This is super wrong! Honestly they should probably take this down because of how wrong it is.
Where is Norman Borlaug?
Looking only at stocks is spitting in the face of every economist in the history of humanity. And they didn't even do that right. A company is not one person for starters! And what about if your company causes another company's stock to decrease in value, thereby destroying wealth? This is embarrassing.
Comments here are all arguing over the list without reading or understanding the methodology.
My biggest issue with the methodology is that it really only counts stock returns of people not including founder in excess of the T-Bill rate since the IPO. So companies, like Dropbox, that are less than where they were on IPO date give their founders huge negative value created for others, despite the fact that lots of people besides Drew Houston got rich as pre-IPO investors.
I still think the methodology is useful - collectively, every investor since the IPO into Dropbox has done pretty horribly. But that's also pretty obvious just looking at the stock price.
Obviously there are a billion different possible interpretations of what "wealth" could mean, but even if you only take the very narrow definition of "outside investor returns", this is only looking at post-IPO returns.
Read the article. It calculates wealth creation in a very specific way, looking at public company value minus what the founder/largest shareholder holds. Obviously that doesn't apply to Linus Torvalds.
Obviously this is only a very small slice of what "wealth" means, but it's easy to calculate and objective.
Yes I was seeing it as a list of people. Even if you ignore Linux and focus only on the amount of wealth Git has created... ...I still think he'd be at the top.
Yeah, it only pays pensions, retirement accounts, provides liquidity for new industries, which then grow and provide jobs, and has been demonstrably one of the best inventions for pulling billions out of poverty and increasing standard of living generation after generation for hundreds of years over hundreds of countries on the planet.
Not talking about Eric Schmidt specifically, but this list seems to irrationally over allocate value creation to founders rather than the team that supports them?
How is the "Multiple" column calculated? Is it wealth created "For Others" / "Self"? I can't get to that number for anyone if this is the formula. And Elon Musk's mutliple looks downright wrong if he created $357B for others and $917B for himself with a multiple of 1.4×
> Each figure is the shareholder wealth a founder’s company created, now held by index funds, pensions, employees and co-founders, minus what the founder kept.
At a glance, this seems heavily recency-biased and not adjusted for inflation. I would expect a lot of other names that predate the 21st century to be on the list. The methodology page doesn't even contain the word 'inflation'.
Personally, I thought the list was about the criteria for wealth creation—like a standard for discovering the most valuable knowledge, technologies, or research papers. But it turns out it's just a slightly different rich list. So what value did Buffett actually create?
I was expecting to see a list of technologies like Linus's Linux or the transistor, but it's just a list of rich people.
The strangeness of capitalism seems to be that it misjudges value that hasn't been financialized.
I think the title is misleading—I should probably correct it to something like:
'A list of donors who contributed a lot of dividends and capital gains to Wall Street pension funds and index funds.'
Elon musk is among the top of the list. He is also the founder of companies that created and advanced a lot of technological wealth in the world. A huge contribution.
But it's far from certain that the recent SpaceX stock will create a lot of wealth for retail owners. Maybe even the opposite.
SpaceX is the only one I know that he founded and which, through their satellite network advanced "technological wealth".
Also this lists definition is:
> "Each figure is the shareholder wealth a founder’s company created, now held by index funds, pensions, employees and co-founders, minus what the founder kept."
I'm no economist but I'm having a hard time grokking any meaning out of this metric.
So if Elon decided to sell all his shares today (and likely destroy his companies in the process), he'd shoot to the top of the list? What's the point in that?
My 401k has benefitted from the growth of e.g. Amazon for sure, but the main 'wealth' I get from them is my ability to buy anything and get it delivered in a day. That is, I benefit from their infrastructure existing, regardless of who the shareholders are.
> So if Elon decided to sell all his shares today (and likely destroy his companies in the process), he'd shoot to the top of the list? What's the point in that
It looks like the methodology involves subtracting the founder's entire net worth, so selling the shares would leave him in the same place.
Hmm you are right. But looking closer at the methodology, I find myself even more confused.
It seems the metric is something like "most successful stewards of shareholders' investments" which I guess is interesting. But now I'm tripped up on why the metric would only consider founders rather than CEOs more generally. Imagine Gates didn't start Microsoft, but instead became its CEO a month after some other founder started it and that founder sat on the beach in Hawaii while Gates did well, what he did. The founder would appear on this list but not Gates.
Edit: basically, all my intuitive "this doesn't make any sense" alarm bells are going off, but I think I need someone who really knows what they're talking about to help me understand exactly why, or what would be a more sensical version of this
This is super wrong! Honestly they should probably take this down because of how wrong it is.
Where is Norman Borlaug?
Looking only at stocks is spitting in the face of every economist in the history of humanity. And they didn't even do that right. A company is not one person for starters! And what about if your company causes another company's stock to decrease in value, thereby destroying wealth? This is embarrassing.
Comments here are all arguing over the list without reading or understanding the methodology.
