<p>Many of the people I know are all about money and are pursuing careers that will land them a lot of cash. I don’t exactly agree with this methodology, but it got me thinking. How do people like Warren Buffet, Bill Gates, and Donald Trump come to reach their multimillion/billion dollar earnings. If your quest is to earn a multimillion dollar salary, how do you set out to achieve it? Obviously this cannot be done with “normal” jobs like accounting, engineering, or medicine. How did these men become so wealthy and how are they different from us? Are they smarter, more driven, or simply lucky? I just don’t understand how some of these people acquire their enormous salaries? Athletes and entertainers are the exception. Any input…</p>
<p>Well, with Gates, it came from the family. His mother (very rich family) was friends of the then-President of IBM, and was having lunch with him, when it came up that IBM was looking for an open-systems operating system. At the time, Billy had produced at operating system, certainly no better than 50 or 100 other system produced at the time, but he was willing to sell it. The rest is history, sort of. Bill Jr. has been very adept at buying up other people’s talent, and confining other people’s so that it hit the wastebin of history.</p>
<p>Suffice it to say that very, very few people ever become multimillionairs without being their own bosses - “multimullion dollar salary” is for the most part an oxymoron.</p>
<p>So unless you come from a wealthy family, would you say that it is nearly impossible to become a millionare. Hence the saying “you need money to make money.”</p>
<p>what were the backgrounds of the google and yahoo guys? i know grad students, but in terms of family?</p>
<p>"So unless you come from a wealthy family, would you say that it is nearly impossible to become a millionare. Hence the saying “you need money to make money”</p>
<p>I wouldn’t say that at all. If you own a house in a hot real estate market, in California or New York, etc., you are probably a millionaire (and in many cases don’t even know it.)</p>
<p>Best advice though is to be white and male. Choosing your parents well is very important! ;)</p>
<p>I do have some hard data, too, though not about the wealthiest 1%.</p>
<p>in 2002, if your parents were in the top fifth of the population in annual income, the chance of you being in the top quintile was 42.3%; middle quintile 16.5%; bottom quintile 6.3%.</p>
<p>If your parents were in the middle quintile, the chance of you being in the top 5th was 15.3%; middle quintile 25.0%; bottom fifth 17.3%.</p>
<p>If your parents were in the bottom fifth, the chance of your begin in the top fifth was 7.3%; middle fifth 18.4%; bottom fifth 37.3%.</p>
<p>These “chances” are exaggerated at both the top and bottom ends of the scale, at the top because a greater part of income is return on assets (that is, you don’t have to do anything additional to realize them); and at the bottom, because second generation after immigration tends to rise.</p>
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<p>For these super-rich guys the vast majority of their wealth is not in the form of salaries. It is the stock they own in the companies they founded.</p>
<p>When you read that Bill Gates has 50 billion, Microsoft has not paid him 50 billion in cash. It is mostly the Microsoft shares he owns multiplied by the current selling price.</p>
<p>So I’d say the best way to get as rich as these guys is found some highly successful company and retain a lot of its stock. Not an easy thing to do.</p>
<p>Yup. That’s the ticket. Even Oprah is rich mostly because she owns the production of her show and sells it to stations. Best move she every made.
BTW BGates did not even develop the software they sold to IBM–He bought it from a local developer for a small amount.</p>
<p>Indy787,</p>
<p>Unless you are a stock wiz who understand value investing better than anyone else, can invent a computer operating system or be born into a family that already owns mega-real estate, its probably going to be tough to get to their level. :)</p>
<p>Most entrepreneurial people become successful by controlling “land, labor and capital”. Dont translate “land” as necessarily meaning acreage. It could mean controlling the lease on a building. Labor will generally start out being provided by the entrepreneur, but he/she will eventually need help to expand their enterprise. Capital is self explanatory, though the intial investment might be quite small…and the capital you control could be someone elses cash! </p>
<p>Many years ago I made a living by promoting auto racing events. I didn’t own any race tracks, but I did control land by leasing the facilities for my events. That also meant I had the help of labor. I started out with very little capital, but lived on almost nothing and kept expanding my events in both scope and numbers. Eventually bought an interest in a drag strip. (But, that is another story. The recession of 1990-91 taught me a good lesson about why you should not carry too much debt. :)</p>
<p>The current business I am operating started with a $4,400 dollar investment and a sublease on a property. It has expanded far beyond what I had ever imagined and I am still plowing all the profits back into this business. In my case, I have pretty strong sales skills. Many entrepreneurial people do.</p>
<p>I can’t tell you how to make a multi million dollar salary, because I dont know how. And, I wouldn’t want to. Who wants to be Donald Trump and have more ex-wives than you can count? Do you think Bill Gates wealth is only an asset? or, is it also a burden? So, even if you dont join the ranks of the fabulously rich and famous, you may find out a very impressive income might be achievable by employing the basic principles of entrepreneurialism and living like you are a pauper while your business grows. </p>
<p>Most people don’t seem to be willing to work the long hours and make the financial sacrifices that it takes to start a business from basically nothing. For several years I worked a full time job and ran another small business part time while I started this current business! </p>
<p>Mini suggests chosing your parents well. Unfortunately, I did not. I fit the white male description, but my Dad was a parking lot attendant and my Mother dropped out of high school because of my arrival. 
