How Jeff Bezos Became One of the World’s Richest Men (2023)

As of early 2023, Jeff Bezos is the third-richest person on Earth, with his personal fortune eclipsing the wealth amassed by Microsoft Corp. co-founder Bill Gates andlegendary investor Warren Buffett. According to the Bloomberg Billionaires Index, Bezoshas a net worth of $126 billion as of this writing.

The founder, former chief executive officer (CEO), and now executive chair of global e-commerce behemoth Amazon was responsible for running aplatform that accountedforup to 6.5 of all U.S. retail sales and a whopping44.9% of digital retail spending in 2022.

As digitalization reshapes human behavior and the cloud computing revolution does the same to enterprise, the leader in online retail, with its high-flying cloud computing platform Amazon Web Services (AWS), is only forecasted to propel higher—spelling more good news for its founder.

When Bezos had the idea for his e-commerce company, his well-intentioned boss tried to talk him out of quitting his stable job with D. E. Shaw & Co. Yet Bezos, raised by his teen mom and later his Cuban immigrant stepfather, always dreamed of creating something different, once tellinghis schoolteachers that “the future of mankind is not on this planet.”

Bezos even has a website,BezosExpeditions.com, that provides a rundown of more than 40 of his major investments, projects, and philanthropic endeavors. The name “expeditions” is appropriate since Bezos’ investments are not concentrated in just one or two industries or even market sectors; rather, they represent a far-flung exploration of many different business areas and ideas, including cloud computing, robotics, biotechnology, and even home-blown glass.

Amazon: Beyond Books

The tech visionary graduated from Princeton with degrees in computer science and electrical engineering.Upon graduating,he turned down job offers from companies such as Intel and Bell Labs to join a startup called Fitel. He went on to launch a news-by-fax service company with Halsey Minor, the founder of CNET. After that venture failed, Bezos became the youngest senior vice president at a hedge fund called D. E. Shaw, working his way up the ranks in just four years.

Bezos might have stayed on Wall Street for the rest of his careerif he hadn’t been enthralled by theknowledge that, by 1994, the Internet was growing at a rate of 2,300% annually. Soon enough, hisidea for Amazon was born, and the future CEO began making a list of 20 possible product categories to sell online.

Amazon.com, then a platform for selling books, grew in its early stages out of a garage with a potbellystove. Bezos, who put his own $10,000 into the company comprising himself, his wife, and twoprogrammers, ironically conducted most of his meetings at the neighborhood Barnes & Noble.Within its first month after launch in July 1995, Amazon sold books in every U.S. state and 45 countries around the world.

Beating Expectations

During Amazon’s first year, Bezos tried to raise money by predicting $74 million in sales by 2000, far underestimatingthe reality: $1.64 billion in sales in 1999 alone. He managed to gather $1 million in seed funding from angel investors after using up investments from his family—primarily from his parents, who contributed a significant portion of their life savings.

The first approximately 20 investors in Amazon put in about $50,000 each for a stake rounded to 1%. Each investment would be worth approximately $3.5 billion, representing a roughly 70-times return in about 20 years, giventhat the investors held onto their entire stakes and that theyhad never been diluted by later investors. In June 1996, Amazon raised another $8 million in Series A from venture capital firm KleinerPerkins.

Amazon went public in May 1997and turned out to be one of the few startups thatsurvivedthe dotcom bust. As the platform diversified its product offerings and solidified itself as a market leader and pioneer, annual sales skyrocketed from $511,000 in 1995 to more than $3 billion in 2001.

In 2013, Bezosrevealed his plans for the company’s revolutionary Amazon Prime subscription business would use drones to make deliveries to customers. The company announced in 2022 that the first Amazon Prime Air drone deliveries would begin servicing limited areas with plans for future expansion.

In 1998, Bezosalso became an early investor in Google. While he hasn’trevealedwhat amount of thestock he owns after its initial public offering in 2004, his $250,000 investment would be worth billions today.

In August 2013, Bezosbought The Washington Post for $250 million. A couple of years after, its audience and traffic exploded, surpassing The New York Times for the first time in terms of U.S. unique web viewers in October 2015.

Amazon’s share price reflects its phenomenal growth. The stock increased about 450% from January 2016 to January 2021 and rose 60% from January 2020 to January 2021 alone. Bezosowns about 12.7% of Amazon as of 2022, making it a large source of his wealth.From 2017 to 2019, Bezos sold more than a million shares and distributed additional shares to his now-ex-wife as part of divorce proceedings. The company’s 2022 annual meeting announcement showed Bezosowning more than 64.5 million shares.

