Gautam Adani: From college dropout to world's second richest man

TechNews Writer
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Mon Sep 19, 2022

We frequently read or hear stories about billionaires who left college early to start successful businesses, from Steve Jobs and Michael Dell, to Bill Gates and Mark Zuckerberg. The proportion of college dropouts on the billionaire list is abnormally high. Although these success stories are outlandish, they have one thing in common: they all took place in western nations, and specifically in the United States of America. Not only does this simplify the path because there are more opportunities, but it also means that the consequences of failing are not as severe. In the worst case, you can just work as a burger flipper at McDonald's to make ends meet. However, considering the fierce competition for even entry-level positions in many Asian nations like India, you may wind up homeless if you don't succeed with your business and don't have a degree. Despite this, an Indian man named Gautam Adani was prepared to leave high school and college to pursue his aspirations. And just this week, Adani overtook Jeff Bezos becoming the second-richest person in the world. This is the story of how a college dropout ended up being the wealthiest guy in Asia.

Adani was born in Ahmedabad, India, on June 24, 1962. Adani's father was a local textile merchant; this tells us he should have had a good financial background. The issue was that Adani had seven siblings, so his father's typical income didn't go very far. His father's small business probably affected the family's fundamental beliefs despite not having much money. Generally, a college education in India is regarded as the holy grail. Those who don't go the conventional route face severe stigma.

However, it appears that Adani's father's business made the family more receptive to taking alternate routes. This was very significant given that Adani had hated school since he was a child. He had very little interest in academics and didn't think a school would help him achieve his goals. He left high school at 16 and relocated to Mumbai to try his hand at business. He only had a few hundred Indian Rupees (INR) in his pocket. It's unclear what exactly he attempted to accomplish in Mumbai. Still, it seems to have been a major failure given that Adani returned to his native state, Gujarat, and enrolled at Gujarat University, which is renowned for offering highly liberal admissions. In other terms, Adani enrolled in a community college.

This didn't matter because Adani dropped out two years later, at 18. With a few hundreds of rupees he returned to Mumbai, but this time he was prepared. Adani went on and obtained a position as a diamond sorter at an exporting business called Mahendra Brothers. Despite the low salary, this employment gave Adani insight into the diamond industry, which he would later use to launch a diamond flipping business. This proved pretty successful and brought in a significant sum for Adani. Although he couldn't quit working, he was no longer concerned about how he would pay his bills. While this was going on, one of his brothers, who was equally entrepreneurial, established a small plastics plant and invited Adani to join him. Adani accepted the offer since he didn't want to flip diamonds for the rest of his life. Still, he never invested all his money in his brother's company. Small profit margins and intense rivalry made the plastics industry exceedingly cutthroat. Adani didn't want to start a plastics company, but he immediately saw a stronger possibility in the sector. Adani thought that all of their Poly Vinyl Chloride (PVC) suppliers were doing considerably better than them since PVC is one of the essential elements needed to make plastic. Adani, therefore, traveled to South Korea to meet with PVC manufacturers and negotiate an import contract.

In 1988, Adani officially established Adani Exports Limited. Adani founded the company with 500,000 rupees (INR), roughly $36,000 at the time. Initial business operations involved importing PVC and selling it to nearby plastic industries, but Adani quickly began to expand. The Indian government started establishing laws that were far more friendly to businesses in 1991, changing their attitude toward commerce. For instance, they relaxed banking regulations and loosened licensing requirements and tariffs. This phase is now recognized as India's economic liberalization. The timing of all these regulations allowed firms to grow more quickly. It brought a flood of cash to the Indian economy, which was perfect for Adani.

To extend the business into trading metals, textiles, and agricultural commodities, Adani moved ahead and used these policies. A few years later, India allowed private businesses access to the Mundra shipping port, in 1995 Adani was awarded the contract. The Mundra port has since grown to be India's biggest private port. Adani opened a power plant in 1996 as a swift response to this success, and by 1998 the Adani Group was India's top net earner of foreign currency. Despite his accomplishments, Adani hadn't even started working in the coal industry, which was his most lucrative sector. Due to the prohibitive start-up costs and monopolistic nature of the sector, coal has historically had a high barrier to entry.

