Silicon Valley is home to 74 billionaires, a report finds.
If you’d like to get really rich, really quickly while you’re still really young, Silicon Valley can make that happen.
Of course, it’s also a place where bank accounts are depleted and dreams fail. But unlike Wall Street — where wealth is ploddingly created as bankers and consultants rise through the corporate ladder — wealth in the tech sector can strike like oil, with the right idea, the right timing and the right luck.
That’s made clear in a new report on global billionaires from Wealth-X, which surveys the landscape of the ten-figured titans. There were more billionaires around the world than ever before in 2017 — 2,754 to be exact, a 15% increase over the previous year — according to the research. The increase is thanks especially to a rise of an elite in Asia, which saw its billionaire population rise by 30% to 784.
Here in Silicon Valley, 74 billionaires make their home, 14 more than lived here in 2016. That increase allowed it to jump to third in the world for billionaires, leaping over Moscow and London (which have 69 and 62, respectively). Only New York (103) and Hong Kong (93) are home to more billionaires.
Overall, the United States is home to one-quarter of the billionaires across the globe and added 60 new net ones last year alone.
But even among the class of billionaires, the technology-built ones are doing particularly well. Wealth-X reports that there are 143 billionaires across the globe in the tech sector, who individually have an average net worth of about $6 billion. The other, less tech-y billionaires? Their average net worth is a $3.3 billion.
“This figure is obviously skewed by the enormous fortunes amassed by a very small number of individuals – six of the 10 richest people in the world have derived the majority of their wealth from the technology sector,” the authors note. “However, it is also a reflection of the huge gains that can be made by tech entrepreneurs around the world in a sector with comparatively low barriers to entry, a high capacity for innovation and still rapidly increasing global demand.”
One difference between Silicon Valley and other sectors, though, is that some of the wealth in tech is in illiquid startup stock. For instance, there’s a legitimate debate as to whether someone like Uber founder Travis Kalanick should’ve been called a real-life billionaire before that money was actually accessible when he sold some of his shares.
But those all those lucrative private stocks create real opportunities for volatility — and therefore value creation. When startups nosedive, suddenly founders discover that they can lose everything. Or, in the words of Wealth-X: “It can be a transitory visit into the billionaire class.”
Case in point: The craze surrounding blockchain in late 2017, which created overnight wealth as bitcoin and other cryptocurrencies spiked (presumably, some of that wealth evaporated when digital currencies fell hard in early 2018).
2017 saw the creation of “the world’s first-ever cryptocurrency billionaire,” the co-founder of the blockchain company Ripple, Chris Larsen, the report notes. But it also “propelled the likes of the Winklevoss brothers in and out of billionaire status in a short space of time.”
But hey, in at least in Silicon Valley it’s possible.
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