Connect with us

Entrepreneurs

Bill Gates Gets Why People Are Doubting Billionaires—And He Has A Defense (Even For Mark Zuckerberg)

mm

Published

on

The once and future richest person in the world (once the Bezos divorce finalizes), Bill Gates will happily apply the dispassionate, sharp-elbowed logic that made him one of the most fearsome business minds of the past century—even when the subject, abstractly, is him, as well as the other, suddenly unpopular members of the Three Comma Club.

“I think it’s fascinating that for the first time in my life people are saying, ‘Okay, should you have billionaires?’ ‘Should you have a wealth tax?’ I think it’s a fine discussion.”

It’s a discussion that took place yesterday just a block from Trump Tower, home of America’s first-ever billionaire president. “My opinion is that there should be an estate tax and maybe even higher than we have today. Among The Forbes 400, I don’t think we’d get a majority—Warren [Buffett] and I are sort of against interest on that,” says Gates. “So I think there’s plenty of debate about how capital should be taxed, how estates should be taxed.”

READ MORE | Jeff Bezos Says National Enquirer Owner Tried To Blackmail Him

But as for the kind of disincentivizing economics lamented by the Beatles in “Taxman” and increasingly championed by America’s far left, Gates remains clear: “The idea that there shouldn’t be billionaires—I’m afraid if you really implemented something like that, that the amount you would gain would be much less than the amount you would lose.”

In looking at how Gates now deploys tens of billions philanthropically—both the money he and his wife Melinda put into their eponymous foundation, the world’s largest, and that given and pledged by Buffett—it’s critical to understand that perspective.

Just as Gates views, correctly, that a tax system moving from progressive to confiscatory creates less wealth and innovation overall, he and Melinda examine issues systemically.

“It’s more evocative to say you’re saving one life than to say you’re saving a million,” he says. “It’s a weird thing.”

That worldview comes through in the 2019 edition of the Gateses’ annual letter, released this morning. Ostensibly, this year’s letter, which lays out their philanthropic observations and priorities, focuses on nine surprises that have inspired the Gateses to take action. In reality, it’s a valentine to the power of philanthropic investment—the idea of giving not to salve problems, but to solve them.

“I think it’s fascinating that for the first time in my life people are saying, ‘Okay, should you have billionaires?’”

The Gateses write about Becoming A Man (BAM), a group counseling program that helps teenage boys stay in school by channeling their anger. (Bill Gates says he had a “touching experience” sitting in on a group, and even took his turn to vent—about learning that global polio cases were going up.)

And their “toilet fair” in Beijing, designed to inspire a next-gen toilet that can alleviate sanitation issues. Their fixation on Africa, whose young population promises to transform the global labor force.

All of these initiatives tell a similar story. They’re about “picking novel ideas” or “off-the-wall theories,” as Gates says, and then proving that the concepts work. “Once you find a solution and want to scale that up, it’s usually government money.”

That’s a sticking point when dysfunctional Washington can’t enact even the most obvious forward-thinking policies. Take foreign aid, less than 1% of the U.S. budget and an expenditure that, since the Marshall Plan, has consistently generated positive ROI, in terms of creating stability and vital trading markets and stemming deadly diseases.

While Congress rejected President Trump’s proposed foreign aid cuts, Gates remains worried. “It just can’t be ignored, given the intensity of political debate over domestic issues—and if you have one party saying, ‘Hey, helping foreign countries, that’s kind of a sucker’s deal, does it even benefit us?’”

This shortsighted nationalist streak is a global issue. “We’re very worried that if Brexit goes poorly, at least for a time, [the U.K.] might not see [foreign aid] as a priority at all,” he says. “If the French domestic stuff gets too painful, will they stay generous?”

In education, Gates has faced similar headwinds. “You get into political policy things in terms of what you’re trying to achieve. It’s tricky.” The most obvious example here: his previous battle for the Common Core education standards, which critics like Diane Ravitch undermined by terming such efforts a “billionaire boys club.”

READ MORE |Facebook Profits Defy Critics – Zuckerberg Vows Company Has Changed

“The attack that ‘Why should you even have a say in setting the agenda?’—that has a certain resonance to it,” admits Gates.

So why should billionaires get to choose what problems we’re solving?

“Philanthropy is there because the government is not very innovative, doesn’t try risky things and particularly people with a private-sector background—in terms of measurement, picking great teams of people to try out new approaches,” says Gates. “Philanthropy does that.”

