I think you might be missing a
little of the math here:
A billion dollars is 1,000
million dollars. Please let that sink in.!!!
So if you are a millionaire, you
need to increase your wealth by 1,000 times to become a billionaire. That takes
a serious amount of velocity in your annual earnings. You might as well be
asking “what stops someone who has 1,000 dollars from becoming a millionaire.”
If you are running a business (like most self-made millionaires) even growing
your business by 20% per year isn’t enough. You just won’t live long enough to
amass a billion dollars.
The billionaires that have sprung
up in the last 20 years are all in industries or areas with hyper growth -
either in technology, or emerging markets (India/China). These opportunities
don't pop up every day. It isn’t as simple as taking the same steps you took to
become a millionaire and “lather, rinse, repeat” until you have a billion
dollars.
That’s why there are only about
2,000 billionaires in the world. Much of that wealth is based on their equity
in a business that rapidly expanded in scale (or promises to expand). Is
Facebook really worth 345 Billion dollars? Is Tesla worth $27 Billion? Some
people think so, but Facebook’s net income last year was only about $5 Billion,
and Tesla lost $800 million. Until a billionaire sells his equity, the net
worth is fluid and to some extent theoretical. Forbes list of billionaires
changes all the time. Last year, only 2 of the top 20 billionaires managed to
hold onto their ranking, 221 people fell off the list completely, and 198
newcomers were added.
To be a billionaire, your firm
has to grow well beyond a billion dollars in value (not just revenue) as few
founders own 100% of their shares in their firm. That often takes investors and
partners. You can make a million dollars by yourself, but getting to 100
million in a lifetime takes partners. Getting to a billion requires much, much
more.
There's an old maxim that “what
every millionaire wants is to become a multimillionaire”, and in today's terms
that is likely to go beyond a few million. Certainly, there may be some that
decide enough is enough and they are content with $10 million or $100 million
and would rather spend more time with their families or traveling the world
than adding a few more zeros to their net worth. In that regard, money is a bit
like sex: the more you have, the less likely you are to obsess about it.
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