The Rise of “New Money”: How Billionaires Are Destroying Old Money Traditions
In the world of wealth, a distinction has long been drawn between the old money aristocracy, with its inherited fortunes and genteel manners, and the brash new money entrepreneurs, who have clawed their way to the top of the financial ladder.
The traditions and customs of old money have held sway for centuries, shaping the contours of high society and the mores of its denizens.
Yet now, we find ourselves at a critical juncture, a moment of transition, as new money billionaires in the world of tech and modern finance emerge and begin to disrupt these long-established norms.
In today’s episode at Old Money Luxury, we shall delve into the manner in which these nouveau reesh magnates are reshaping the traditions that have for so long governed the world of old money.
To grasp the future trajectory of wealth and influence, it is of paramount importance that we understand this ongoing metamorphosis and the implications it bears upon our society.
1. The Rise of New Money Billionaires
The emergence of new money billionaires can be traced to the explosion of technology and the birth of novel industries that have revolutionized the global economic landscape.
This swift and sweeping transformation has given rise to a pantheon of self-made tycoons who have seized the reins of fortune and garnered immense wealth from the very industries they have helped to forge.
Let us consider three crucial two-year periods where these soon-to-be boys of billions seized upon the financial reins of what would become the new money class that would challenge the old money traditions:
Between 1995-1996, the dot-com boom was in full swing, fueled by the rapid growth of the internet and the World Wide Web. Companies like Amazon, founded by Jeff Bezos in 1994, and eBay, founded by Pierre Omidyar in 1995, began to revolutionize online retail and commerce.
As a result, entrepreneurs like Bezos and Omidyar became some of the first internet-era billionaires.
From the years, 2004-2006, we saw the rise of social media and the creation of new platforms that would transform the way people communicate and share information.
In 2004, Mark Zuckerberg founded Facebook, which quickly became the largest social media platform in the world. Around the same time, the launch of YouTube in 2005 by Steve Chen, Chad Hurley, and Jawed Karim introduced a new way to share and consume video content.
The success of these platforms led to their founders accumulating immense wealth and joining the ranks of new money billionaires.
During the same period of rapid technological advancement, Elon Musk emerged as a visionary entrepreneur, already knees deep in tech influence due to his help in shaping the future of PayPal a few years earlier, as Musk would go to reshape industries like electric vehicles, space exploration, and renewable energy. In 2004, he joined Tesla as an early investor and became its CEO, revolutionizing the automotive industry.
Lastly, in the timeframe between 2007-2009, the smartphone revolution began, driven by the introduction of Apple’s iPhone in 2007 and the subsequent launch of the App Store in 2008.
This technological leap forward led to a new wave of innovation and the creation of countless apps and services that have since become integral to modern life.
The era also saw the rise of companies like Uber, founded by Travis Kalanick and Garrett Camp in 2009, which disrupted the traditional taxi industry.
These developments ushered in a new generation of billionaires, such as Apple’s late CEO Steve Jobs and Uber’s founders, who capitalized on the growing smartphone market and the opportunities it presented.
In other countries, the rise of a “new money” money class that would supplant the old guard elite was also occurring during this time.
During the 1990s, after the collapse of the Soviet Union, the Russian economy underwent a rapid and chaotic privatization process.
This period saw the emergence of a small group of wealthy businessmen, known as the Russian oligarchs, who acquired significant stakes in the country’s major industries such as oil, gas, and telecommunications.
A few prominent examples include Roman Abramovich, owner of the Chelsea Football Club and a major stakeholder in the steel and mining company Evraz, and Mikhail Prokhorov, a former owner of the Brooklyn Nets and a billionaire with interests in various industries, including metals and media.
Additionally, the discovery of vast oil reserves in Saudi Arabia in the 20th century generated immense wealth for the nation, and a select few individuals capitalized on this newfound prosperity.
Saudi billionaires like Prince Al-Waleed bin Talal, a global investor and the founder of Kingdom Holding Company, and Mohammed Al Amoudi, an Ethiopian-Saudi business magnate with investments in oil, construction, and real estate, exemplify the new money class in the country.
Lastly, in recent decades, China has experienced unprecedented economic growth and development, transforming it into a global powerhouse.
This rapid expansion has given rise to a new class of wealthy entrepreneurs who have seized business opportunities in various sectors such as technology, real estate, and manufacturing.
Some notable examples include Jack Ma, the founder of Alibaba Group, a multinational conglomerate specializing in e-commerce, retail, and technology; Pony Ma, the founder and CEO of Tencent, one of the world’s largest internet and technology companies; and Wang Jianlin, a real estate tycoon and founder of the Dalian Wanda Group, one of the world’s largest commercial property developers.