Philanthropy, as practiced by the Gateses, also takes risks in the existential terrain political leaders would rather bury their heads in. Bill Gates still worries about nuclear proliferation, an area his partner-in-crime Buffett has championed. He’s been the global leader on the risks around pandemics and also, to a lesser degree, climate change, where his $1 billion Breakthrough Energy Ventures fund makes big bets.

Artificial intelligence looms on the horizon as the newest threat brought on by innovation. “In the long run,” says Gates, “AI is a tough problem.”

Notably, Gates does not feel that way about social media. Last century’s boy wonder, who faced scrutiny for what the federal government saw as Microsoft’s monopolistic tactics, clearly has empathy for this century’s boy wonder, Mark Zuckerberg, now a lightning rod for Facebook’s role in the erosion of democracy, as most recently outlined by Facebook investor Roger McNamee.

“I think what Roger [McNamee] has said is completely unfair and kind of outrageous,” says Gates. “They’re blaming Mark for everything. I mean, Trump was not elected because of Facebook. They say ‘filter bubble.’ All these polarization things. … Well, be clear. I get to read whatever I want to read, I get to listen to right-wing radio, I get to listen to Fox News. You kill Facebook and I can still live in my filter bubble. But filter bubble is not just my Facebook feed, so acting like, ‘Hey Mark, wake up someday and solve the filter bubble problem.’ No, Roger McNamee has no practical solution to the filter bubble thing.”

“They’re blaming Mark for everything. I mean, Trump was not elected because of Facebook.”

(“It’s hard when you’re in this vortex,” adds Gates. “I was in such a vortex once upon a time. A little bit different because mine was more of a court-related thing than the broad view of whether the software was good or not.”)

Ultimately, Gates, whose net worth, even after large donations to the foundation, approaches $100 billion, views philanthropy as a vital force for good. And he thinks that potential critics—even a loony potential British prime minister—will come around to that view.

“When I met with Jeremy Corbyn for the first time, does he view me as the billionaire guy who collected more money than he thinks anybody is supposed to collect?” recalls Gates.

“Or does he view me as the philanthropist who’s helping improve Africa and hopefully learn about education? Fortunately he was very nice, he viewed me as the second. But I’m sure he had to hesitate: ‘This guy is one of those people that maybe there should be none of’.”

-Randall Lane, Forbes Staff

Continue Reading
Advertisement
Comments

Arts

Gordon Ramsay Plots 100 US Restaurants With New Private Equity Deal

mm

Published

on

By

On a given day at Caesars Palace in Las Vegas, chef Gordon Ramsay’s eponymous pub and grill will make around $20,000 from fish and chips. The 1,200-square-foot space sees around 1,300 guests a day. Since debuting on the strip in 2012, Ramsay has added another location in Atlantic City.

Combined, both have sold more than 300,000 fish and chips dishes. “It’s taken the nation by storm. I look at the lines outside the door,” Ramsay told Forbes on the phone earlier this week.

His steak restaurant, which launched seven years ago at Caesars’ Paris Las Vegas Hotel, has meanwhile expanded to Atlantic City and Baltimore, luring diners with beef Wellingtons (more than 250,000 sold since 2012) and sticky toffee puddings (more than 200,000 sold).

That kind of demand needs to be taken advantage of quickly. Which is why a year ago, Ramsay started looking for a partner to help him rapidly expand these brands. “I wasn’t ready to pedal this bike up a hill on my own. That would take me another 15 years,” Ramsay says. “Let’s get this thing done.”

READ MORE | Taking A Bite Out Of Africa

And now Ramsay has inked a deal with Lion Capital, a private equity outfit with offices in London and Los Angeles, which has scaled restaurants like wagamama, the pan-Asian noodle chain, as well as brands like Kettle chips and Jimmy Cho. Lion now owns 50% of Gordon Ramsay North America, while the other 50% is controlled by Ramsay.

He declined to comment on the size of the transaction, but the deal stipulates that Lion will invest $100 million over five years to build an empire of Gordon Ramsay restaurants across America. The joint venture expects to open 100 new locations across the U.S by 2024. 

“I fell in love with this country 20 years ago. There’s a will here. My goal, right now, is to establish one of the most exciting food brands in America,” Ramsay says. “Being a control freak, I needed the right partner on board. There’s a lot of businesses that don’t like that kind of stranglehold. For me, the partnership was crucial.”

