From unearthing crypto-billionaires to exposing financial shenanigans, in chronological order, Forbes’ 18 greatest hits of 2018.
Forbes’ First List Of Cryptocurrency’s Richest: Meet The Secretive Freaks, Geeks And Visionaries Minting Billions From Bitcoin Mania
The craziest bubble ever has created billion-dollar fortunes. Meet the freaks, geeks and messianic visionaries who scored cryptocurrency riches.
When Forbes set out to find the richest people in crypto, we knew the technology’s decentralized nature—and the wild valuation swings—would make it a tall task. But with blockchain technology here to stay, it’s safe to say some of these names will be around for a long time to come. “We had to draw on a wide range of experience and skills, from our decades-long work valuing private companies to new tricks for analyzing digital wallets,” says Staff Writer Jeff Kauflin. “It was the most challenging reporting I’ve ever done.”
The American Dream is alive and well on Wall Street thanks to Robert Smith, the richest black person in America, who has figured out a way to reengineer both private equity and enterprise software—and used this secret playbook to build a $4.4 billion fortune.
“I spent two years trying to get Robert Smith to speak with me about his business,” Senior Editor Nathan Vardi says. “He was clearly the most interesting story in private equity, but he was reluctant to speak. He finally agreed to meet me in Miami on a Saturday in January with his partner, Brian Sheth. Once we finally got to talking, Robert just went on and on. It was one of my favorite interviews in 20 years as a reporter.”
Angered and frustrated by tech’s suffocating old boys’ club, a group of elite venture capitalists are channeling emotion into action. Their weapons—investing and entrepreneurship—provide a blueprint for how to transform any crusty industry from the inside out.
“When I first got a cryptic email from one of the founders of All Raise in December 2017, the group didn’t have a name, and no one knew who was involved outside the group, but I still got that tingling any reporter knows when they sense they’re on the track of a special story,” says Associate Editor Alex Konrad. Adds staff writer Biz Carson: “It wasn’t until we sat down with group and shadowed them that I realized both the depth and scale of their ambitions.”
Matthew Mellon’s death in Mexico raises many unanswered questions, including what will happen to the estimated $500 million of XRP digital currency he owned. “I am trying to live a responsible life,” he told Forbes earlier this year.
“When I spoke to banking heir Matthew Mellon in January 2018, it was clear that his large holding of the cryptocurrency XRP made him feel vindicated. He told me he was fighting his substance-abuse demons and was proud to have personally earned a fortune,” Vardi recalls. “Three months later, Mellon was dead. He died in Mexico, where he was experimenting with hallucinatory therapies that are illegal in the U.S. It was sad reporting on the days leading up to his death.”
Quietly, without fanfare, an under-the-radar foundation in Silicon Valley has grown to become larger than household names like the Ford Foundation and the Rockefeller Foundation. But despite the outward appearance of success at the charity, which has focused on growth in assets above all else, inner turmoil abounds.
“The sad irony of this story is that the Silicon Valley Community Foundation was set up to support groups helping those in need in the Valley, and it ended up being an awful place to work for so many people,” says Assistant Managing Editor Kerry Dolan. In June, after substantiating claims of sexual and workplace harassment by the charity’s number two executive that helped lead to an “unhealthy workplace environment,” the foundation’s board announced that CEO Emmett Carson was out.
From humble beginnings traipsing through California’s vast forests with his dad to salvaging wood from forest fires, Red Emmerson has built a logging empire by being cheaper and more aggressive than his rivals.
“I spent days driving through public land that Sierra Pacific Industries had logged after a forest fire and couldn’t possibly have prepared for how apocalyptic these areas looked,” Staff Writer Chloe Sorvino says. “It was simply shocking.”
Bill Austin built a fortune from medical devices, then set out on a crusade to help the poor hear. But while he was off hanging with movie stars and rock gods, his company descended into a cesspool of fraud, embezzlement and betrayal. A cautionary tale of a second act to do good—gone woefully bad.
Staff Writer Michela Tindera went to Minneapolis to hear billionaire Bill Austin’s witness testimony against former executives he accused of stealing more than $20 million from his company. “There was hardly a dull moment during his days-long testimony,” Tindera says. “Austin knows how to captivate an audience.” And the story has kept evolving in the months since. Just a few days ago the former president of the company was sentenced to seven years in prison.
Papa John’s founder John Schnatter’s alleged behavior ranges from spying on his workers to sexually inappropriate conduct, which has resulted in at least two confidential settlements.
“The entire story started when I received a tip on Twitter—from someone unaffiliated with Papa John’s—who sent me a link to a 1999 lawsuit against John Schnatter. I figured it was worth a few calls to former employees. I heard enough during those conversations to keep reporting and ultimately reached out to more than 150 people,” Reporter Noah Kirsch says. “After we published, Schnatter resigned as chairman, and two other executives mentioned in the piece have since been pushed out. If nothing else, this story reveals the power of individuals who speak up.”
If even half of the accusations are legitimate, the current United States secretary of commerce could rank among the biggest grifters in American history.
“I’ve been writing about Wilbur Ross for about a year now, covering all sorts of financial shenanigans involving millions of dollars. But a lot of that stuff is hard to understand. I’m convinced this story caught people’s attention because of one simple detail: Former colleagues said the commerce secretary used to steal Sweet’N Low packets. Everyone knows a guy like that,” says Associate Editor Dan Alexander.
Not even 21, Kylie Jenner has built a $900 million cosmetics fortune, with virtually no employees, capital or expertise. This new model of extreme fame leverage is radically reshaping business, culture and politics.
