After earning a company millions of dollars, Robert F. Smith wanted to be on the other side of the equation.
Before Smith became a billionaire, he worked as a chemical engineer for several years.
When he graduated from Cornell University and earned his bachelor’s degree in 1985, Smith was satisfied with his salary, which during AFROTECH Conference 2023, he revealed amounted to $36,000 at one point.
“I got my first job out of college and I made more money than my dad made at the peak of his career and I was like, ‘Wow. I mean, life is just wonderful,'” Smith said on the Innovation Stage during the “Powering Forward: Creating a Shared Digital Future” panel held at AFROTECH Conference 2023.
Operating in contentment could have trapped Smith from experiencing greater levels of economic freedom. Coming from a small town he acknowledged financial literacy wasn’t taught in school. Instead, he leaned into the power of curiosity to eventually enable him to become a billionaire by age 55.
However, it wouldn’t have been possible if he didn’t shift his mindset while working a salary job.
While reading about Black professionals on Wall Street in Black Enterprise, Smith realized that there was little disparity in terms of ability between him and the individuals earning millions of dollars annually.
“These guys are making a million dollars a year, and I was making $33,000 a year, and I thought you couldn’t make any more money than that,” he explained on the Innovation Stage. “And I’m looking at these guys and I’m like, they don’t look any smarter than me. They’re not chemical engineers. So, I know they’re not smarter than me, but they’re making that much money, ” Smith said while chuckling. “So, I started viewing my job a little differently.”
He recalled developing code for his former company, resulting in a significant boost in project productivity. As a result, the company made millions in profit, yet he received only a modest $3,000 salary increase.
“For instance, I was implementing at that time some programmable logic controller into a plan,” he detailed. “And I’m writing code for this. When I was done with that project, I increased the productivity of that plant by 26%. I was like, ‘Man, this is massive,’ but this was labor. Then I said, ‘Well, hang on a second, who’s actually really getting the benefit of that?’ Now I got a bump raise. I went from $33,000 to like $36,000…but that plant increase of production, 26% is a whole shift of production. Millions of dollars of economic rent was then captured by the company that I worked for.”
He added, “That woke up my attention to there’s another part of the equation. And many of you, engineers, technologists, etc, there’s a labor part of the equation that very few people can do, which is what you all can do. But there’s a capital part of the equation as well that because in a capitalist society, capitalism actually captures more that economic benefit if managed properly. And I’m like, ‘I’m on the wrong side of the equation.'”
From that point on, Smith decided to shift his focus to the world of business. He attended Columbia Business School at Columbia University and earned an MBA. He would jumpstart his new career path working at investment firm Goldman Sachs, according to The History Makers. During his tenure at the company, he oversaw $50 billion worth of merger and acquisition transactions from companies that include Apple, Microsoft, eBay, and Yahoo.
His work through his company has also helped propel him into billionaire status.
At the time of this writing, Smith is worth $9.2 billion, per Forbes.