Ramsay already has eight restaurants across Las Vegas, Atlantic City and Baltimore in partnership with Caesars Entertainment. There’s five concepts in Las Vegas, of which three are brands that will be expanded through the new deal — Gordon Ramsay Steak, Gordon Ramsay Pub & Grill, Gordon Ramsay Fish & Chips.

“Vegas has been the most amazing platform. Everyone thinks it is just full of partying and entertainment, but it’s one of the most severe and revered culinary capitals anywhere in the world. You don’t get a second shot at it,” Ramsay says.

The restaurant concept, Gordon Ramsay Steak, launched in 2012 inside Caesar Entertainment's Paris Las Vegas Hotel & Casino on the Las Vegas Strip.
The restaurant concept, Gordon Ramsay Steak, launched in 2012 inside Caesar Entertainment’s Paris Las Vegas Hotel & Casino on the Las Vegas Strip.GORDON RAMSAY STEAK

The deal will also bring two more concepts to the U.S.: Gordon Ramsay Street Pizza and Gordon Ramsay Bread Street Kitchen, which he calls “a modern Cheesecake Factory.” It already has successful locations in London, Hong Kong, Dubai and Singapore. 

Ramsay is a six-time Celebrity 100 listmaker who earned $62 million last year, mainly from his television deal with Fox, in which he produces and stars in shows MasterChef, Hell’s Kitchen, MasterChef Jr. as well as 24 Hours to Hell and Back.

READ MORE | From Fishing Village To Gastronomic Heaven: Tables Turn For Wolfgat

“It may seem aggressive, but we’re not opening up 80 or 90 of the same restaurant. We’re crossing over with a multilayered brand. That’s the bit that I’ve worked hard at. We’ve divided and conquered.”

Ramsay’s 15 restaurants in London won’t be impacted by the Lion Capital investment. The announcement comes just a few weeks after British chef Jamie Oliver announced that all but three of his 25 restaurants in the U.K. will close.

“It’s a very oversaturated market there, and you need to be very careful with that level of expansion. It’s unfortunate to see the situation he got himself into, but that’s what happens when you’ve got a juggernaut that’s out of control, as opposed to being in control,” Ramsay says. “I’ve sat patiently, learning from other people’s mistakes.”=

-Chloe Sorvino; Forbes Staff

Continue Reading

Entrepreneurs

Pain, Poison And Potential

mm

Published

on

For a man who wanted to end his life at one time, it is quite ironic that Steve Harris is today one of Nigeria’s most successful life and business strategists.


Being born into a lower middle class family is one thing; trying to make a name for yourself after dropping out of university twice is another. That is what Steve Harris, a life and business strategist and motivational speaker, fondly known as ‘Mr. Ruthless Execution’, has accomplished.

Harris learned the sinusoidal motions of the entrepreneurship journey very early in life.

At 40, he is the Chief Executive Officer of EdgeEcution, an organization that helps high performance individuals and institutions bridge the gap between their performance and potential.

Today, he is among one of the most downloaded, quoted and followed personal development trainers in Nigeria, a feat that is outstanding when you consider that he almost committed suicide before this journey even began.

READ MORE | Executive Protection: Big Bucks, Bullets And Bodyguards

The events leading up to his worst day began to unfold when Harris gained admission into the University of Benin in Nigeria. His parents wanted him to become an engineer but his failure to attain the required grades meant he had to take the Industrial Maths class instead. That is when his emotional saga began.

“I had altercations with my lecturers and I was flunking because I was not cut out for math. I had issues with my lecturers because at the time, my department was the most corrupt department in the university and if you wanted to pass, you needed to bribe your lecturers. So they were pretty much a cartel and if you didn’t pay, you wouldn’t pass, so someone like me who at best was a C student became an F student.”

As a result, he scored 4% or 11% in his exams even when he had prepared well enough.

“I eventually got kicked out [of university] in 2004.”

Harris managed to get into a private university but this time, he was required to start all over again.

“I couldn’t go the distance and I dropped out in my seventh month. I couldn’t handle it because my mates were already working. My younger sister was also already working and I was going back to my first year of university. I started having suicidal thoughts and I couldn’t handle it anymore so I dropped out.”

Those suicidal thoughts would come back to haunt him later.

Being the first-born of three children, Harris was the one most likely to succeed. As fate would have it, his two failed attempts at university made him the black sheep of the family.

