The Billionaires Series is a series of articles that analyzes and explains how billionaires built their companies and became…billionaires.
I wrote this series because I wanted to find out if there were some common principles to becoming a billionaire. I wanted to know if there was a formula.
After writing the entire series, I sat down and took note of all the things that all billionaires did.
I found they all practiced and respected 10 principles that enabled them to grow their business to the extent that they did.
Here they are.
Before we start, please know that all of the billionaires I selected came from different countries, worked in different industries, and made their fortune from scratch. Many of them lived in extreme poverty as children.
No excuses.
1. Billionaires Want to Make an Impact or Solve a Problem
2. Billionaires Enjoy the Work and the Industry
3. Billionaires Are Not After the Money
4. Billionaires Understand It Takes Time
5. Billionaires Have a Lot of Energy, Work Hard, and Fight Until They Die
6. Billionaires Are Learning Sponges
8. Billionaires Innovate AF and Think for Themselves
9. Billionaires Never Stop Growing
10. Billionaires’ Companies Excel in at Least One Thing
Mindset
1. Billionaires Want to Make an Impact or Solve a Problem
Except for a few exceptions such as Charlie Munger or Sam Bankman-Fried (SBF), billionaires never wanted to make money at first (and even then, SBF wants to give it all).
They wanted to make a huge impact, or solve a huge problem.
Tatyana Bakalchuck wanted to give women the opportunity to buy clothes online.
Peter Gilgan wanted to build houses.
Hamdi Ulukaya wanted to make the best yogurt in America.
Yoshiko Shinohara wanted to help women get good job opportunities.
And Torstein Hagen wanted to offer the perfect cruises.
None of these people started with money as their initial intent.
They wanted to make an impact, or solve a problem.
It was by making this impact that they became rich.
The first thing I learned with this series is that becoming rich is a consequence, not a motive.
You become rich as a result of the value you deliver, not as a result of…your desire to become rich.
To become rich, you have to be selfless. You have to solve a problem for someone else and do it as well as you can so that customers give you their money.
You need to forget about yourself and focus on others. You need to satisfy them as much as you can.
Only then will the money flow to your pocket.
Billionaires didn’t work as means to make money. They saw money as means to achieve work.
2. Billionaires Enjoy the Work and the Industry
The book The Millionaire Fastlane by MJ DeMarco changed my life. However, the author made a big mistake.
MJ explained that in order to get rich, one should give up their passion and “do what they hate”. He means by that that you must selflessly solve a problem that someone else has, and that this process is supposed to be hard and not enjoyable.
It’s easy to see where MJ is coming from.
While all successful people always say “follow your passion”, how many ended up making it by following their passion?
A quick look at all the struggling artists and sports players is enough to get an answer: not many.
So MJ’s anti-passion message resonated with me. It seemed to fit reality.
I wrote the billionaire series thinking I’d find the same pattern in billionaires.
I did not.
All billionaires enjoy what they are doing.
Whether it is passion or meaning, they didn’t choose their industry randomly (except for Guillaume Pousaz, but he eventually became passionate).
They chose the industry or problem because it was meaningful to them, or because they were passionate about it.
So, why would MJ say “do what you hate” when billionaires do what they love?
If you read his book, you find out that it is because MJ has never been passionate. MJ wanted to be rich. MJ wanted to retire. He didn’t want to solve a problem.
This is the key difference between millionaires and billionaires.
Millionaires are in it for the money. Once they have enough, they stop and retire.
Billionaires are in it for the impact. They wouldn’t retire even if they had €100 billion. And they would likely work for free as well.
Ironically, billionaires taught me that doing something you enjoy for €10k/month is much better than doing something you hate for €100k/month.
And that is because…
3. Billionaires Are Not After the Money
Billionaires make a lot of money because they don’t care about the money.
They are not spending it, so it accumulates. They’re not running after it, so people gladly pay them.
Companies that switch from being customer-centric to money-centric often lose customers very quickly and die.
When you are business-centric, you focus on what you can give.
When you focus on money, you focus on what you can take. Obviously, your customers will react better to one than to the other.
The first step in becoming a billionaire therefore, is to forget about becoming a billionaire.
