It pays to have founded KKR.
The legendary buyout firm’s three founders, Henry Kravis, Jerome Kohlberg and George Roberts, have once again made Forbes’ annual list of the richest people in the world.
Both Kravis and Roberts, ages 61 and 60, respectively, are reportedly worth $1.5 billion (€1.1 billion) each, which puts them at 437th on the list. Kohlberg, 79, who left KKR in 1987 to found his own private equity firm, Kohlberg & Co., is only worth $1 billion, which doesn’t even put him in the top 600. He’s number 620.
The three private equity mavens are joined on this year’s list by 60-year old Thomas H. Lee, founder of the Boston-based private equity firm that bears his name. With a reported net worth of $1.2 billion, Lee comes in at number 548.
Although a number of billionaires listed by Forbes are affiliated with private equity firms, only Kravis, Kohlberg, Roberts and Lee made their fortunes in the leveraged buyout industry.
Yet times are not as rosy for these LBO veterans as their ten-figure fortunes may suggest. In addition to encroaching hedge funds, a more efficient private equity market and a dearth of investment opportunities that can be leveraged at 10 times cash flow, the rest of the world is getting richer faster than they are.
Four years ago, Kravis and Roberts, with the same reported net worth, were more than 100 spots higher on the list, coming in at 336. Kohlberg has seen any even bigger drop in his ranking, falling from 490 in 2001 to his current status 130 spots lower.
According to Forbes, the number of billionaires they were able to document grew from 587 in 2003 to 691 in 2004, with a collective net worth of $2.2 trillion, $300 billion more than the prior year.
Once again topping this year’s list, Microsoft founder Bill Gates. With a net worth of $46.5 billion, Gates has now held the title of world’s richest person for the past eleven years.