According to Bloomberg, Gates estimated net worth as of January 2021 is $132 billion. This makes him the world’s third-richest man after Elon Musk of Tesla and Jeff Bezos of Amazon. He has remained on the Forbes list of the wealthiest people in the world since 1987.
Founder of the world’s largest PC software and a successful entrepreneur, Bill Gates has remained to be an inspiration to many people in the world. In this article, we will explore more about Bill Gates, his early business life, and the lessons that we can learn from his investment strategies.
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How It All Started
Gates met his partner Allen at Lakeside school. Although Allen was two years his senior, the two became friends and worked on programs during their free time. The two went to different colleges but later dropped out and this is where they developed an interest in changing the world of computers.
In 1975, Gates and his partner Paul Allen launched Microsoft Corporation, which later grew to be the largest PC software company in the world. In 2001, Gates stepped down from the day-to-day functioning of Microsoft and took the position of chief software architect. He then officially left Microsoft in 2008 to concentrate on the Bill & Melinda Gates Foundation, which is U.S.’s largest charitable foundation.
The foundation welcomes other billionaires to pledge to the philanthropy cause worldwide. He is a renowned philanthropist who is very passionate about educating others.
As someone who has managed to accumulate a lot of wealth in his lifetime, there is so much that any new or experienced investor can learn from Bill Gates.
10 Ways to Become Successful Like Bill Gates
Below are some important lessons and pieces of advice from one of the smartest and greatest minds in the world of business.
- Start as Early as Possible and Learn
One lesson that we can learn from Bill Gates’ success is to get in early and learn as much as you can. Starting early allows you to become molded early and become successful much earlier than others.
At just the age of 13 years, Bill Gates was already learning the computer system. He was even excused from attending the regular math classes so he can learn how to program.
- Be Patient
If there is something that Bill Gates teaches us is to never fast forward our way to success. He admits that patience is a key element of success. Through patience, Bill Gates and Paul Allen were able to build the Microsoft empire.
This is despite starting on a shaky foundation and encountering a lot of challenges. Even if you fail, keep trying and don’t give up on your idea. The key is to be patient and consistent with what you are doing, and you will eventually become successful.
Also, without patience, you are likely to make investment blunders. People who buy stocks while intending to make a quick buck are more likely to get burned than those who take a long-term approach.
While you may not get the gains for your investment right away, practicing patience will see you get substantial gains in the long run. Taking the time to load up quality stocks will set you on the path to success.
- Learn From Your Mistakes
Any investor or business person that wants to see growth must always be willing to learn from their mistakes. While it is good to celebrate success, it is more important to learn from your mistakes and failures.
This is especially true on the investment front since there are chances of both gains and losses. Take note of any investment blunders that you make or have made in the past and heed the lessons. You will only grow from them when you acknowledge the mistakes rather than pretend they never happened.
According to Bill Gates, the success of the Microsoft Corporation was due to the willingness of the leadership to recognize mistakes. Learning from our mistakes can help us avoid more costly mistakes in the long run.
- Establish a Good Team
Bill Gates has indicated that having a team of talented and intelligent people is important for the success of a business. His Human Resources is determined to hire passionate individuals who are not afraid to face new challenges.
Let your team understand your goals and vision and motivate them to achieve them. Not only will this make your employees happy but also grant you success.
- Enter Into Partnerships
Similarly, Bill Gates believes in partnering with the right people. He partnered with Paul Allen while still in high school and this eventually led to the formation of Microsoft. He also partnered with Steve Ballmer and Monte Davidoff, who all contributed to his success.
When asked about the best decision he ever made during an interview, Gates was quick to reply that it was picking the right people for the job. He also mentioned that choosing his partner and Microsoft co-founder Paul Allen was one of the most important decisions he ever made.
From this, we can learn that it is important to choose the right people and partners and even appreciate them for their efforts.
