When you think about the wealthiest people
of the world, the first people who come to mind are bill gates, Jeff Bezos, Warren Buffett,
or even this guy (Mark Zuck). But the problem is that these rankings are
made based on the publicly available information, and it doesn't include people who are much
wealthier than even Jeff Bezos. Take an example of Crown Prince of Saudi Arabia,
or MBS as he is known more famously. At 34 years old, he bought a yacht for 500
million dollars, a French Chateau for 300 million dollars. And for dessert, he purchased a 450 million
dollar Leonardo de Vincy painting. Even people like Jeff Bezos, who have been
dominating the Forbes list for a few years now, would struggle to raise so much cash
to make such extravagant purchases. It might sound like I am talking about some
kind of a conspiracy theory, but trust me, I am not. In this video, we are going to explore the
five types of rich people and why Jeff Bezos isn't the richest person in the world? Why the real billionaires are hiding behind
the curtness and would never want to be seen at the top of the Forbes list? Let's start with the poorest type of rich
people. I know that this sentence is quite controversial. But believe it or not, we have a whole segment
of rich people who appear on the Forbes list all the time but don't even have a few million
dollars. They are known as paper rich. They founded a company in silicon valley;
the company seems promising, it might be successful in the future, so investors, banks and financial
institutions in general would gladly lend them the cash they need to get to that position
and start earning money. Pretty much every startup in every silicon is like that, the company might have a great
product with hundreds of employees, but it burns more money than it brings. In fact, some of the largest companies are
still running like that, like Uber, Lyft, and even amazon as recently as a few years
ago. Amazon reported its first profitable quarter,
just in 2018. So, all of these people might claim to be
multi-millionaires or billionaires, but in reality, they probably can't even pay the
rent. Thats why they all strive to become level
2 rich. If one day, your startup suddenly becomes
popular and your net worth on paper will be, let's say 5 billion dollars. Here is a step by step guide on how to turn
your 5 billion dollars on paper into actual cash. First, do your best to create hype around
your app to boost its valuation and then take it public. During the IPO, since a lot of people will
be willing to invest in your company, sell a portion of your stake, but not too much
since that will devalue your net worth, lets 5 to 10 percent. Congrats, now you have 250 million dollars
in real money. Go and get yourself a mansion for 20 million,
a supercar you always dreamed about, keep a few million dollars in your account for
emergency cases and the rest, invest it into many different stable companies that actually
turn a profit. Forbes might estimate your net worth at around 5 billion dollars, but you perfectly know
that's not real. All you have is just a few hundred million
dollars of real wealth. Take an example of Evan Spiegel. As of 2020, his net worth is 4.3 billion dollars. He should also be able to buy a yacht for
500 million dollars and a mansion in France for 300 million dollars, especially since
he holds French citizenship. But he can't, this 4.3 billion dollars is
only on paper, from his stake in Snapchat, in practice, he can't even get half of that. Snapchat is a huge company and makes a lot
of money, but Snapchat has never made a profit. It has been two years since it went public. With 218 million users, it's valued at around
31.5 billion dollars, and Evan's net worth primarily comes from his 18 percent stakes
in the company, so even though he is a billionaire, he can't afford a 500 million dollar yacht-like
MBS. Of course, you can argue that he can suddenly
sell his shares and raise billions of dollars in cash, right? Theoretically, yeah, but in practice, not
really. If he suddenly sells a large portion of his stake, there will be an oversupply of
Snapchat shares in the market and will drive the price down, which means his net worth
will be much lower. On top of that, if the founder and the person
who runs Snapchat will suddenly start selling his shares, investors will lose confidence
in the company. They might decide to sell their shares as
well, which can result in the crash of the entire company. Jeff Bezos, who is the richest person in the
world, according to Forbes, is also in this category. Let's say you have had a successful IPO and
raised hundreds of millions of dollars. How do you turn the other 4.75 billion dollar
net worth into real wealth? Here is your step by step guide. Keep growing your company, but at the same
time, sell a small portion of your shares every single year and invest them into many
profitable companies. In 10 or 15 years, you will successfully diversify
your portfolio and will no longer be a cashless billionaire. The best example of someone who successfully
did this is Bill gates. He is famously known for building Microsoft,
but today Microsoft makes only a small percentage of his portfolio; in fact, his biggest stake
is in Berkshire Hathaway, a conglomerate that holds many different companies under its wings. So if Microsoft shares suddenly drop. His wealth won't be affected at all since
his wealth comes from many different companies from all around the world and from many different
industries. Another example is Travis Kalanick, the founder
of Uber. Uber has been around since 2009, but it still
hasn't turned a profit, and in 2019, it went public. Travis Kalanick, one of the founders of the
company, slowly sold off almost his entire stake and diversified his portfolio even before
the company made a dime in profit. What could be better than having a net worth
of 5 billion dollars that's diversified into many different companies where interest alone
probably brings you around 500 million dollars, you don't have to touch the principal (wealth)
at all because interest alone will provide you unbelievable lavish life. However, the next type of rich people are
one step ahead, and they are heads of states. In many countries around the world, some individuals
rise to power and then consolidate the power around themselves and hold on to it until
the end of their lives. And while they are in power, they have the
entire wealth of the nation at their disposal, yes of course, you might have angry journalists
throwing at you uncomfortable questions, but you can always use that wealth to prevent
that from happening. Take an example of former Lybian president
(Gadaffi) who had an estimated nextwroth of 200 billion dollars, or the president of russia,
who is in power for 20 years already and recently changed the constiiton of the country to stay
in power for another 20 years. The entire nation has to pay taxes, and
you can do with that cash whatever you wish, or the profits from the natural resources
will be under your country. You can have as many private jets as you wish
or yachts or whatever else you desire. But this type of wealth is not sustainable. At some point, the people of your country
will get bored with you and would protest to replace you. And the Arab spring is a perfect example of
that, where many heads of states that were rulling their nations for 30 or 40 years were
overthrown and replaced. Qatar is an oil-rich country that has probably
the highest GDP per capita in the world. Emir Tamim bin Hamad Al Thani rules it. The Constitution of this oil-rich country
basically says: the Emir or the head the country can only be chosen from the family of Al Thani
and he is the head of the state and the commander-in-chief of the Qatar Armed Forces and guarantor of
the Constitution. So no matter what he does, how much money
he spends, how many palaces and private jets he buys, he can't be taken down, he can spend
the nation's wealth as he desires. But most importantly, his son or one of his
sons will be the next King of Qatar. And that is the ultimate level of wealth where
you own an entire country. And Qatar isn't the only example, Saudi Arabia,
UAE, Jordan are the neighboring countries will similar structures of power. In the UK, the queen is the head of the state
and commander-in-chief of the British Armed Forces, and The Government of the United Kingdom
is known as Her Majesty's Government. She might not control the government directly,
but the taxpayers still have to pay for her lavish life, and her entire family's expenses
that are not cheap and anyone born into this family will automatically be super-wealthy. You can find similar examples in other European
countries, in Africa, Asia, and pretty much in every continent. Royal blood is considered privilege and people for one reason or another , in general,
would treat you as someone blessed by God himself if you are linked to a royal family. That's why history is filled with examples
of royal dynasties; people respect and admire royal families and considered them upper-class
citizens. Thats it for this video. If you want to support our channel, then check
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