What does it mean to be self-made?
When it comes to financials, it is about blood, sweat, tears, and hundreds of thousands of hours of hard work and dozens of rejections before finding that success. It is not about getting money inherited to you and growing it.
It’s about taking that last $2,000 in your life savings, throwing it into a modest business in your garage or spare bedroom and putting in the hours and effort to nurture it and make it your own and watching it flourish, fueled by your passion.
And when you have the right skill, excellent customer service and passion for your work, you can make a million dollars – or a billion! – through your own work.
Before you think it seems impossible, just know this – of the Forbes 400 list of richest people, two-thirds of the group (almost 275 billionaires) got their money the old-fashioned way – they earned it.
So for a little inspiration, here is a prominent list of 10 self-made billionaires.
Bill Gates may not have run Microsoft for the last 20 years, but he is Microsoft. A Harvard dropout, Gates collaborated with friend Paul Allen and developed the iconic company in the mid-1970s.
Gates had been programming computers for about 10 years or so before Microsoft came into existence, as he started as a precocious 13-year-old. He began with a deal to produce what was called Microsoft Disk Operating System to be installed in IBM computers, and his continued development of other software helped the company take off.
Microsoft was started in 1975, incorporated in 1981 and became a publicly traded company five years later. He is still the largest owner of Microsoft stock, which accounts for much of his wealth, which is estimated at about $85 billion.
The founder and longtime CEO of Oracle Corporation, Larry Ellison is like many other self-made rich people who achieved much of their fortune in computers in technology. He dropped out of college in the mid-1960s (after attending the University of Illinois and the University of Chicago) and started working as a programmer.
Worth about $50 billion now, Ellison resigned as Oracle CEO a couple years ago and is now the company’s CTO.
The pioneer of Internet-based commerce, Amazon.com, was started in the mid-1990s by a 30-year-old bank executive named Jeff Bezos. After graduation from Princeton, Bezos worked on Wall Street for a couple of banking firms before he established Amazon.com, writing the business plan in his car while his wife drove from New York to Amazon.com’s eventual base in Seattle.
Since then, Bezos has been disrupting e-commerce, technology (with Kindle devices), business solutions (Amazon servers), media (owning Business Insider and the Washington Post) and subscription video and music streaming (through Amazon Prime). His current worth is estimated at around $40 billion.
Carlos Slim Helu
Considered the richest man in Mexico, Carlos Slim Helu is the largest stockholder in The New York Times. He started his professional life with an engineering degree from a prominent Mexican university and went on to own and run companies that were involved in several different economic sectors, including finance, telecommunications and media.
He got his start buying up companies when the Mexican economy tanked and reaped the benefits when the economy recovered.
With a net worth of more than $35 billion, Slim reportedly owns or has a controlling stake in more than 200 companies in his home country.
The three-term mayor of New York City is still the richest man in the city. He started as an investment banker and trader after getting his MBA in the mid-1960s. By 1972 he had reached partner at Salomon Brothers, which was later acquired in 1981. Bloomberg took his severance package from there and started Bloomberg L.P., which was created to provide real-time investment market information.
His name is on a news service geared toward financials, a TV network that follows the markets, and he has maintained fame lately with his push in various gun-control initiatives. His estimated worth is a little shy of $35 billion.
It started as BackRub, a dorm-room project for Stanford doctoral students Larry Page and Sergey Brin in 1998. By 2000, Google had already indexed a billion website domains as the first Internet search engine.
That ability to index and catalog websites led Google to be the brand that becomes its own part of speech (like “get me a Kleenex” instead of tissue, or “let me Xerox this for you,” rather than copy). Not only can we “Google” something now, but Page’s work has developed several other entities like the Android and Chrome operating systems, the Chrome browser, Google Play, Google Plus, Google Docs and Google Drive.
Page, in his mid-40s, is now worth north of $30 billion.
The most well-known casino owner who did not run for president, Sheldon Adelson is the richest person in Nevada, one of the richest in the world and has been a prominent donor to the Republican Party and their causes.
He started as an entrepreneur before his was 13 when he was selling newspapers on street corners. He eventually served in the military and came out to work as a court reporter and trade-magazine salesman.
He eventually started Interface Group in 1975 and a subsidiary, COMDEX Trade Shows, was sold off for $860 million in the early 1980s. He took the profits from that sale and bought the Las Vegas Sands casino property, and his fortunes grew from there. His net worth is estimated at north of $25 billion.
George Soros is a hedge-fund manager who is known for “breaking” several world currencies with his investing bets. He has profited much from the demise of several currencies, most notably the British pound, which a short of that currency in the early 1990s gave his Quantum fund $1 billion in a single day.
He founded Soros Fund Management in the 1970s and has been one of the best managers in history, with his Quantum fund producing annualized returns that exceeded 30 percent. He immigrated to England from Hungary in the 1940s, got a college education, and moved to New York in the early 1950s and started as an arbitrage trader. His hedge-fund plays over the last 40 years have netted him a net worth of about $25 billion.
Making Your Mark
As you can see, it is possible to build something from the ground up and turn it into a multi-million or billion dollar business. But it will take you a lot of hard work.
What if you still want to become rich but not put in the effort to build a business from the ground up? Is it possible? While there is no way you can become rich by putting no effort into it, there is a way for you to become rich over the long term. It’s called investing.
If you follow the process correctly and stay invested for the long tern, you can become rich through the stock market. Chances are you won’t become a billionaire or a multi multi-millionaire but you can reach millionaire status through investing.
How do you do this? First, you have to have a plan. Without a plan, you just randomly invest money, jumping from one investment to the next. After a few years, you will have made very little money (if any at all), get frustrated and give up.
Once you have a plan in place, you then need to make sure you are investing based on your risk tolerance. If you can’t sleep at night because you are scared of losing your money, then you need to dial your risk back.
As important as having a plan is, getting your risk tolerance right is just as important. If you do find you are taking on too much risk, do not overreact. Instead of selling everything, take a minute to get your emotions in check and then get to work. Sell some of your investments for less risky ones.
Lastly, you need to take a long term approach to investing. You aren’t going to become rich overnight investing. It will take many years. Contrary to popular belief, the length of time it takes depends more on how much you can save rather than your return.
Of course, this is a simplified outline of how to become successful investing in the stock market. The post I just linked to goes into much greater detail regarding the steps listed as well as some other ones you need to follow.
At the end of the day, it is up to you as to the path you want to take to become a millionaire. You can create a business from the ground up, learn a lot through the journey and reap the rewards. Or you can try your hand at investing and taking a route that involves less labor. The choice is yours.
Just know that there are risks to each and you need to understand and evaluate them in order to become millionaire or billionaire. Good luck.
Author Bio: Jon blogs at Money Smart Guides, a personal finance site that helps readers get out of debt and start investing for their future.