We lived in a housing project for many years. </p>
<p>By the way, yes, some of it is luck. Luck is when preparation and opportunity meet. </p>
<p>Good luck!</p>
<p>You can also amass a fortune in various aspects of real estate in a couple of decades if you have the focus and the smarts. Being a bit amoral can help.</p>
<p>I know many, many people who became mulitmillionaires (not Gates money, but double digit millions) by going to a top business school. My graduate MBA program produced more millionaires than not who came from all sorts of backgrounds. 20 years of working for a consulting firm, investment bank, or at a senior level in a corporation will make you a millionaire many times over. Gates is rare, but the last 2 decades have produced more millionaires than ever in history based on education.</p>
<p>Indy, in the first place, none of these mega-millionaires ever went looking for a “job”. If anything unites them, it is that they are “I wanna be my own boss” types who looked for business opportunities, not employment. They are also risk-takers who were willing to jump on something speculative, recognizing that their opportunities lay in the areas where others were afraid to venture. And they were willing to forego immediate reward while they built a strong foundation for their business-- it can take many, many years before a business starts to turn a profit, especially one based on new technologies or ideas. I’m sure “getting rich” was an ultimate goal – that’s why they all had such keen business sense, and wrote the contracts and leases that are key to their financial riches. But those contracts would have been meaningless if whatever they had been selling flopped – and I can guarantee you that in the 1970’s there were probably thousands of computer nerds tinkering with homemade computers in their garages with the idea that they were going to write the code that would dominate the home computer market. Only a handful ever got anywhere. So it’s a combination of a lot of hard work, the willingness to take on a considerable amount of risk, the guts to strike quickly when an opportunity arises, a very keen & calculating business sense, and a whole lot of luck. </p>
<p>It helps a lot to already be rich, but that’s not the key - the key really is the combination of the desire to be the one at the top and intellectual and emotional ability to make it all happen. </p>
<p>The answer to “how did they get their jobs” is they didn’t – they MADE their jobs. </p>
<p>It’s not an easy or safe path – few people who are strongly concerned about their incomes are willing to take that path. It means foregoing things like a steady salary, pension plans, employer-paid health insurance, and all the other things that make people who aspire to an expensive lifestyle feel secure. And again, for everyone whe is successful and becomes a mutimillionaire as an entrepeneur, there are hundreds who barely eke by or end up in bankruptcy.</p>
<p>Important to note is that there is HUGE differnece between Bill Gates and Steve Jobs and the many, many people who become millionaires in the last 2 decades with great degrees. If you went to Harvard or Stanford business schools (and a few others) and chose a career in consulting, ibanking or to climb ranks in start ups or F500 companies, chances are that you are a multimillionaire today. This is likely to continue.</p>
<p>there’s also the lelement of being able to take risks and handle setbacks.</p>
<p>Most very successful people are bold-- and when they get knocked down, they don’t stay down.</p>
<p>Hey Indy –</p>
<p>When scanning your first post was first thinking of Jimmy, the Buffett rich in many other ways…</p>
<p>Do a search for Fortune’s 400 wealthiest people. They have a quick note about how they made their money (inheritance, real estate, etc).</p>
<p>Edit: Forbes, not Fortune, and here is the link:</p>
<p><a href=“http://www.forbes.com/2002/09/13/rich400land.html[/url]”>http://www.forbes.com/2002/09/13/rich400land.html</a></p>
<p>You can sort by how they made their money, age, geography, etc.</p>
<p>I think too many people focused on the ‘salary’ word…the question was clearly a general 'income ’ one… I will comment below</p>
<p>FIRST, to MINI and others who emphasiz that starting out rich,white and male are the only way to go… This falls into the first advice I would give, STAY AWAY FROM NEGATIVE PEOPLE. What they are trying to tell you (and other threads where they opine that there is a conspiracy to suppresse the little man) is that you can’t achieve so don’t try </p>
