What’s a billionaire and how do they generate wealth?

Jeff Bezos, the world’s richest person with a net worth exceeding $200 billion. / Net photo.

Did you know that if today’s billionaires formed a country, it would be the eighth wealthiest in the world? It would have around just 2, 100 citizens with over USD 9 trillion in wealth, more than a hundred times of Rwanda’s wealth.

Today, the world has more billionaires than ever. They are fifteen times their number in 1987 and own 30 times the wealth. 90 per cent of today’s billionaires are worth $10 billion or less and there is some 1 percent of mega-billionaires with $30 billion or more.

 

A billionaire is a person who has assets or a net worth of at least one billion currency units such as dollars, euros, or pounds. Billionaires found in other countries such as China or Russia are usually those that have an equivalent of $1 billion or more USD when converted from their own currency.

 

In early 1980s is when the first wealth ranking ranked the first self-made billionaires, The Forbes 400. People like John D. Rockefeller came on the list, founder of Rockefeller Family, a family of American industrialists, bankers and politicians who make up one of the world’s greatest fortunes in the oil industry. His wealth when he died in 1937 was more than twice as wealthy as today’s richest man in the world, Jeff Bezos, who is worth 196 billion USD.

 

Today, there are billionaires from over 60 countries, with the most coming from the United States, Russia and mainland China. There is roughly 100 billionaires in Chinese parliament today, a country that had no billionaire before 1987 and now counts two new billionaires every week.

How is the wealth generated?

Throughout the history, to be extremely wealthy you had to control ‘empires’, such as Mansa Musa, one of the wealthiest individuals in history and Ruler of the Mali Empire who controlled one of the largest sources of gold.

Today, however, the story is different. Today’s billionaires are the people who created or run things that changed lives of millions such as Jeff Bezos, owner of Amazon, or Bill Gates who has given $45.5 billion to charitable causes since 1994.

Most billionaires in the world didn’t inherit their wealth. Many generated wealth via tech companies that was erupting since a few decades ago.

Digital platforms do not take much manpower to operate and can instantly reach a global market. For instance, 90 percent of internet searches are done on Google and its founders were the 10th and 11th wealthiest people in 2018.

Billionaires who are not in the tech world like Kylie Jenner, Michael Jordan or Oprah Winfrey made millions from fame but made billions from creating capital, such as stocks, patents, copyright, beauty and anything they owned. Creating capital is another common way to generate wealth today.

Experts say that billionaires are booming today because of the increasingly global scale economy and that helps the whole world get wealthier.

ailiza@newtimesrwanda.com

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