For the longest time, Bill Gates was the richest man in the world. At the time of this post, Bill is the 4th richest person in the world with a net worth of $134 billion according to the Bloomberg Billionaire Index.
As great an achievement that is, Bill could have done a lot better. In fact, he would have been the world’s first trillionaire had he not done this.
Divesting His Microsoft Stocks
At the time of Microsoft’s IPO on March 13, 1986, Bill owned 11,142,000 shares, or 44.8% of the company.
Since leaving MS, Bill has divested his Microsoft holdings from 44.8% down to just 1.3%. He used the proceeds to diversify his portfolio and became the largest private farmland owner in the United States. All together, this portfolio of investments equals $134 billion. But what would have happened had Bill just kept his MS stocks?
He Would Be The World’s First Trillionaire
In the 35 years since Microsoft became a public company, its stock has split nine times. If you have one MS share at the IPO, you would have 288 share today. That means Bill’s 11.142 million shares of Microsoft would become more than 3.2 billion shares todays.
Shares of Microsoft are right now trading at $309.25. Multiply that by 3.2 billion shares and you have $993 billion. Add in the $7.958 billion that MS would pay Bill in annual dividends and you have the world’s first trillionaire.
All this what if is a pretty moot point, and I’m sure Bill isn’t losing sleep over it. After all, what you can buy with a trillion dollar that you can’t buy with $134 billion?
If You Had Invested $5000 At MS IPO
The trillion dollar figure is Bill’s number, but here’s a cool little take away. If you had invested just $5000 during the Microsoft IPO, you would have got 238 shares at the IPO price of $21. After the nine stock splits, you would own 68,544 shares today, which would be worth over $21 million. You would also be receiving almost $170K a year in dividends. Try not to lose sleep over that.