<p>Now to my general comments. Iagree with Calmom, generally you want to be an owner of somewthing–and that can be knowledge. My short story, I am white and male (and I don’t disagree that it helps-but dont use your situation as an excuse) … but grew up poor,… my dad was mentally ill (believed he was in the CIA, fighting communist) … I went to a large state university in west Texas, … I GOT INTO A PROFESSION I LOVED AND EMBRACED COMMERCE … I am not Gates rich but my financial worth is several million … I dont like the “I am worth …comment” … KEEP A MORAL COMPASS --that is true worth
and a little LUCK helps </p>
<p>STAY AWAY FROM NEGATIVE PEOPLE
DO SOMETHING YOU LOVE AND DONT APOLGIZE FOR MAKING MONEY
BE AN OWNERKEEP A MORAL COMPASS
BE LUCKY</p>
<p>I would suggest that to be gates wealthy, is not superior intellect or superios hard work it is being all and very lucky</p>
<p>ramble over</p>
<p>YOu picked three interesting examples.</p>
<p>Trump started extraordinariliy well off because of his fathers real estate investments and the governments long term preference for inflation. He learned to bully people and and has become something of an expert.</p>
<p>Buffet is a Columbia B school grad who paid close attention to good investors, and figure a few things out. </p>
<p>Gates actually is a little more interesting that Mini recalls. He started Microsoft by going out to secure some contracts for varioius government agencies…like a car counter program for traffic lights. It started in New Mexico, I believe. It had been around and struggling to break even and meet payroll for awhile (maybe about 5 years or so), when IBM needed an operatiing system for its PC. [the justice department was harassing them at the time and they felt a need to buy whatever they could from smaller companies.] Gates became aware of this, possibly because his mother sat next to Akers at a fund raiser. Gates didn’t own an OS program, but knew someone who did, went out and bought it for some modest sum, tweaked it up a little, and the result was DOS. </p>
<p>Don’t pay any attention to the drumbeat on these boards b##tching about the old boy network. If you’re not white or male, you still have a very good chance of achieving whatever you want.</p>
<p>OF course, your library will have many books about these and other wealthy people and how they got that way. It is fascinating to attempt to discern how much was good fortune and how much was preparation. Most of them like working a great deal more than the average person.</p>
<p>Wow, there are some insightful replies so far. I really had no idea about the real story behind Bill Gates. So DOS was not fully created by him? Also, did he drop out of Harvard after making a sale to IBM?</p>
<p>Gates was gone from Harvard for quite some time before the IBM entry into the PC business that required an operating system, (which they felt compelled to buy from someone because of the antitrust suit against them).</p>
<p>Here’s a site I stumbled on,sure there are many more… It has a collection of stuff on gate’s early years. He dropped out of Harvard about five years before IBM and DOS showed up. I remember his recounting in Fortune that they had a contract with Fujitsu to write some code and were hoplesslessly behind schedule, and the Japanese sent a rep over to stay with them until they finished the project. Gates said that the poor guy wasn’t a programmer and that the only thing he could do was sit there with them and tell them that if they didn’t finish on time, he would lose his house, family, and all of his possessions.</p>
<p><a href=“http://www.jmusheneaux.com/39cc.htm[/url]”>http://www.jmusheneaux.com/39cc.htm</a></p>
<p>I recall reading the MS story in Fortune some years back. I was surprised to know that he was knocking around for about five years or so before he got the DOS break. THat was very fortunate. I also understand that IBM had offered the job of OS design to someone else first, and the guy turned it down, not wanting to get involved with a big stodgy mainframe company.</p>
<p>In any case, Gates is a clever, hard-nosed competitor. But he took some serious risks in going out there in 1975 and hacking around trying to make his own living. Most people who do that don’t wind up where he did.</p>