How Chamath Palihapitiya made a billion-dollar fortune
Chamath Palihapitiya is one of the most famous and successful investors of modern times. In 2023, his capital was worth USD 1.5 billion. He was instrumental in the creation of Meta Corporation and also founded his own venture capital firm, Social Capital.
Early career
Chamath was born in Sri Lanka. His family moved to Canada when he was six years old. After graduating from university with a bachelor’s degree in electrical engineering, the young man decided to pursue a career in technology. Chamath Palihapitiya started his career at AOL and the Mayfield Foundation, but as Vice President of Development at Facebook, he really came into his own. During his time there from 2007 to 2011, Palihapitiya significantly increased the social network’s user base and introduced monetisation features to the platform. As a result, the company’s revenues and share price increased many times over.
Building social capital
In 2011, Chamath left Facebook and decided to focus on the investment sector. Having amassed a solid fortune, he and his wife set up their own company, Social Capital. The venture capital fund invested in IT startups focused on solving social problems. The entrepreneur invested in such well-known companies as SurveyMonkey, Slack and others. After Slack’s IPO in 2019, Chamath’s stake in the business exceeded USD 1 billion.
It’s worth noting that Palihapitiya doesn’t just know how to pick promising startups to invest in. He also has a strategic vision for the development of the company, within which he builds a strong team capable of leading the business to success.
Chamath Palihapitiya’s working principles
Chamath’s venture capital fund participated in the funding of SpaceX. He was also one of the first to believe in the prospects of cryptocurrencies and invested in Bitcoin. Palihapitiya himself explains his success by following certain rules:
1. Invest in promising projects in the early stages of their development. This has been the case with SpaceX and Bitcoin, which have ultimately yielded significant profits.
2. A diversified portfolio of investments helps reduce risk.
3. The courage to take risks and the ability to be open to new projects and ideas.
4. Look for new ideas that will lead to progress.
5. Investing in ideas you believe in is better than those currently popular.
6. Failure helps you succeed.
Using a SPAC played an important role in Chamath’s capital increase. The investor is an advocate of this model of taking companies to market. Palihapitiya invests in exciting start-ups through the SPAC mechanism, including Virgin Galactic and Opendoor.
