Who Wants To Be A Trillionaire?

By Stephen D. Simpson, CFA | March 03, 2011 AAA
Who Wants To Be A Trillionaire?

One trillion dollars is a figure so vast most people cannot really get a firm hold on what it means. One trillion is roughly the GDP of Mexico and South Korea, one-half of the U.S. federal government's revenue in 2010, and enough to buy Exxon Mobil, Apple, Google, Nike and Agilent, with billions left over. (For related reading, also check out What's Your Billionaire Age?)

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Even though $1 trillion is an unthinkably large sum of money, sooner or later the world will have its first trillionaire. When John D. Rockefeller became a billionaire in 1916 that too was a seemingly impossible level to attain - and that billion dollars was equivalent to around $400 billion in today's figures. Let us consider, then, who might have a chance of approaching this figure and it will require.

Carlos Slim Helu
Carlos Slim is a well-known Mexican tycoon with major interests in landline and cellular telecommunications in Latin America. Worth upwards of $54 billion in 2010, but also 70 years old, Slim faces long odds of even approaching $1 trillion. Assuming another twenty years of wealth accumulation, Slim would have to see compound annual growth of 16% - an unlikely achievement given the top-line growth of his primary holding is in the mid single-digits.

Warren Buffett
Like Carlos Slim, Warren Buffett faces the twin hurdles of advanced age and an enterprise growing slower than the rate necessary to attain $1 trillion. Mr. Buffett was worth about $47 billion in the last Forbes roll call and is ten years older than Carlos Slim. That means Mr. Buffett would need compound annual returns of almost 36% to achieve $1 trillion by age 90 - a level far above the 20% annual compound growth in Berkshire Hathaway's (NYSE:BRK.A) book value over the past 45 years. (Find out how he went from selling soft drinks to buying up companies and making billions of dollars. To learn more, check out Warren Buffett: The Road To Riches.)

Bill Gates
Bill Gates arguably has time on his side at age 54, but his focus on donating his wealth to worthy causes suggests his net wealth figure will be heading in the wrong direction to attain $1 trillion. Still, if Mr. Gates were to live to be 90 years old and chose to refocus his efforts once again on wealth accumulation, it would take annual growth of about 8.5% to reach $1 trillion - the first candidate on our list with a goal that seems attainable.

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Mssrs Mukesh Ambani and Eike Batista
Largely unknown to most readers, these two gentlemen are both 53 and own sizable interests in industrial conglomerates focused on the emerging economies of India and Brazil. Both men would need to see 37-year runs of 10% growth to become trillionaires; those figures seem exceptionally ambitious, but perhaps not impossible given the ongoing growth in their home markets.

The Plutocrats
It would be remiss to talk about the super-wealthy and fail to mention those who owe their wealth to the privileges of wealth and rulership. The current king of Thailand (Bhumibol Adulyadej) is reported to be worth around $30 billion due to royal investments in major Thai businesses like Siam Cement, Christiani & Nielsen, and Shin Corp, while the current Sultan of Brunei has accumulated a $20 billion fortune from his nation's petrochemical assets.

Though King Bhumibol will almost certainly not live long enough to attain $1 trillion, the growth of potential of Thailand and Southeast Asia is such that it would not be unthinkable that an heir to the throne (the 59-year old Prince Vajiralongkorn or a further descendant) could eventually reach that point.

Mark Zuckerberg
Based on recent transactions, Mr. Zuckerberg's Facebook stake means he is worth a reported $12.5 billion at age 26. Assigning the same assumed lifespan of 90 years, Zuckerberg would need to see 7% compound annual growth to become a trillionaire

John Arnold & Yang Huiyan
With an estimated net worth of $4 billion in 2010, hedge fund manager John Arnold would need annual compound wealth growth of 11%, while China's Yang Huiyan would need to see 9% growth, largely from her stake in mainland China property developer Country Garden.

Stay Tuned For the Next Idea
As few people would have predicted a decade ago that a social networking site could be worth $50 billion (assuming they knew what a social networking site even was), it is quite possible that the world's first trillionaire will come from a product, service or market that is all but unthinkable today. As government regulations will not allow a monopolist like Rockefeller to thrive again, it will take a savvy and forward-thinking business mind to build a large enough enterprise to make its owner a trillionaire.

The growth of emerging and financial markets make those credible sources of super-wealth, but time has shown again and again that the right combination of market, opportunity, willpower and ability can produce exceptional wealth from almost any type of business. (More than 70 years after his death, this man remains one of the great figures of Wall Street. See J.D. Rockefeller: From Oil Baron To Billionaire.)

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