My biggest issue with the methodology is that it really only counts stock returns of people not including founder in excess of the T-Bill rate since the IPO. So companies, like Dropbox, that are less than where they were on IPO date give their founders huge negative value created for others, despite the fact that lots of people besides Drew Houston got rich as pre-IPO investors.
I still think the methodology is useful - collectively, every investor since the IPO into Dropbox has done pretty horribly. But that's also pretty obvious just looking at the stock price.
Obviously there are a billion different possible interpretations of what "wealth" could mean, but even if you only take the very narrow definition of "outside investor returns", this is only looking at post-IPO returns.
Somehow, I expected Deng Xiaoping to be number 1, pulling a billion people out of poverty. Then I read the methodology used.
Where is Linus Torvalds on this list?
I would expect him to be in one of the top spots.
Read the article. It calculates wealth creation in a very specific way, looking at public company value minus what the founder/largest shareholder holds. Obviously that doesn't apply to Linus Torvalds.
Obviously this is only a very small slice of what "wealth" means, but it's easy to calculate and objective.
What's his "company"?
This is a list of people.
Yes I was seeing it as a list of people. Even if you ignore Linux and focus only on the amount of wealth Git has created... ...I still think he'd be at the top.
His organization is The Linux Foundation.
Jimmy Wales too
Boy this really shows how little value the market provides
Yeah, it only pays pensions, retirement accounts, provides liquidity for new industries, which then grow and provide jobs, and has been demonstrably one of the best inventions for pulling billions out of poverty and increasing standard of living generation after generation for hundreds of years over hundreds of countries on the planet.
We should outlaw all markets, right?
In some ways that Thomas Peterffy fellow has a career to envy.
Non founders like Eric Schmidt are not recognized.
Not talking about Eric Schmidt specifically, but this list seems to irrationally over allocate value creation to founders rather than the team that supports them?
How is the "Multiple" column calculated? Is it wealth created "For Others" / "Self"? I can't get to that number for anyone if this is the formula. And Elon Musk's mutliple looks downright wrong if he created $357B for others and $917B for himself with a multiple of 1.4×
What do the minus numbers signify?
First line in the article:
> Each figure is the shareholder wealth a founder’s company created, now held by index funds, pensions, employees and co-founders, minus what the founder kept.
At a glance, this seems heavily recency-biased and not adjusted for inflation. I would expect a lot of other names that predate the 21st century to be on the list. The methodology page doesn't even contain the word 'inflation'.
Personally, I thought the list was about the criteria for wealth creation—like a standard for discovering the most valuable knowledge, technologies, or research papers. But it turns out it's just a slightly different rich list. So what value did Buffett actually create?
I was expecting to see a list of technologies like Linus's Linux or the transistor, but it's just a list of rich people.
The strangeness of capitalism seems to be that it misjudges value that hasn't been financialized.
I think the title is misleading—I should probably correct it to something like:
'A list of donors who contributed a lot of dividends and capital gains to Wall Street pension funds and index funds.'
I like the effort.
It needs some improvement.
Elon musk is among the top of the list. He is also the founder of companies that created and advanced a lot of technological wealth in the world. A huge contribution.
But it's far from certain that the recent SpaceX stock will create a lot of wealth for retail owners. Maybe even the opposite.
Which companies are those?
SpaceX is the only one I know that he founded and which, through their satellite network advanced "technological wealth".
Also this lists definition is:
> "Each figure is the shareholder wealth a founder’s company created, now held by index funds, pensions, employees and co-founders, minus what the founder kept."
How should this even remotely apply to Elmo?
[delayed]
Are these all one person shops?
That's news to me
> It’s not a claim that one person built the company alone.
I'm no economist but I'm having a hard time grokking any meaning out of this metric.
So if Elon decided to sell all his shares today (and likely destroy his companies in the process), he'd shoot to the top of the list? What's the point in that?
My 401k has benefitted from the growth of e.g. Amazon for sure, but the main 'wealth' I get from them is my ability to buy anything and get it delivered in a day. That is, I benefit from their infrastructure existing, regardless of who the shareholders are.
> So if Elon decided to sell all his shares today (and likely destroy his companies in the process), he'd shoot to the top of the list? What's the point in that
It looks like the methodology involves subtracting the founder's entire net worth, so selling the shares would leave him in the same place.
Hmm you are right. But looking closer at the methodology, I find myself even more confused.
It seems the metric is something like "most successful stewards of shareholders' investments" which I guess is interesting. But now I'm tripped up on why the metric would only consider founders rather than CEOs more generally. Imagine Gates didn't start Microsoft, but instead became its CEO a month after some other founder started it and that founder sat on the beach in Hawaii while Gates did well, what he did. The founder would appear on this list but not Gates.
Edit: basically, all my intuitive "this doesn't make any sense" alarm bells are going off, but I think I need someone who really knows what they're talking about to help me understand exactly why, or what would be a more sensical version of this