1 of 1 Musk, Zuckerberg and Bill Gates: Why tech billionaires will be ‘poorer’ in 2023 Photo: Reproduction Musk, Zuckerberg and Bill Gates: Why tech billionaires will be ‘poorer’ in 2023 Photo: reproduction
Of those powerful, only Larry Ellison made more money between 2022 and 2023. Ellison is a cofounder of software company Oracle and is worth $107 billion today, up from $106 billion in 2022.
What happened?
The tech sector has the greatest potential to create billionaires, but it’s not immune to economic uncertainty. “When the economy is bad, companies’ coffers take a hit, and that also affects the wealth of their executives. This creates a domino effect,” explains Joelson Sampaio, Professor of Economics at FGV EESP.
For experts consulted by g1, Three factors have driven the decline in tech billionaire wealth:
- 🦠 Covid19 Pandemic: At the beginning of the health crisis, digitization increased. With everyone staying at home, governments gave financial assistance to people who spent more online. As a result, technology companies grew and had to hire more employees to keep up with high demand. But this growth did not last after the easing;
- 🌍War in Ukraine: Russia is one of the world’s largest energy suppliers, and with the start of the war, the West stopped buying gas and oil from Vladimir Putin’s country. But this embargo helped boost inflation around the world. “Energy increased and pushed up inflation, which ultimately increased the costs of doing business,” explains Leonardo Trevisan, Professor of Economics and International Relations at ESPM. The economy, already affected by the pandemic, has deteriorated;
- 💸 Higher interest rate: In order to curb rampant inflation, the central banks of several countries increased their key interest rates. The move negatively impacted sales, and companies scaled back their online advertising spend to cut costs. “But digital advertising is the main source of revenue for ‘big techs,'” says Trevisan.
Mark Zuckerberg has lost more money
A comparison with the Forbes figures for 2021 shows that most billionaires made more money in 2022. But a significant drop is attracting attention: Mark Zuckerberg. His net worth has dropped from $97 billion in 2021 to $67.3 billion in 2022.
“During the tough phase of the pandemic, everyone made big investments, but the economy fell,” says Leonardo Trevisan of ESPM. “Despite the power they have, they are all companies like any other and they also face difficulties,” he concludes.