“I remember coming back home and my younger sister had graduated and my parents were super stoked, and here I am, the first child and I didn’t even get it together. Very quickly, she got a job and started earning money. She began buying things for the house and taking care of responsibilities and started giving me an allowance. I remember she gave me N10,000 ($28) and I was very grateful because I didn’t have any money,” says Harris.

“Like all African parents, my parents started complaining and reminding me about how I wasted their money and how I failed. How the children of others were working in [companies like] Shell and I was just at home.

“I would hide from friends and family members when they visited so I wouldn’t have to tell them my situation. The next month, my sister gave me N5,000 ($14) and I couldn’t ask her where the other N5,000 had gone. She was such a high-flyer that within six months, she moved into her own place and bought a car and here I am, first-born and I couldn’t even afford to buy a Christmas card,” avers Harris.

Then came the straw that broke the camel’s back.

“One day, my sister asked me to come over to her house for my monthly allowance. I went in and she had everything I wanted, she had a flat-screen TV, the whole nine yards, and I was just sitting there comparing my little sister with myself and I was thinking ‘there is no way I was ever going to catch up with her’. We were talking and in the middle of the conversation, I pissed her off and she said, ‘I am not even going to give you any more money’ and she kicked me out of her house.

READ MORE | Internet In Our Bodies?

“I felt so embarrassed and ashamed and here I was, the one who everyone thought was most likely to succeed and I was being kicked out of my younger sister’s house because I didn’t have money. That messed with my mind. I remember sitting at home and I had bought rat poison. I kept thinking that it would be so much better to die than being alive and subjected to the misery I was giving my parents,” says Harris.

As he sat down with the box of poison, mentally preparing himself to end the pain and embarrassment he had brought to his family, one of his siblings walked into the house, in the nick of time.

“That is what stopped me. Then, I also found out that if you commit suicide, you will go to hell and here I am, living my own hell on earth and if I died, you are telling me I am going to be in hell forever?”

That was the wakeup call Harris so desperately needed.

He began to work his way up, starting off with volunteer jobs such as being a church driver for his pastor and also working as an office assistant with Fela Durotoye, a management consultant and recent presidential candidate of the Nigerian elections.

Harris grew through the ranks until he became a management consultant before starting off on his own entrepreneurial journey. Amid the challenges of finding his true purpose, certain thoughts came to his mind that changed his outlook towards life forever. He began asking himself: ‘why am I on this earth?’, ‘how can I make enough money to take care of myself and my family?’ and ‘how do I use my talent to help others?’

He found the answers in books on business written by authors such as Tom Peters and Michael Porter. That is when Harris first discovered he had a penchant for success.

And with his ability to overcome failure, Harris is now on a mission to empower millennials to look inward at their strengths and inner power, and with his able guidance, build brands that can beat the odds and survive, just as he did. 

Continue Reading

Entrepreneurs

Rewriting The News On Africa

Published

on

African media can reverse the downward spiral affecting newsrooms across the continent, says APO Group chairman, Nicolas Pompigne-Mognard.


The media landscape has changed dramatically over the last decade. As a result, newsrooms have been forced to make monumental changes such as reducing the staff complement to keep up with the demands, or they have simply had to shut down.

With some African newsrooms being written out of history, there has been an emergence of international media setting up shop on the continent. This interest serves as a double-edged sword for African media that often finds itself under-resourced. 

Nicolas Pompigne-Mognard, the founder and chairman of the APO Group, is of the view that the African media landscape has faced challenges that precede digital migration, which have compounded existing problems. An incident that stands out for him, before the digitizing of media, was a lack of access to information for African reporters, and that propelled him to start one of the foremost media relations firms on the continent.

READ MORE | Why Science Matters So Much In The Era Of Fake News And Fallacies

 When he was a journalist for online publication, Gabonews, and the deputy president of the Pan-African Press Organisation in France, between 2005 and 2007, Pompigne-Mognard says this was a recurring problem hampering the productivity of African reporters. 

“If you wanted the right to attend an international press conference, you would need an official card.

“As an African correspondent, the only way for you to have that card and get access was to prove that you were getting at least €1,000 ($1,121) of earnings, and most of them didn’t have that,” says Pompigne-Mognard.

“It was rooted in disparity. If you have two journalists and one of them has the right card and the other doesn’t, then of course, the other one cannot do his job. He cannot earn money or write articles. 