On the other hand, you would be well taken care of for decades if you could unseat the existing coal boss. Since Adani was fully aware of this he waited until 1999, when he was prepared to enter the market. Adani soon entered into a collaboration with the Wilmar Group, a well-known business in Singapore. Together they established a partnership known as Adani Wilmar, solidifying Adani's place in the major leagues. However, you must deal with big issues when you play at big levels.

Being killed and/or held for ransom is one of many billionaires' top worries. Due to this, many billionaires invest millions, if not tens of millions, each year in security. To lessen the possibility of being assassinated they also engage in a number of peculiar rituals. One of the flashiest billionaires around is Donald Trump, for instance. You would assume that Trump enjoys fine dining and upscale establishments, yet he often chooses fast food eateries. He believes the risk of being poisoned is significantly lower if he turns up at a fast-food restaurant haphazardly than if he booked a reservation at a fine restaurant. This is ironic in a good way, but it's a price you frequently have to pay to rise to the top. Adani may not have paid much mind to these warnings, but it soon became apparent that he ought to have.

When Adani and one of his friends, Shantilal Patel, tried to leave the Karnavati Club in 1998, a group of guys held them up at gunpoint. The two were taken somewhere secret after being coerced into getting into a van. Thankfully, the group didn't intend to murder Adani. They were there for nothing more than his money, and they were free as soon as he gave them $2 million. Two thugs named Fazl-Ur-Rehman and Bhogilal were subsequently connected to the kidnapping. After this episode, I'm sure Adani was much more cautious.

Still, 10 years later he would have yet another near-death experience. This time, though, it took place within the Taj Hotel, one of India's most wealthy and upscale locations, rather than on the country's streets. The Taj Hotel was among the targets of a string of terrorist assaults on November 26, 2008. Ten terrorists attacked the Taj Hotel, killing dozens of people and holding the other guests as hostages. Adani was at the Taj Hotel during the incident and claimed to have seen death from a distance of 15 feet. Fortunately, the hotel personnel acted bravely in guiding the remaining attack victims to the basement and then a chamber hall where they found cover. They remained here for the following two and a half days until, on November 29, 2008, the National Security Guards of India entered the Taj and eliminated the terrorists. 

Adani has made notable contributions to the community in several fields. For instance, he started free schools around India, giving 100,000 disadvantaged kids access to education. Recently he has also made an effort to lessen his detrimental effects on the environment. Adani promised to invest $10 billion in renewable energy over the following three years in the summer of 2022. And even that is only a small portion of his pledge to invest $70 billion in renewable energy by 2030. It is encouraging to see that Adani is mindful of his future environmental impact, even though this obviously does not undo all of the harm he has done in the past.

Since June 2020, shares of several Adani firms have increased more than 1,000 percent, indicating investor confidence in the conglomerate's capabilities in sectors such as renewable energy and infrastructure, which Indian Prime Minister Narendra Modi has emphasized for development. In 2022, shares of his flagship company Adani Enterprises,have increased by more than 115 percent. Adani surpassed fellow Indian businessman Mukesh Ambani in February 2022 taking the title of the richest person in Asia.

Musk's $260 billion is still much ahead of Adani's $146.9 billion wealth, mostly comprised of the holdings of his enormous Adani Group conglomerate. The group owns and operates a variety of profitable enterprises, including ports and coal. The second-richest person in the world, Jeff Bezos, has suddenly dropped to third place as Adani quickly advances up the Billionaire Index rankings. With $260 billion under his belt, Elon Musk — still the richest person in the world —might need to be on guard. Adani started the year in 14th place, and it has taken less than 10 months to move up to the second rank. It is the first time someone from Asia has placed so well in a field historically dominated by white western tech entrepreneurs.

 

 

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2022 - Fall - Issue 2
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