Bill Gates and Mark Zuckerberg both dropped out of Harvard. David Geffen went to college for only three semesters before leaving. Ralph Lauren, Ted Turner and Steve Jobs are others who dropped out before getting their bachelor’s degrees.
All are billionaires; all are college dropouts.
The actual list of billionaires has even more college dropouts. According to the Forbes 400 list of billionaires, 63 earned nothing past a high school diploma. And the bulk of these people earned their way onto the list rather than having inherited their wealth.
So what do these people do that allows them to build up such a vast empire with so little formal education? What kind of life lessons can we learn from their stories?
The Decision to Drop Out
The billionaire dropouts are obviously doing something right. When you average their net worth, it comes to $9.4 billion. In contrast, the average net worth of billionaires with PhDs is $3.2 billion.
There are also more college dropouts than PhDs on the Forbes 400 billionaire list – 63 to 21.
Why are there so many college dropouts vs. PhDs on the list?
Most people look at these numbers and argue that it is a reflection on the educational system. Perhaps the formal education system is dead or a waste of time.
It’s a simple conclusion. But like most things in life, it’s not that easy.
Pointing at formal education falls apart when you look closer at the numbers.
There are only 2.5 million people with PhDs in the United States. There are so many college dropouts that I wasn’t able to find an exact number anywhere online, but it is in the tens of millions.
You have to factor in an extremely high number of college dropouts and the relatively fewer PhDs in the country. When you take these numbers into account, you see that you’re actually increasing the likelihood of becoming a billionaire by getting a PhD.
In fact, most people who drop out of college don’t do well. Their average salary is much less than someone with a bachelor’s degree.
College dropouts becoming billionaires actually says less about the educational system than most people realize.
It’s not about education; it’s about who these people are.
The people who drop out of college and become billionaires have something about them that drives them to become successful and rich.
So what can we learn about these people that got them where they are?
The Two Types of Billionaire Dropouts
From the billionaire dropouts I’ve looked at, I’ve found that they generally land into two groups.
The first group left college because they had a specific product or business plan they wanted to pursue. They had a vision of what they wanted to do and didn’t want to wait until after graduation to take action on it.
These are highly innovative people who clearly knew what they were going to do once they stopped going to school. People like Mark Zuckerberg and Bill Gates who formed Facebook and Microsoft respectively fall into this category.
Some people in this group were already making a lot of money off their ideas before leaving college. Michael Dell was already selling about $80,000 worth of computer kits a month before he dropped out of the University of Texas.
This group mostly relied on vision and innovation to drive them. They knew what they wanted to do, already have the skills to do it and didn’t want to wait for a college degree.
The second group didn’t leave college to form a business or product right away. Their path was similar, but different. They established themselves in lucrative industries and worked their way up. After several years of hard work and a few well-timed risks, they formed their own companies.
People in this group include David Geffen who worked in the entertainment industry for ten years before starting Asylum Records. Ralph Lauren worked in the fashion industry as a salesman before opening his own store and finally a successful menswear line.
After Ted Turner left Brown University, he worked at his dad’s advertising company. When his dad died, Ted took over and built the company up even further. He diversified into radio stations, then television stations including CNN and even the Atlanta Braves baseball team.
This group hustled their way to success. They found lucrative industries with vast potential for growth and put themselves right into the center of them. Once they gained enough experience, clout and power, they made a series of well-timed risks that paid off.
Both of these groups tend to have these characteristics:
- Clear vision for their future
- Know what they want to do and where to go
- Strong work ethic/Hustle
- Want things done right away
- Risk-taking attitude
- Innovative or willingness to disrupt the status quo
- Good decision-making skills
You can see the hard work ethic in Ralph Lauren when he strived to sell his first design to Neiman-Marcus. It’s also there in Mark Zuckerberg as he built up Facebook.
Ted Turner disrupted the status quo through innovation by establishing CNN, the first 24 hours news network. Bill Gates and Steve Jobs are also renowned for this trait.
The fact is that all of these billionaire dropouts share most or all of these characteristics to some extent.
They used these powerful characteristics to their advantage. It made them a formidable presence in their industries. None of them might have actually had a formal college education, but they had already learned this lesson: how to get places.
photo credit: Tetsumo