- Always Trust Your Judgment
When you have an idea or vision, always believe and trust in yourself no matter what others think. In your journey of life, you will encounter many people who will disappoint or discourage you simply because they don’t share your vision.
This is the same case with Bill Gates when he first came up with the idea of Microsoft. He believed that computers would become ubiquitous, in a time when they were very rare. Although his idea was considered impractical, Gates believed in himself and what he envisioned. The result is the formation of the world’s largest PC software company.
Learn to listen to sound advice without distrusting your judgment. Keep pursuing what you believe in even if others abandon you along the way.
- Know Your Competitors and Learn from Them
Bill Gates developed a habit to visit his competitor’s websites in the morning. Also, as you acknowledge your competitors, always seek to learn from them. Appreciate that they are doing better than you and take the lessons that you can from them.
- Enjoy What You Do
You will have more success as an entrepreneur when you enjoy what you do. Let your goal become your passion and pursue it at all times. By focusing on what you enjoy, you will be motivated to give it your best and this will grant you success in the long run.
- Work Hard Without Excuses
There is no denying that Bill Gates is not only smart but also very hardworking. In his 20s, Gates admits that he never took a day off. While it is not easy, starting early and giving it your all will enable you to accumulate more money. As a result, you will have a lot of it when you are older.
- Don’t Neglect Your Personal Life
Although Bill Gates worked hard to be where he is now, he never neglected his personal life. He spent plenty of time with his family and continued reading books as his hobby. Most people’s lives revolve around their work and they don’t get to enjoy doing other things.
However, we learn that personal life is also very important. This is a good rule to adhere to for anyone that wants to be a successful entrepreneur.
Where Does Bill Gates Invest His Money?
Being among the richest men on the planet, it is only normal to wonder where Bill Gates places his money. Well, Gates has mastered the art of diversification and has made several investments.
The majority of his financial assets are held in his investment company, Cascade Investment LLC. The company has a well-diversified portfolio.
He is also known for funding worthy causes like the Bill & Melinda Gates Foundation, which is the largest charitable foundation in the USA. According to the U.S. Securities and Exchange Commission, the following are some of Bill & Melinda Gates Foundation’s prominent holdings.
- Berkshire Hathaway, Inc
This company takes the first position of being the most prominent holding of the Bill & Melinda Gates Foundation. The Foundation holds about 50 million shares that have a market value of over $7 billion.
Gates was on the company’s Board of Directors up until March 2020. Berkshire Hathaway has a $522.43 billion market cap. It was even ranked 6th in the Fortune 500 list for 2020.
- Waste Management, Inc
This is the Foundation’s second most prominent holding, with over 18.6 million shares that have a market value of $1.97 billion. The company is the largest waste management company in the country with a market cap of over $49.73 billion and more than 20 million customers. It provides numerous environmental services like waste management.
- Canadian National Railway Company
This is the Foundation’s 3rd largest holding, with over 17.1 million shares that are valued at $1.51 billion. The company mainly deals with transporting petroleum products, metals, coal, automotive products, and fertilizers. Its market cap is $74.1 billion.
- Caterpillar Inc
Caterpillar Inc, which manufactures heavy equipment for agriculture, mining, and energy, takes fourth place in the Foundation’s portfolio. The Bill & Melinda Gates Foundation has over 11.2 million shares in the company that is valued at more than $1.42 billion. The market cap of Caterpillar is $77.52 billion.
- Walmart Inc
Walmart is Gate’s 5th most recent investment, which accounts for 7.48% of the Bill & Melinda Gates Foundation Trust portfolio. This retail giant has stores and operations throughout the world and its market cap is believed to be $407.25 billion. The company increased its digital sales during the COVID-19 pandemic.
