By James Bennett
The easiest ways to end up stinking rich are tried and true – marry the right person or be born into the right family.
If you can’t manage these, here’s 10 more tips to help you become a millionaire.
Be prepared to work and work and work
The secret of most successful entrepreneurs is not that they are particularly smart or insightful. Rather, most have an incredible capacity for work. Most successful entrepreneurs still work seven days a week, even when they have made their millions. Gerry Harvey even turned his favorite holiday spot at Byron Bay into a luxury resort – money never rests.
Be a serial entrepreneur
Few of Australia’s richest business people strike it lucky on their first try. Queensland billionaire Terry Peabody, who now runs waste management business Transpacific, has successfully floated three companies, including a cement business and a truck company.
Seven Network boss Kerry Stokes tried everything from trucking and property development before becoming a media mogul. Perth billionaire Stan Perron has tried his hand at earthmoving, ice rinks, airlines and car retailing.
Even when they find a particularly successful venture, the stinking rich always keep their fingers in a number of pies.
Be prepared to take at least one big risk
Every stinking rich person had at least one moment early in their career when everything was on the line – all their money, all the bank’s money, their house, their reputation and their future.
Aussie Home Loans founder John Symond put everything into his first business, Mortgage Acceptance Group, and lost $10 million, his home and his marriage when it collapsed. He’s now worth almost $600 million, which goes to show you can survive, and prosper, even if your big gamble fails.
Follow your passion and skills
Can’t decide which type of billion-dollar business you want to be in? Start by thinking about the things that you really love. Love fashion? Then start a fashion label, just like Sass & Bide founders Sarah-Jane Clarke and Heidi Middleton did.
Bruce Gordon followed his love of entertainment (he was once a stage magician) into the film industry before building the WIN regional television empire. Tasmanian Allen Hansen loved diving for abalone, so he built one of Australia’s largest seafood companies.
Cool, dispassionate analysis is important in building a business, but some good old-fashioned enthusiasm is also essential, particularly to get you through the tough times.
Build networks
It is incredible how many of Australia’s most successful business people are old friends. John Singleton and Gerry Harvey? They backpacked together through Europe. Solomon Lew and Lindsay Fox? Old friends. Jack Cowin and Brett Blundy? They know each other well and are co-investors in Sydney Harbour Bridge tourist attraction BridgeClimb.
Networking can sometimes be a time-consuming (and even boring) process, but having influential friends is always an asset.
Go it alone
When you are trying to grow your company quickly, there is a huge temptation to sell a slice of the business in order to fund expansion. Don’t do it.
People like Richard Pratt, Lindsay Fox, David Hains and Harry Triguboff are billionaires because they have resisted the temptation to sell out to venture capitalists or investment bankers.
If you do have to float or sell shares in your business, make sure you keep a majority stake. The stinking rich don’t manage by committee.
Anticipate future trends
One of the richest men in the world, Microsoft founder Bill Gates, built an empire by knowing what consumers want before they know themselves. The Australian business scene is full of similar examples.
“Crazy” John Ilhan picked the mobile phone boom better than anyone else. Paul and Andrew Bassat started the online job ads business Seek when the majority of employers were placing newspaper ads. Eddy Groves built Australia’s first corporate child-care company, ABC Learning Centres, and now dominates the sector.
Sell when the price is right
Timing is everything, and if you want to get stinking rich, you’ve got to know when to cut and run. Retail king Solomon Lew is a genius at picking the top of the market and has recently locked in big profits on his stakes in Coles Group, Colorado and fashion chain Witchery.
In the 1990s, recruitment industry veterans Andrew Banks and Geoff Morgan sold their recruitment company for a big price and bought it back, netting them more than $100 million. Kerry Packer famously did the same with the Nine Network.
Go global
The Australian economy is relatively small and mature, so many local entrepreneurs have been forced to go overseas to build their empire. For money managers like hedge fund guru Michael Hintze (worth $600 million) being based in London means ready access to European clients and capital markets.
If Paul Stoddard tried to base his aircraft spare parts business in Australia, he simply wouldn’t have enough customers, but over in Europe he has as much work as he can handle.
Get into mining or financial services
If you want to get rich quick, find a patch of dirt with some minerals in it and start digging. If that’s not an option, start an investment bank or funds management business. Resources and financial services will continue to be the hottest sectors in the Australian economy.
You will find more wealth creation strategies in our Growth Resources, Wealth/Super section.
