I haven't read anything about his charitable deeds but I'm sure they aren't in the same league as those of Bill Gates.

The two Silicon Valley billionaires (now deceased) that are loved and admired by all were William Hewlett and David Packard, they have done tremendous things in the area from the Lucille Packard Children's Hospital at Stanford, to the Monterey Bay Aquarium, and the acquisition of thousands of acres of land for parks and open space preserves. Also the way they treated their employees is what legends are made of. Personally if you are a billionaire, since you can't take it with you, why not be generous. Another generous billionaire of old was Andrew Carnegie, the second richest American, he sold Carnegie Steel to J.P. Morgan who turned it into U.S Steel, then kept enough to retire in a castle in Scotland and gave away the rest through his foundation which built 3000 libraries in 47 states, and universities all over the USA.

[Eugene Krabs]

Thank you for sharing that, Old Limey. I don't know the backgrounds of a lot of these other tech billionaires, so it's quite interesting to me.

I hope I didn't make Bill Gates out to be a bad guy. True, his business tactics were cut throat, but in the end, he really isn't a bad guy. Today, he seems to be mostly interested in his foundation, and they have smart people working on some pretty smart goals.

I would say that the one thing that probably helped him become a billionaire was the fact that he was not afraid to take on a massive amount of risk when he was younger.

I suppose when you think about it, you could say the same about the Rothchilds as well. The father, who I think was a war profiteer no less, expanded their financial business by literally making their sons stay in foreign countries to set up branches.

Likewise, Rockerfeller (America's richest man when adjusted for inflation) commonly practiced cut throat, monopolistic practices that, today, would have never been legally possible.

All were very good at what they did. All worked very hard for their business. All cut throat. All took massive amounts of risk. And it worked out for them.

Of course, what we don't tend to chronicle are people who fit the same profiles as these billionaires, perhaps even took the same gambles, but for whatever reason, did not succeeded. After all, a path that involves high risk would certainly have their share of casualties.

Personally though, I don't have that DNA. Even with my occasionally risky stock trading, it still doesn't come anywhere close to what these billionaires have done. But that's OK. I also have no aspirations to be a billionaire anyways. Just millionaire will be fine. :D

[Andy]

My dad was an engineer, my mom went to school for accounting.
I was born in September.

That takes care of the two criteria that were out of my control. Too bad this study didn't come out a few years ago. Instead of dropping out of college, I suffered through it while working full time. It figures that I would screw up the easiest one of the list. I guess there's no point in applying at GS now.

[john78]

Wake up.

The reality behind what's being said here is that billionaires either inherit wealth or make their own through social networks and/or questionable means. Doing so has nothing to do with DNA and little to do with hard work.

As for going to Yale, it's called a "social network." Scratch my back, make a phone call, and I'll scratch yours. Nothing to do with hard work or merits.

As for Goldman Sachs, we've all done our part to make them richer with the tax-financed bailouts. The lesson then is if you really want to be a billionaire, run your business in the ground and then lobby politicians to use tax money taken from the paychecks of middle class wage workers who dream of wealth to keep yourself in business. Then give yourself a bonus for your "hard work."

As for the person who said Bill Gates took on massive risk... Did we forget that Bill Gates' parents were millionaires many times over before he even left the womb? It's easy to take a gamble when you can fall back onto millions of dollars so let's not paint the guy as some dude who "had a dream in his garage." Far from it

I know we all aspire to greater wealth on this site but let's not lie to ourselves about what we're seeing here. It's not just about working hard and "making it."

[Old Limey]

Coincidentally with this topic about billionaires I watched a great program on PBS last night it was Charlie Rose interviewing Warren Buffet, the second wealthiest man in the USA. He would be the wealthiest if he hadn't given billions to charity. Warren Buffet is probably the most humble billionaire in existence. He still lives in the same 5 bedroom stucco house in Omaha that he purchased in 1957 for $31,500. He wasn't a great inventor and didn't build a huge corporation from scratch, his talent was recognizing a good business deal when he saw it, and acting swiftly. Buffet admitted very candidly that as good as he was at buying companies and putting deals together he lacks most other skills.

Buffet made me realize that it isn't the dealmakers and the sharp and greedy traders at Goldman Sachs that should be most admired. Just think about the individuals that have made a tremendous impact upon the lifestyle that we all take for granted. Where would we be without people like Thomas Edison, Alexander Graham Bell, Henry Ford, the Wright Brothers, Marconi, Alexander Fleming (discoverer of penicillin), Louis Pasteur, Jonas Salk, and the inventors of the microchip, computer, internet, television, internal combustion engine, anesthesia, MRI and X-Ray machines, and all of the other things that have improved the quality of our lives over the last 150 years. These days in this materialistic society we tend to worship money too much rather than individual skills and the people with great foresight that worked hard, often without great financial rewards, to make this a better world.

How about the skills that the pioneers possessed when they overcame tremendous obstacles to bring their families out West, to homestead and farm and succeed, but not get rich, against tremendous odds. Warren Buffet readily admitted he wouldn't have been any use as as a pioneer in the new frontier.

[Mike Hunt]

I wasn't born in September, never worked at Goldman, finished college and my parents are good enough at Math.

I will stive to be the first billionaire who is a regular FMF reader and commenter.

Unfortunately by the time I achieve it there will likely be well more than 600 billionaires in the world....

-Mike

[Dr. Artfredo C. Abella-Baguio City-La trinidad, BenguetPhilippines/U.S.A]

Here are the things that can make you become a billionaire:1) Have a passion for what you are doing, be it a business, investment or real estate venture. 2) You must have persistence in what you do. 3) You must firmly believe in your zodiac signs. 4) You must have a vision, let us say of unifying all religions in the world, merging all religions based on love because love is God. There will no longer be discrimination whether you are a Christian,Islam, Protestant or Pagan. All religious denominations will be welcome in your religion called the Universal Believer. 5) You must be able to make people meet their needs and attain their ambitions in life at the least cost.6) You must love people and use money and never do the other way around. 7) You must be able to dream about the business that you intend to create and even go to the extent of dreaming about the huge amount of money you are about to earn. 8) You must love money, love is the purest sense of emotions and virtues but never to lust for it. 9) You must be a visionary, anticipating a decade ahead of the economic needs of your community and the world ,and fill and solve it and 10) You must never lose money - it means never wasting money without a return of investment.

[Guerrilla Billionaire]

This Yahoo article is not very helpful. Self-made billionaires come in all types. The ones I have followed don't fit the above profile. Kirk Kerkorian, Ted Turner. Carlos Slim. Sheldon Adelson. The secret to their success is serial deal-making. They buy, improve, and sell assets continuously. In most cases, these are businesses. With them it's all about systems rather than great ideas. The yahoo piece focus too narrowly on current technology tycoons. There are other ways to make money.

[Guerrilla Billionaire]

Sorry Doc, but astrology is completely bogus.

[Erick Canino]

Look dude, I'll confess, i'm a 14 year-old but if I have leaned anything from my parents its that if you want to become something you're not you have to do 2 things: believe in it and work hard on it, if you dont, then I dont know what might be in your future, but if anyone is hearing me now then I better hope you listen because this is the actuall truth, ok just follow your dreams, believe in it and work on it.