Other stock holdings for the Gate’s foundation include:
- FedEx
- Ecolab
- Apple Inc
- Crown Castle International
- Alibaba
- com Inc
- Twitter, Inc
- Uber Technologies
- Liberty Global plc
- Alphabet (GOOGL)
- Alphabet (GOOG)
- Boston Properties Inc
- Grupo Televisa SAB
- Schrodinger, Inc
- United Parcel Service
- Voya Asian Pacific High Dividend Equity Income Fund
- Liberty Latin America Ltd
- Coca-Cola FEMSA SAB
Other than investing in Corporations, Bill Gates also invests in property. He has used his money to buy real assets like a private island and an expansive estate.
Tips for Investing Your Money Like Bill Gates
There is a reason why Bill Gates has remained one of the world’s richest people. Being a savvy investor, Bill knows how to invest his money. Here is what we can learn from Bill Gates’ investment habits:
- Always Diversify
Every investor that wants to secure their money and increase their investment like Bill Gates must know the secret of diversification. Although Gates initially accumulated his wealth from Microsoft, he later sold some of his shares and invested his money into a well-diversified portfolio that his investment firm, Cascade Investment LLC, manages.
Since 1994, Gates has sold almost $40 billion of his Microsoft stock as a way to diversify his investment. Well, it is believed that his net worth would be about 4 times his current wealth if he didn’t sell some of his Microsoft shares. However, Gates understood that diversification is what protects the entire investment portfolio.
Therefore, any investor looking to make it big must follow the rule of diversification. By building an investment portfolio, you can also be at peace knowing that your lifestyle won’t be affected much should one business decline.
One of the biggest mistakes that most people make is to make their business their single biggest asset. If all of Gate’s fortune was invested in Microsoft stock, he would surely lose his money if Microsoft closed due to one reason or another. Hence, diversification is a key lesson for every experienced and aspiring investor.
- Take Big Risks
Diversification also involves taking big risks that other investors may shy away from. You should be willing to take some risk if you are looking to grow your wealth. For instance, while many shy away from the stock market because of its volatility, it is worth taking the risk if you want to win big. You just need to use the right strategy like buying quality stock and holding them for a while.
- Hire an Investment Professional
To successfully diversify your portfolio, you need an investment professional that can help manage your money. Although knowledgeable with computer software, Bill Gates understood that he needed someone to manage his investment empire.
It is for this reason that he hired Michael Larson, a renowned money manager. Since 1994, Larson has been the chief investment officer for the Bill Gates fortune and The Gates Foundation. Originally, Larson managed about $11.5 billion of the Gates fortune.
Since he was hired, he helped grow Gate’s net worth from $5 billion to what it is now. Gate has given him the authority to purchase and sell investments as he deems fit. According to Gates, Mr. Larson makes it possible for him and his currently divorced wife to pursue their vision and sleep well at night.
That is why you need to hire someone you can trust to manage your money as you focus on other important things. Of course, this should be the case only if you can afford an investment manager.
- Save Like a Pessimist
Basically, pessimism brings the awareness that a bad thing can happen. There, the best way to prepare for this is by increasing your savings such that you will overcome the unexpected event or obstacle with ease.
Since Bill Gates started Microsoft, he always insisted on having enough cash saved in the bank to sustain the company for 12 months without revenue. From this, we can gather that saving like a pessimist in the short run can make you an optimist investor in the long run. The more you stock in the short run, the easier it will be to keep going in the long run amidst challenges.
- Invest Like an Optimistic
When it comes to investing, the rule of pessimism changes. You should invest like an optimist and not a pessimist. This means that you should be very optimistic with your investing and even when the investing front is pessimistic.
As aforementioned, be willing to take risks and believe that the market will do well than it currently is. Having an optimistic mindset will push you to make investments even where others are shying away, and this could be very rewarding in the long run. Most investors, including Bill Gates, use this trick to reinforce their long-term financial security.
Conclusion
Truth be told, there is a lot to learn from a savvy investor like Bill Gates. Whether you have been investing for years or you are a new investor, heeding to the above tips will help you make smart investment moves. Learning a thing or two from this acclaimed investor and businessman will surely set you on a rewarding path of success.
Related: Elon Musk Investments: How to invest like Elon Musk.
