The market turmoil seen across the globe has hit some of our best-known billionaires hard.
Warren Buffett has seen about $US11 billion wiped off the value of his stock in Berkshire Hathaway. Larry Ellison is down more than $US7 billion on his holdings. The boys from Google, Larry Page and Sergey Brin, are down about $US2.5 billion.
But after a week in which fear has far outweighed greed, it’s important to recognise the emergence of a group of billionaires that appear to have come out of nowhere.
This week, Bloomberg’s Markets magazine unearthed eight billionaires that until now have escaped the glare of the Forbes billionaire list, which is seen amongst rich watchers as the definitive annual record of wealth around the world. (Disclosure: I have assisted Forbes with valuations in the past).
The list is significant for two reasons. Firstly, it was complied by Matthew Miller, a former Forbes rich list editor who defected to Bloomberg last year to help the company set up what is expected to be a major rich list competitor. This list of eight is Miller’s first direct crack at his former employer.
The list is also significant because it exposes eight really interesting entrepreneurs who have presumably been hanging just off the bottom of the billionaire’s list. Here is a little bit about six members of the gang of eight:
German billionaire Guenther Fielmann owns the creatively named Fielmann, Europe’s largest chain of optical stores with 656 outlets stretching from Poland to the Netherlands.
Like Britain’s Specsavers chain, the former used car salesmen based his success on selling discounted eyewear, cutting out wholesalers and using the size of his chain to deliver economies of scale. Fielmann and his family own 71% of the company, which went public in 1994.
Former Wall Street hedge fund manager Carlos Rodriguez-Pastor is the majority owner of Intergroup, a conglomerate that includes retail banking, supermarkets, department store, movie theatres, fast food chains and hotels.
The company has ridden the emergence of Latin America’s middle class but despite the company’s growth Rodriguez-Pastor isn’t afraid of the odd stunt. According to Bloomberg’s profile, he once dressed up as a giant carrot and handed out leaflets for his company’s insurance arm.
The richest man in Morocco, Anas Sefrioui, is the man behind one of the country’s biggest building and construction companies, Douja Promotion Groupe Addoha. According to Bloomberg, the company’s big break was building 2,371 affordable homes as part of a government program. The company has gone on to build 190,000 homes. Sefrioui listed his company on the Casablanca exchange in 2006.
Siegfried Meister is the man behind such famous culinary names as Gordon Ramsey and Paul Bocuse. Well, sort of. Meister and his family are the majority owners of Rational, a company which manufacturers ovens, steamers and grills for professional kitchens.
The company, which also counts giants such as KFC and Hilton among its customers, has had a bumper year. According to Bloomberg, sales are up more than 50%.
The rise of Latin America is going to be a big feature of billionaire lists in the coming years. Like Anas Sefrioui, Brazil’s Rubens Menin made his fortune from building affordable housing. His firm MRV Engenharia & Participacoes is the fifth largest house builder in the booming Brazillian market and has grown by loaning money to its customers for building costs and keeping its home designs to a few models. Menin seems himself as changing the country.
“When you take a kid from the favela, an unhealthy place, and he moves to an apartment complex, he ends up having better health, better hygiene, better education,” he told Bloomberg.
Canada’s Eric Sprott is a noted gold bug – according to Bloomberg, his publicly listed company Sprott Asset Mangement “oversaw” more gold than Brazil had in its reserves at March 31 this year. Shares in the company have more than doubled in the last 12 months, thanks no doubt to the surging gold price.
It’s worth noting that there are some Australian billionaires who are yet to make it onto the Forbes billionaires list.
The most notable names missing are from the property world: Bob Ell, estimated to be worth $1.2 billion by BRW magazine, and Adelaide developer Con Makris, worth $1.07 billion on BRW’s Rich 200 list.
Property developers can be difficult to value. Most run private companies, which means debt levels are hard to estimate. It can also be very difficult to value property projects at their various stages – while a project may have a final value of a $1 billion when every property is sold, ascribing a value when a project is still in the planning stages or half way to completion is not easy.
Forbes tends to a very conservative approach to these valuations – which may prevent Makris and Ell from joining the global big league for a few years yet.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
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