Last week Forbes magazine published its annual list of the world's billionaires. On that list was our own Rich DeVos, co-founder of Amway, whom Forbes credited with a net worth of $3 billion. That's a lot dough, folks ... if it's there.
The dirty little secret behind these richest-this and richest-that lists Forbes regularly compiles is how much guesswork goes into its estimations of these fortunes. Sometimes, it pretty easy. For example, Bill Gates owns Microsoft, a publicly traded company. So take Microsoft's stock price times the number of shares Gates owns -- voila! -- you got a good grip on his net worth. That assumes you know how much debt Gates owes against that stock. Then there's the matter of Gates's stock not being liquid, so how much would all of that stock he owns really be worth if he tried to sell it. Hmm, maybe it's not so easy figuring out a billionaire's net worth.
So, how do you figure out the size of DeVos's fortune in a privately held company? There's not a lot of public information out there. Yet, Forbes declares the man to be worth three billion bucks. Keep in mind, people, that's net worth. That's what Forbes says DeVos is worth after subtracting all his debts from all his assets. It's a huge sum -- and it's only half of the Amway fortune. The estate of his late partner Jay Van Andel should be worth another three billion if Forbes is right.
You gotta wonder if those Amway billions are really there. After all, if Rich and Jay had $6 billion to throw around, why didn't they pony up the $14,000,000 needed to pay off their big project downtown Plaza Towers. Instead they had to sell it. I know $14 million sounds like a lot, but to billionaires it's not. To them it's the equivalent financial bite of $700 to you and me.
Similarly, the heirs of Van Andel's foundation pulled the plug on making any further contributions to the Van Andel Research Institute. The foundation was worth $150,000,000, the same as $7,500 in savings for ordinary people, so why couldn't the heirs of an estate allegedly worth billions keep donating every year a fraction of foundation's worth to their father's namesake research center?
There are other reasons to question the Forbes estimate of the Amway fortune, which we will explore in future articles. Meanwhile, keep in mind the ratios noted above when considering the millions DeVos and Van Andel donated to so-called public-private partnerships like the arena and the convention center. If they're billionaires, then that money was chump change to them. And that's setting aside consideration of the return they and their families have gleaned from business generated by these public facilities.
So how big is a billion? If you ask me, a whole lot bigger than the Amway fortune.