The Incredible Story of how Li Ka-shing became the richest man of East Asian Descent

Hong Kong billionaire Li Ka-shing is the richest man in Hong Kong and currently tied with Wang Jianlin of Wanda Group as the richest man in Asia, with a current estimated net worth of $31.2 billion.

Li Ka-shing has an incredible rags-to-riches story. He was forced to drop out of school as a child to support his family. But today he is one of the world's richest men. He opened his first factory at the age of 22 and within a few years saw great success as a manufacturer, property developer, business magnate, and investor. He's now become a major investor in disruptive technology. He was one of the first big investors in Facebook, with big acquisitions like that of British telecom company O2, which he purchased at the end of March 2015 for $15 billion. He recently made headlines January this year 2017 with his $5.5 billion acquisition offer to Australia's Duet Group.

Li Ka-shing was saddled with financial responsibility from a young age. After his family fled to Hong Kong from southern China during WWII, his father died of tuberculosis. He had to leave school before the age of 16 to work in a factory.

YouTube/Indochink

Source: Business Insider

For almost four years during the Japanese occupation of Hong Kong, he sent 90% of his pay to his mother. Perhaps his early success as a breadwinner taught him the generous values that have made him famous for his philanthropy today.

YouTube/Indochink

Source: Forbes

Li was clearly influenced by his experience of working as a child. “It doesn’t matter how strong or capable you are; if you don’t have a big heart, you will not succeed,” he said.

Bobby Yip/ Reuters

Source: Forbes

Li showed promise as a leader and visionary when he opened his first factory in 1950, at the age of 22. The factory, Cheung Kong Industries, manufactured plastic flowers. He anticipated that plastics would become a booming industry, and he was right. Today, based in Hong Kong, the Cheung Kong Group's businesses encompass such diverse areas as property development and investment, real estate agency and estate management, hotels, telecommunications and e-commerce, finance and investments, retail, ports and related services, energy, infrastructure projects and materials, media, and biotechnology. Mr Li is a strong believer in synergy — the power of combined efforts. This belief is reflected in his naming his company Cheung Kong Holdings after the Yangtze River that flows through China, a great river that aggregates countless streams and tributaries. The Times in the United Kingdom and Ernst & Young UK jointly named Mr Li as the Entrepreneur of the Millennium at the turn of the century.

WikiMedia Commons

Source: Business Insider

Li attributes the success of Cheung Kong, which he started with only about $50,000, to a willingness to learn the latest industry trends. “The correlation between knowledge and business as the key to success is closer than ever," he said.

WikiMedia Commons

Source: The Telegraph, Evan Carmichael

Though Li dropped out of school at a young age and never received a university degree, he has always been a voracious reader and attributes much of his success to his ability to learn independently. For instance, he completed Cheung Kong's accounting books in the company's first year himself with no accounting experience — he simply taught himself from textbooks. 

YouTube/Indochink

Source: Forbes

Along with knowledge and industry insight, Li considers loyalty and reputation to be keys to success. In a 2006 interview with Forbes, he said, “Anytime I say ‘yes’ to someone, it is a contract.”

Reuters

Source: Forbes

In 1956, he once turned down an offer that would have given him an extra 30% profit on a sale (and allowed him to expand his factory) because he had already made a verbal agreement with another buyer. He still carries this principle of loyalty today, even when it means losing money.

Bobby Yip/ Reuters

Source: Forbes

Li’s first visionary move was with plastics, though he was ahead of the curve again when he moved into property development in 1979 with the acquisition of Hutchison Whampoa. This set the stage for him to become a major real-estate tycoon before Hong Kong’s global boom.

The Hutchison Whampoa headquarters.Zhongwanhang, Wikipedia

Source: Business Insider

Though he is known mainly as a property developer, Li’s companies control 70% of port traffic and most electric utilities and telecommunications in Hong Kong. He also owns a majority stake in Husky Energy, a Canadian company. Li distributes his wealth and power across different industries and geographic areas, showing that he is unafraid to learn and experiment in new arenas.

Bobby Yip/ Reuters

Source: Business Insider

Li arranges his holdings strategically to ensure his security despite the state of the economy. He anticipates economic highs and lows. “I do not get overly optimistic when the market is good, nor overly pessimistic when the market is down,” he said.

Tyrone Siu/ Reuters

Source: Forbes

Though he has many holdings, the thriftiness that was necessary during Li’s childhood has carried over into his current career. His no-debt policy means that his companies operate using as little debt as possible, and Li himself purchases all of his real estate using capital, in order to maintain zero personal debt.

Siu Chiu/ Reuters

Source: Forbes

Li’s good financial habits have given him the freedom to treat investment in technology as a “high-stakes hobby,” through Horizons Ventures Ltd. His longtime friend, Solina Chau, runs the tech fund.

LKS Foundation H.K./ YouTube

Source: Forbes

Li was one of the first big investors in Facebook and more recently invested in a startup that aims to replace eggs with a plant substitute. Li only invests in technology that he sees as “disruptive” and will make his holdings more cutting-edge. This is consistent with his constant innovation in his businesses.

Dario Cantatore/ Getty Images

Source: Business Insider, Forbes

In an in depth interview with Bloomberg, Li talks about everything from his childhood down to the present moment.

          

Source: Bloomberg.

Li enjoys spending his “mad money” on these investments rather than on material things. He consciously makes an effort to be perceived as materially modest. He wore a £30 electric wristwatch throughout the 1990s.

Tyrone Siu/ Reuters

Source: Business Insider

Perhaps one of the most important factors that have contributed to Li’s success is the passion he feels for his work. In 2010, he told Forbes, “The most important enjoyment for me is to work hard and make more profit."

Li poses with a young fan at one of his foundation's events.Love Ideas Love HK/ Facebook

Source:  Forbes

Li has no timetable in place for his retirement. The recent consolidation of his holdings into two companies appears to be a move in preparation for when he hands his empire over to his oldest son, Victor. However, at 89-years-old, Li shows no signs of slowing his success anytime soon.

Tyrone Siu/ Reuters

Source: Business Insider