As these new money billionaires accrue staggering wealth, their influence upon the global economy and society at large becomes ever more pronounced.
No longer content to simply amass fortunes, they leverage their resources to enact change, to bend the world to their visions of progress, efficiency, and connectivity.
II. The Disruption of Old Money Traditions
As these new money billionaires rise to prominence, the landscape of philanthropy undergoes a commensurate transformation.
The old money gentry, guardians of tradition, have long funneled their largesse through venerable foundations and charities, institutions that have stood the test of time and come to represent the very essence of noblesse oblige.
Such institutions have shaped the priorities and contours of giving for generations, focusing on the arts, education, and healthcare, among other causes.
Yet, as the mantle of wealth shifts, so too does the approach to philanthropy. The new money titans, impelled by their innovative spirit, seek to forge their own path in the realm of giving.
They eschew the established conduits of philanthropy, preferring instead to create bespoke initiatives that reflect their individual ethos and aspirations.
They target issues that resonate with their own experiences and values, such as climate change, technology, and social justice.
This realignment of philanthropic focus has far-reaching implications for the societal causes and funding priorities that once held sway.
For instance, MacKenzie Scott’s grant-making efforts focus on addressing social inequality and racial justice, while Bill Gates’ Breakthrough Energy Ventures focuses on clean energy innovation, and Mark Zuckerberg’s Chan Zuckerberg Initiative concentrates on improving education and health outcomes.
Parallel to this philanthropic upheaval, the social domain experiences its own metamorphosis.
The old money class has long maintained a network of exclusive social clubs, bastions of privilege that have served as the locus of power and influence for generations. Within their hallowed halls, alliances are forged, and deals are brokered, all under the watchful eye of tradition.
However, the ascent of new money billionaires signals the waning relevance of these august institutions.
Unencumbered by the strictures of old money social norms, these entrepreneurial trailblazers create their own networks and gatherings, tailored to their unique sensibilities and ambitions.
Events such as TED Talks and the Summit Series supplant the traditional clubs as the epicenters of influence, fostering an atmosphere of innovation and collaboration that stands in stark contrast to the staid, hierarchical world of old money.
As the guardians of tradition yield to the vanguard of innovation, the realm of wealth management and investment also undergoes a seismic shift.
Historically, “old money” adhered to time-tested investment approaches, such as investing in blue-chip stocks like General Electric or acquiring prime real estate properties in Manhattan.
These well-established strategies, albeit less dynamic, have offered stability and consistent growth for generations.
In contrast, the “new money” billionaires eagerly embrace disruptive technologies and startups, such as financing electric vehicle companies like Tesla or supporting cryptocurrency ventures like Ethereum.
These investments, though laden with risk, hold the promise of exponential returns and the potential to transform entire industries.
As “new money” billionaires allocate their vast resources to these ventures, they not only disrupt traditional investment paradigms but also redefine the very essence of wealth creation.
III. The Blending of Old Money and New Money Cultures
As the tides of fortune shift and the worlds of old and new money collide, a curious amalgamation of cultures begins to emerge.
In this brave new world, we witness the merging of disparate spheres, as new money billionaires and old money families alike seek to adapt and assimilate the customs and practices of one another.
On the one hand, the new money billionaires, eager to establish their own credentials within the elite circles of high society, begin to adopt certain old money traditions.
They acquire historic estates and properties, those prestigious edifices that have long been the bastions of privilege and power.
For instance, Russian oligarch Roman Abramovich purchased the Château de la Croë on the French Riviera, Saudi oil tycoon Prince Al-Waleed bin Talal acquired the historic Savoy Hotel in London, and Chinese billionaire Wang Jianlin bought the 17th-century Edificio España in Madrid.
Furthermore, new money billionaires immerse themselves in the world of fine art, collecting masterpieces that not only serve as markers of wealth and status but also as tangible links to the cultural heritage they seek to embrace.
They participate in high-society events, mingling with the scions of old money families, forging connections, and alliances that transcend the boundaries of their respective realms.
Conversely, the old money families, aware of the changing dynamics in their environment, start to adapt to the new money influences that increasingly pervade their sphere.
They adopt technology and innovation, acknowledging the significant impact these elements have on the worldwide stage. They collaborate with new money billionaires on philanthropic projects, building alliances that span the divide between convention and ingenuity.
For instance, the Rockefeller Foundation partnered with Jeff Bezos to address climate change, while the Ford Foundation joined forces with the Bill and Melinda Gates Foundation to improve global health and education.
In this age of flux, the blending of old and new money cultures heralds a new chapter in the annals of wealth and power, as the erstwhile guardians of tradition and the vanguard of progress forge a path forward into an uncertain but undeniably dynamic future.