READ MORE | Google, Facebook, Twitter Fail To Live Up To Fake News Pledge

“More than that, it reinforced the dependence of African media on international media. They had no other choice but to rely on the information provided by the biggest media.”

To remedy the circumstances that seemed to disempower his peers on the continent, Pompigne-Mognard founded APO from his living room, using $11,000 in savings.

APO has grown since its inception as it provides a variety of media offerings such as press releases, videos, photos, documents and audio-files.

The company has sources such as global Fortune 1,000 companies, reputable international and Africa-based PR agencies, governments and international institutions.

“I didn’t start it to make money. I didn’t start it as a business. I wasn’t an entrepreneur at the time. I was a journalist and I wanted to address a problem. At the beginning, I wasn’t even aware that companies were paid to distribute press releases.”

Pompigne-Mognard has since realized many things through the medium of his company as APO delivered growth of 60% in 2018, representing a turnover that has more than doubled in two years.

As a correspondent of Gabonews, before the inception of his company, Pompigne-Mognard was covering Europe, and he had to report Africa-related news and needed information. As a result, he would ensure he was receiving as many press releases as possible; however, this came with its own logistic challenges.

“That’s when I realized it was extremely difficult to actually ensure I received all the press releases from institutions like the United Nations, as an example. There was not one point where I could get all the African information issued by the international system. 

“Journalists had to rely on information that was on websites. It was very time-consuming to get access to all the content…

“It got me thinking about how if international media was not receiving information from our most important institutions, then what does that say about our voices in the world?”

A single conversation propelled him to make decisive change, Pompigne-Mognard says.

“I had a serious meeting with the president of the African Development Bank at the time, Donald Kaberuka, and he told me something that was instrumental because that’s when I decided I wanted to do something about it.

“What he told me is that the destination of information about African economies contributes to the growth of the continent, because at the time everybody was talking about poverty, war and struggle.”

Over the years, Pompigne-Mognard has observed a similar trend in the way press releases are compiled and disseminated.

He feels this has contributed in transforming the narrative on Africa.

“Something that is specific with press releases is that 95 percent of them convey good news. Usually, when a company issues one, it is to say that they are appointing a new CEO, they are opening a new branch, or they are expanding into new markets.

“We (APO) have been participating, for several years now, in changing the African narrative. We are in a unique place where we have a chance to influence the narrative and make sure that Africa has its own voice and is not influenced by the bias of international media.

Although information is accessible to those who seek it, he says there is currently another challenge that African media needs to resolve in order to maintain autonomy and make money to sustain itself.

“I think there is a big problem coming towards us and it is coming fast,” says a concerned Pompigne-Mognard.

“Nigeria is starting to watch more international media than the local media. Think about the international companies which are willing to expand on the continent. What if 10 years from now, the conclusion is that in the most developed economies on the continent, the nationals are watching more international media? Where exactly do we think the international companies are going to spend on advertisements?

“As an international company, why would I deal with five national TV stations in different countries, if I can approach a single international station and get, not only those five countries, but also better coverage?”

Pompigne-Mognard says the continent is ripe with potential and international media companies, which have observed the budding possibilities, are striking while the iron is hot.

“They know the population is going to grow, the middle class is growing and that purchasing power is growing.”

Finances remain a colossal inhibiter to the growth of newsrooms, as many have had to retrench to make ends meet.

The ripple effect is that the quality of the content produced eventually suffers.

“On a global scale, the media landscape is in a challenging position. It has become very difficult to finance content and to find new ways to make money. Africans also have the same challenges, but often they don’t have the same means or resources.

“I would prefer to be wrong on this matter, but if I’m right, in 15 years’ time, the media landscape in Africa will be completely different – in a bad way.

READ MORE | How New Media Platforms Have Become Powerful Across Africa

“I want Africa to have a strong media landscape. But in order to do that, people need to understand that media companies need to be run as businesses.”

But it’s not all doom and gloom for African media; Pompigne-Mognard sees hope. He says the status quo can be reversed if there is a joint effort to curb the problem. 

“One of the solutions is to create pan-African media,” he says. “The person who is going to crack the code and make it happen could be extremely rich. It doesn’t have to be [entirely] pan-African, even 30-35 countries are more than enough.

“There’s a thing about Africa which is a strength and a weakness; it’s that doing something here will always be more difficult. But the good news is that for those who manage to do that thing in Africa, they can do it anywhere.”

Continue Reading

Trending