Real Estate

Bezos also has substantial holdings in more traditional investments, such as real estate. His 165,000-acre Corn Ranch in Texas was acquired as the base of operations for his aerospace company, Blue Origin, and serves as the test site for the vertical-landing manned suborbital New Shepard rocket.

His personalreal estateincludes holdings on the East and West Coasts. Bezos has two multimillion-dollar homes in Beverly Hills and a 10,000-square-foot apartment in the Century Tower in Manhattan that cost him just under $10 million. Bezos’ New York presence is reported to have boosted Century Tower property values even higher, with space selling for $2,000 to $3,000 per square foot. He also has a lakeside property in Washington state, on which he spent $28 million to increase the living space to almost 30,000 square feet.

In 2012, Amazon bought its own South Lake Union headquarters building in Seattle for $1.5 billion, instantly making the company one of the city’s largest commercial property owners. Amazon took possession of nearly a dozen buildings, almost 2 million square feet of office space, and approximately 100,000 square feet of retail space. In August 2017, The Seattle Timesreportedthat Amazon had as much office space as Seattle’snext 40 largest employers combined, having expanded to 8.1 million square feet.

Charitable Donations

Bezos has also invested very sizable sums in giving back through charitable donations. In addition to the Bezos Family Foundation that funds several education projects, Bezos has made individual multimillion-dollar charitable contributions to Seattle’s Museum of History & Industry as well as to his alma mater, Princeton University.

In January 2018, Bezos and his now-ex-wife,MacKenzie, announced a $33 million donation to TheDream.US, an organization working to improve college access forundocumented immigrant youth who were brought to the United States as young children. The grantwill provide college scholarships to 1,000 U.S. high school graduateswith Deferred Action for Childhood Arrivals (DACA)status.

Media, High Tech, Glass, and Travel

Bezos has an affinity for the technology sector, for media and communication services that facilitate connecting people, and for just what he considers to be potentially profitable investments. In the media and communications sector, Bezos has invested in Twitter Inc. and the popular business news website Business Insider. Zocdoc Inc. and Nextdoor are both platforms for connecting people in which Bezos has invested.

In the travel sector, Bezos has invested more than $30 million in transportation company Uber. Bezos is a big believer in the cloud, as evidenced by Amazon’s major push into providing cloud computing services. However, his investment interest does not end with his own company. One of his notable investment successes is Workday Inc. a company that provides human resource servicesin the cloud. Shortly after Bezos’ venture capital investment in the company, it went public in aninitial public offering (IPO) that garnered more than $684 million. In the sphere of a more traditional retail business, Bezos has also invested in glassybaby, a company that makes glass-blown holders for votive candles.

The Way-Out-There Ideas

Two of Bezos’ investments that garner a lot of attention—and are considered a bit off-the-wall—are the 10,000-year clock and the now-complete F-1 engine retrieval project. The 10,000-year clock project is an effort to build a clock into the side of the Sierra Diablo mountain range in Texas, a clock that literally keeps ticking for 10,000 years. The clock is planned to have a chime generator that generates a different chime sound for each day. Just coming up with 10,000 × 365 different chimes sounds like a pretty daunting challenge. Bezos explainedthe need for the clock by saying today’s global problems require “long-term thinking.”

The F-1 engine retrieval project was an effort to salvage from the Atlantic Ocean floor the engines that powered the Apollo 11 flight to the moon. Enough artifacts were recovered to fashion displays out of two F-1 engines. The artifacts were donated to The Museum of Flight in Seattle in 2015.

With his booming wealth, Bezos is now able tofulfill his childhood dream of becoming a space entrepreneur. Each year, he commits $1 billionto his space exploration company, Blue Origin—which,in 2016, became one of the first commercial companies to launch a reusable rocket.

OnJuly 18, 2018, Blue Origin sent the New Shepard spacecraft into high altitude to test its safety systems, which worked. On July 20, 2021, Bezos, his brother Mark, aviation pioneer Wally Funk, and Dutch student Oliver Daemen boarded the New Shepard and completed Blue Origin’s first successful crewed flight, reaching an altitude of just above 62 miles before landing safely.

The Bottom Line

Although Bezos lost the title of the richest man on Earth to Elon Musk in 2021, he remains the second-richest person and the only other individual on the planet with a net worth that hovers around $200 billion. It’s also important to keep in mind that the vast majority of both men’s fortunes are derived from unrealized assets. As such, it’s entirely possible that Bezos’ wealth may once again exceed Musk’s someday.

However, for this to occur, the share prices of Amazon and Tesla will have to spike and/or plummet, respectively. Although it may be unlikely, given just how much Musk’s fortune has grown this year, this scenario isn’t without precedent. In January 2021, Musk briefly became the richest man on Earth after Tesla shares surged, though Bezos reclaimed his title once the automaker’s share price had declined by mid-February.