3 Million Americans Got Rich From Boring Businesses. Here's How, with Owen Zidar & Eric Zwick
Afford Anything | Get Smarter With MoneySummary
Around 3 million Americans own private businesses, collectively worth more than ten times the entire Fortune 500. Recent research by Owen Zadar, an economics professor at Princeton, and Eric Zwick, a finance professor at the University of Chicago Booth School of Business, reveals that many of these business owners are everyday millionaires, running companies in sectors like pest control, dental practices, and car dealerships. Their findings challenge the common perception that wealth in America is primarily held by high-profile figures like Elon Musk or Jamie Dimon, highlighting instead the significant wealth generated by private business ownership.
The study emphasizes that most successful entrepreneurs do not come from affluent backgrounds. Instead, they often start from humble beginnings, learning their industries from the ground up before launching their own ventures. Many of these business owners are in their late 50s or early 60s and have built their wealth incrementally over decades. The research suggests that aspiring entrepreneurs should consider acquiring existing businesses, particularly as many baby boomer owners are looking to retire without a succession plan. This approach allows new owners to benefit from established customer bases and operational systems.
Zadar and Zwick also discuss the importance of profitability and reinvestment in early business stages. Successful entrepreneurs often prioritize keeping their businesses lean and avoiding excessive debt, allowing them to navigate risks without jeopardizing their financial stability. They recommend that individuals interested in entrepreneurship start small, run experiments, and maintain a safety net through savings or a W-2 job while exploring business opportunities. Ultimately, the data underscores that while entrepreneurship can be challenging, it remains one of the most viable paths to significant wealth in America.
Show Notes
#761: Roughly 3 million Americans who own private businesses — car dealerships, beer distributors, dental practices — are collectively worth more than ten times the entire Forbes 400. Most of them didn't start rich, and you've probably never heard of a single one.
Economists Owen Zidar (Princeton) and Eric Zwick (University of Chicago Booth School of Business) spent more than a decade linking anonymized tax records to the people who own America's private businesses. They share what they found in their new book, The Everywhere Millionaire.
In this episode, we discuss: Why owning all of a small business can rival owning a sliver of a startup Which unglamorous industries quietly produce the most wealth How to decide whether to buy an existing business or start your own How retiring owners and seller financing (paying the owner back over time) open doors for buyers How to run cheap experiments so no single failure wipes you out When to double down on one business versus diversify What the data says about whether you need to be born rich
If you're weighing a steady paycheck against owning something yourself, this conversation shows who actually takes that path, what it demands, and how often it pays off.
⏱️ TIMESTAMPS Note: Timestamps may vary slightly depending on dynamic ad placements. (02:20) Why 3 million business owners outweigh the Forbes 400 (06:13) The overlooked businesses behind America's quiet fortunes (11:22) Why retiring owners could be your buying opportunity (17:31) Own all of something small, not 2% of a unicorn (21:36) Buy a business or start one? (29:24) How to fail small without getting wiped out (34:35) What yacht and private jet data revealed (44:20) Most successful founders didn't grow up rich (01:06:31) Double down or diversify once it works? (01:18:51) Should you leave a high-paying job for this?
🔗 RESOURCES MENTIONED 👉 Buy a retiring owner's business or build your own? Find the ownership path that fits your money and risk: https://affordanything.com/fiire 👉 The Everywhere Millionaire (book): https://link.amazon/B04y1xfaU 👉 The Everywhere Millionaire on Substack: https://everywheremillionaire.substack.com 👉 The Millionaire Next Door, by Thomas J. Stanley and William D. Danko: https://link.amazon/B01HtGgHg
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