Or, if you do it for the money, you need to want to give it all to other people.
So forget about the money. Focus on making an impact. Focus on solving a problem.
4. Billionaires Understand It Takes Time
Patience is one of billionaires’ strongest assets.
Consider this:
Yoshiko Shinohara worked on her business for five years before being able to afford an office.
Daniel Dines worked for 10 years before finding a suitable business model.
Nguyen Thi Phuong Thao negotiated a deal for three years for her airline – the deal never happened.
Hamdi Ulukaya worked for two years with his cheese business before making yogurt.
Guillaume Pousaz spent three years building a payment processor before knowing if it’d work or not.
José Neves struggled for five years before brands started selling on Farfetch.
Tony Tan Caktiong operated ice cream parlors for several years before shifting to restaurants.
John de Mol struggled with his production company for seven years.
Torstein Hagen tried to buy back his cruise company for a decade.
Anyway, you got the gist.
Billionaires are patient. And that’s because they seek to do something specific. They are not seeking dumb money.
5. Billionaires Have a Lot of Energy, Work Hard, and Fight Until They Die
Most billionaires are smarter than average.
In the list, Sam Bankman-Fried, Nguyen Thi Phuong Thao, Daniel Dines, José Neves, Torstein Hagen, Radovan Vitek, and Guillaume Pousaz are geniuses, or close to be.
Such as for Elon Musk, Jeff Bezos, or Mark Zuckerberg, being smart help.
It enables one to notice future trends and surf on them (Jeff Bezos was one of the first ones to understand how the Internet would change everything) or to solve very complicated problems.
Or to come with superior-tech products, as Dines did.
But being smart is not mandatory. Plenty of billionaires on the list are not especially smart – but they have a lot of energy.
They were the kids that wouldn’t be able to take naps, or that’d run around school the entire day, every day.
It has been reported (in the podcast “How to Take Over the World”) that most historical figures, from generals to politicians, were high-energy as well.
It enabled them to:
- Be charismatic
- Inspire
- Work more than the average, hence achieve more
- Not give up
Many billionaires came very close to bankruptcy.
José Neves survived because he had two businesses that were funding Farfetch. Daniel Dines was close to being bankrupt for several years. Torstein Hagen struggled for almost ten years with Viking Cruises.
And Yoshiko Shinohara operated illegally in Japan for 12 years before the law was changed.
All billionaires fought to the death for their business. They never gave up.
This is why they survived.
6. Billionaires Are Learning Sponges
Johann Graf spends most of his weekends reading about the gambling industry. José Neves taught himself to code at 11 years old, then learned how to make shoes voluntarily.
Daniel Dines reads books first thing in the morning, and only goes to work at 10h or 11h.
Goh Cheng Liang worked in an appliance store for four years to learn about paint, then followed classes in Denmark.
Terry Gou spent most of his time in the factory, and Kuam Kan Hon taught himself how to make badges. Peter Gilgan learned to build houses with the workers he had hired.
Billionaires are learning sponges. They never stop reading, observing trends, talking to people, and preparing for the future.
They never stop learning. This is their thirst for knowledge and sometimes, the intersection between two industries they know very well (tech and fashion for Farfetch) that enables them to build amazing businesses.
7. Billionaires Take Risks
Sam Bankman-Fried‘s friend estimated FTX’s chances of survival at 25%.
Torstein Hagen spent all of his savings to buy the first four cruise ships of Viking Cruises.
Daniel Dines quit a comfy job at Microsoft to build his first outsourcing company.
John de Mol launched dozens of shows that never made any money.
And Yoshiko Shinohara opened an evening English class to sustain herself in Tokyo.
All of the billionaires took risks to launch their business and didn’t let it go until it worked.
They put themselves out there and took ownership.
The only person they blamed when it did not work was themselves. No one else’s.
Business Practices
8. Billionaires Innovate AF and Think for Themselves
Billionaires think for themselves.
José Neves thought that e-commerce was a real trend when no one thought it would work for the luxury industry.
Likewise, Tatyana Bakalchuk sold clothes online when everyone was afraid to do so.
Kuam Kan Hon invented light nitrile gloves.
Peter Gilgan was the first one to build houses inside factories.
