How to manufacture a billionaire childhood

**SPEAKER_1** (0:00)
I got something, Shaan. Do you want to hear a story?

**SPEAKER_2** (0:02)
Does it have to do with those glasses?

**SPEAKER_1** (0:04)
No, but I am a cool guy, so that's why I decided to wear them. I have one interesting thing that I could bring up.

**SPEAKER_2** (0:19)
Let's do it.

**SPEAKER_1** (0:20)
Billy of the Week. We haven't done that in a minute. I have an interesting person.

**SPEAKER_2** (0:24)
Billy of the Quarter, I guess.

**SPEAKER_1** (0:25)
Billy of the Quarter.

**SPEAKER_2** (0:26)
Haven't done this in a while.

**SPEAKER_1** (0:27)
Well, it's the Billy of this week. We don't do it every other week. Have you heard of a guy named Jim Ratcliffe? Sir Jim Ratcliffe?

**SPEAKER_2** (0:35)
No, I don't know who that person is.

**SPEAKER_1** (0:37)
Okay, so listen to this. Here's a story of this guy named Jim Ratcliffe. He's really interesting to me. He's born in Manchester, England, which is sort of like a blue collar. It's kind of like the Boston of America, of England. It's like white blue collar, hardworking kind of poor. He studies chemical engineering. He becomes a chemical engineer at an oil company, but things are only going okay. And then he has a background in accountant, accounting. He studies accounting and chemical engineering in college. And he gets a job at a PE firm at the age of 35 And he's like, this is pretty amazing. Like, you know, this is a great way to make money. I like making money. But at the age of 40, he was like, all right, I've worked for another guy for long enough. I want to try and do this on my own.
He doesn't have a ton of money.
I think he had a home that he owned and he had like 100 or 150 grand to his name. This was in the late 80s. He partners up with a guy and they're like, okay, we've been buying companies for our employer, the firm that we worked for. Let's try and do it on our own. They convince some of their old clients, some of their old LPs to invest in them. They spend about a year looking for a company.
With three million pounds in equity, they buy a 80 million dollar, 80 million, I'm gonna say dollars, but I mean pounds, but 80 million dollar company that is a spinoff of BP. Basically, BP, the oil company owns a chemical division, which basically makes chemicals, so the commodity that, let's say, your toothpaste has fluoride in it, well, someone has to get the fluoride, whatever it is, the chemicals that make plastic packaging, whatever. They buy that unit from BP for 80 million dollars, which 3 million dollars was equity and the rest was debt, so like a really heavy debt thing, and he mortgages his home. He uses 100 percent of his money. He has two kids and a wife, and he was like, my wife, we talked about it for six months, like, should we do this? Is this like, this can ruin us, this is going to ruin our careers, this is going to, we're going to use all of our money, but you know what? We have to take a risk. And so he does that in 1990, I believe, and by 1997 it works. This 80 million dollar company is now worth like a billion and a half. And that's how he makes his initial money.
And over the years, he's kind of kept that one thing. I think it's called INEOS is the name of the company. It's a chemical company that you probably have never heard of. But to this day, or today, it does about 40 billion dollars in revenue, employs many tens of thousands of people. It's one of the largest chemical companies in the world at this point. And basically the way that he's grown is a combination of PE and his chemical engineering background. So he understands chemicals, but his whole schtick was finding like spinoffs that conglomerates didn't want to own anymore because it was a distraction. He would buy it for whatever he would pay for. And his goal was to double the EBITDA in five years. That's like sort of standard stuff. That's kind of the boring thing that he did. But now at this point, he's, I think, the number one or number two or three richest person in England. Amazing. But the more interesting part, in my opinion, is what he has done with his money. So check this out. Do you remember the two-hour marathon with Ilud Kipchoge that Nike did like four years ago?

**SPEAKER_2** (3:48)
Yeah. Did we have recently, right?

**SPEAKER_1** (3:50)
Well, someone actually just broke two hours recently. But like four years ago or three years ago, there's this amazing runner named Ilud Kipchoge, and they set up like the world's perfect setup for him. So they have like a pace car that was like perfectly in front of him, that went on pace for an hour, 59 minutes. They did it on an F1 track, so it was perfectly flat. They let him wear shoes, or he decided to wear shoes that weren't technically allowed in sanctioned races, but he was like, this is just a spectacle, let's do it. And so he broke two hours in the marathon. Well, Jim Radcliffe is a huge sports nut. He's run 50 marathons. He's gone to the North Pole, the South Pole. He's climbed all these mountains. He's like one of these crazy guys, and he was the underwriter of that. He paid for the whole thing, just because. He also owns a ton of different sports leagues. So he owns Team Sky Cycling. So that's the team that won the Tour de France eight times.