Right now, more than any other time in history, it's crystal clear that wealth isn't earned - it's created.
If you've read any financial guide or self-help money book in the last twenty years, you're probably familiar with this lesson. Plugging away diligently at your 9-5 job, socking a bit into savings each week and maybe putting an extra payment here or there down on your mortgage is never going to make you rich.
No, the wealthy are incredibly skilled at doing something the working class aren't quite as awesome at: getting out of their own way and letting their money make money by creating incredibly valuable businesses.
New insights from PitchBook highlight several tech companies that experienced hockey stick-like growth in 2014 and epitomize the concept of wealth creation. We're talking five-digit growth figures and tens or even hundreds of millions of dollars in increased valuation - every day.
The big winner identified in their research was Uber, the disruptive transportation brand making waves in cities worldwide, with their incredible $120 million daily growth in value:
Between financing rounds in June and December 2014, Uber's valuation appreciated at a rate of $.7 million per day... then $5.5 million... then $46.3 million... and its meteoric rise continued, finally reaching an astonishing $120.4 million increase in valuation per day in December, resulting in a total valuation of $40 billion by year's end.
Uber wasn't the only tech brand that had a really, really awesome 2014, though.
Snapchat, the popular and sometimes controversial photo and messaging app, grew at a rate of $22.7 million per day from February to December last year.
Pinterest grew by $15.3 million a day in the year from May 2014 to today. Airbnb, who came along just in time to revolutionize the hospitality industry, grew $14.8 million per day for quite an extended time, from December 2012 to April 2014. And cloud-based SaaS brand Zenefits grew its valuation by $10.2 million a day from June 2014 to this month.
Pretty impressive, right?
So it takes money to make money. No, that doesn't mean you have to be a millionaire to get started. I bootstrapped my company, WordStream Inc., using my earnings as a digital marketing consultant to get it off the ground. It wasn't easy, but it's possible. That was only in 2007 and now WordStream is worth many millions of dollars.
I say that not to brag, but to hopefully serve as inspiration for aspiring entrepreneurs and early-stage startup founders.
In WordStream's earliest days, I was the lowest paid person in the company within the first ten hires. Pretty much every penny went back into the growth of the business. In 2008, we received out first round of funding and though there's much more to the story, we've grown steadily ever since and are one of the fastest growing companies in Boston!
When you put your wealth to work for you, it generates more wealth - this is how these five companies ended up generating a massive $183 million in value per day.