And Yoshiko Shinohara brought temporary staffing to Japan.
Billionaires innovated by doing something new or that no one knew or wanted to do.
And they never stopped.
Qin Yingling relentlessly worked to find out the best raising and breeding techniques for his pigs. He was the first pig farmer to use tech to monitor his pigs’ health, and went as far as using the IoT (Internet of Things) and blockchain technology to ensure none of his pigs would catch the African swine flu.
He never stopped to evolve his business and made it more efficient than anyone else, which enabled him to grow and dominate.
Reinhold Wurth and Leonardo Del Vecchio established revolutionary management practices for their employees to get the best of them, and applied innovation everywhere in their business.
Terry Gou made huge investments in R&D to be the cheapest and fastest electronic producer.
When someone told these billionaires that what they wanted to do was a bad idea, or that it would “never work”, they didn’t listen and pursued as planned.
Billionaires think and bet on themselves. They look at the data, look at the trends, and make their decision in consequence of that.
They don’t follow the herd.
9. Billionaires Never Stop Growing
Billionaires always grow their business.
They do so in three ways.
- They fix measurable objectives to reach.
- They vertically integrate
- They horizontally integrate
Reinhold Wurth and Leonardo del Vecchio were masters of integration.
Leonardo started making parts of glasses, then made the whole glasses for brands, then invented his own brand, then bought more brands, then bought retail distribution chains.
As a result, Luxottica became a worldwide monopoly on glasses, from start to finish.
This is called vertical integration. It’s when a company acquires activities happening before or after their own line of business.
Reinhold Wurth did the same thing with screws. He sold them, then started making them too. Then he horizontally integrated by making other pieces for professionals.
Today, Wurth is making more than 1 million different pieces of metal. This is called horizontal integration. It’s when a business starts to take care of different services and goods.
Qin Yingling started breeding pigs, then he also raised them, and culled them.
Persol Holdings moved into HR and IT services after outsourcing. Wildberries started selling clothes and now sells everything.
On top of vertically and horizontally growing their company, billionaires don’t sell it. They buy other companies.
Reinhold Wurth went around the world to buy companies like his, while Hamdi Ulukaya bought dairy companies in other countries to launch his Chobani brand.
They always grow, and when they are the biggest in their line of work, they enter other lines of work to dominate.
10. Billionaires’ Companies Excel in at Least One Thing
Guillaume Pousaz likely built the cheapest and fastest payment processor in the world.
Kuam Kan Hon invented the lightest nitrile glove in the world, then made one that is naturally anti-bacterial.
Qin Yingling and Tatyana Bakalchuk are the cheapest in their line of work.
Tomasz Biernacki offers a huge assortment of meat in all of his supermarkets.
Tony Tan Caktiong developed the best fast food recipes.
Peter Gilgan can build a house in 11 days instead of more than 60 for his competitors.
And Nguyen Thi Phuong Thao built the cheapest airline in Vietnam.
You got the gist. All of the billionaires built businesses that excel in one thing.
Be it the prices, customer service, or tech, they dominate in at least one area.
Conclusion
Believe it or not, becoming a billionaire is not so hard.
You don’t even need to invent a business anymore.
When Ray Croc saw McDonald’s, he knew it was a genius idea. He helped develop it and became enormously rich doing so (with some ethical considerations).
It just took a bit of time.
Overall, billionaires build businesses that:
- Have an enormous impact. As the business grows in value, so does their share in the company.
- Take time to build: it takes time to reach one billion, but it goes fast to reach 2, 3, or 5 from that point.
- Commit to excellence
- Are mission-driven: there are two types of companies in the world: those that buy other companies, and those that sell themselves. The former are mission-driven, the latter are profit-driven.
Welcome to Aure’s Notes!
NB: This article was written a long time ago. Since then, I have read many books that both validated and invalidated these principles.
The first bias I want to highlight is the silent evidence. A silent evidence is the evidence that something does not work, but the evidence in question does not survive so people can know.
In this case, you probably have millions of entrepreneurs that respected these principles but never made it.
Let’s be honest: randomness and luck have a role in the making of a fortune.
However, the only way to be lucky at the game is first and foremost, to play it.
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