“The Kylie Jenner story involved a lot of driving,” recalls Associate Editor Natalie Robehdemed. “Sixty miles to Oxnard, California, to peek around the laboratories where Kylie Cosmetics are produced. And 30 miles to Kris Jenner’s home for an interview with Kylie and Kris at her palatial white home.”
“Fittingly, I was driving and listening to the radio when I first heard Travis Scott’s (now multi-platinum) single “Sicko Mode,” in which he references the controversy caused by Jenner’s Forbes cover. I did not expect the story to create as much of a stir as it did—I thought folks would be interested by the structure of her barebones business, but the backlash it received from critics who disputed Jenner’s self-made status was fascinating. I think the story sparked a necessary conversation about wealth and status in America and shined a spotlight on the way social media is shaping our economy and society.”
Eren Ozmen and her husband spent the last quarter a century carefully building Sierra Nevada from a tiny, 20-person defense firm into a multibillion-dollar aerospace concern. Now she’s betting their fortunes on the billionaire space race.
“Ozmen and her husband had never done an in-person interview before, but the minute we sat down for drinks the storytelling began. Ozmen worked as a night janitor and sold baklava to put herself through grad school and went on to build a multibillion dollar aerospace and defense company with husband Fatih,” says Staff Writer Lauren Debter. “Their sense of patriotism was what perhaps struck me the most and was the lone reason given for why they have spent three decades equipping the U.S. military and now are helping America reestablish its leadership in space.”
The never-told story of how an unlikely group of billionaires and politicians quietly passed a law that revolutionizes investment in struggling regions—and offers one of the greatest tax-avoidance opportunities in American history.
“I ping-ponged from the heart of Silicon Valley, to the inner chambers of Republican and Democratic Senators, to long neglected neighbors in Charleston, South Carolina, and Newark, New Jersey,” says Senior Editor Steven Bertoni. “The response was as varied and far-flung as the research, drawing questions and curiosity from a diverse range of readers across regions and industries: wealth managers and lawyers, builders and fledging founders—all looking for ways to get into the Opportunity Zone action.”
America’s most innovative—and feared—business leader is coming off a three-year run that has him the richest person of all time. Now he tells Forbes he’s only begun to grow. Corporate America, you’ve been warned.
Forbes’ chief content officer sat down with the richest man in the world to talk Amazon’s unprecedented ascent. Bezos’ innovative growth plan should give every CEO in every field pause: “The market size is unconstrained.”
Millions of tweens play video games on Roblox’s website. That’s not unusual for a social gaming unicorn. What is unusual: teaching kids the rudiments of coding and paying them like entrepreneurs.
“My favorite part of reporting this story was tagging along with a group of kids and their parents on a tour of Roblox HQ. To me, things didn’t look much different than the office of any other software development company—but for the kids, it was like touring Willy Wonka’s factory,” says Associate Editor Alex Knapp.
Exclusive: WhatsApp Cofounder Brian Acton Gives The Inside Story On #DeleteFacebook And Why He Left $850 Million Behind
Facebook’s blockbuster $22 billion WhatsApp purchase instantly made Brian Acton one of the richest people in America. But as with his Instagram peers, his idealism clashed with Mark Zuckerberg’s financial juggernaut, leading to perhaps the most expensive moral stand in history. For the first time, Acton explains why he walked away from $850 million.
“Putting the story together was a stressful process,” says Staff Writer Parmy Olson. “We knew it was going to shine a negative light on the inner workings of Facebook and reveal some new information—for instance, that Facebook misled European regulators about its intentions to link user accounts. But the public reaction was incredible, from dozens of news articles to praise on social media for Brian Acton’s brutal honesty to a public rant from one of Facebook’s top executives. Since then, there have been more revelations about Facebook’s data practices that underscore why our interviewee quit when he did.”
Donald Trump’s White House tenure—and his polarizing politics—has actually dented his net worth. But it’s not for a lack of trying to cash in.
“Ever since Donald Trump entered the Oval Office, the whole country has been wondering whether he was making money on the presidency or not, and this was the first story to really answer that question,” says Alexander. “We dug deep,” adds Associate Editor Chase Peterson-Withorn. “We interviewed nearly 200 of Trump’s colleagues, partners and industry observers since the election. Ultimately we came away with a fascinating—and counterintuitive—result.”
Exclusive: In-N-Out Billionaire Lynsi Snyder Opens Up About Her Troubled Past And The Burger Chain’s Future
At 36, billionaire heiress Lynsi Snyder has already struggled through her father’s tragic death, three failed marriages and a battle with alcohol and marijuana. The devout Christian eventually found stability running In-N-Out, her family’s quintessential West Coast burger chain, and now she’s determined to protect it at all costs.
“Lynsi Snyder rarely lets journalists into her world. I expected her to be a bit guarded. But she opened up almost immediately about what she’s gone through,” says Sorvino. “I was surprised when she started tearing up while speaking about her father’s legacy, but soon realized that’s where her strength lies as a leader—in sharing her vulnerability with others. It’s only made her a stronger president. In-N-Out’s cult following is all the better for it.”
Two decades ago, Joe Liemandt became the youngest member of The Forbes 400 by building a software juggernaut. He’s quietly bigger than ever, with a far darker model.
“Joe Liemandt is the J.D. Salinger of software,” Senior Editor Nathan Vardi says. “He disappeared from public view after being a tech celebrity in the 1990s. But I discovered he had spent the last decade building a massive software empire, buying U.S. software companies and turning them into cash machines by replacing employees with closely monitored foreign contract workers paid by the hour,” says Vardi. “In reporting on Liemandt, I felt I was getting a glimpse into the future of skilled labor.”
- Michael Noer Forbes Staff