Tuesday, March 27, 2018


Uganda possibly has the highest per capita of fake tycoons in the region. The y turn up out of the blue, with no visible source of income, drive flashy cars, are resident in posh area codes and send money as if it is going out of fashion.

In recent weeks we have got an inkling of how this money is made, get rich schemes such as sorcery, extortion and fiddling the books have played on the headlines of our newspapers. There are also the perennial suspects – long serving public servants and bank workers.

But those are only the ones who have been caught. How many get away with it? Who knows.

Then there is the rest of us who have convinced ourselves that we are tycoons too. A bank loan or unexpected windfall (not entirely legal) falls in our laps and we run out to fulfil our fantasies. Living large is not a sign of wealth, its just living large.

So here is my fast and ready guide on how to tell whether you, or the playboy, next door is not a tycoon, in no particular order of importance.

1.       Most of your income comes from a job
I don’t care who you are or how much you earn. If more than half your income comes from your job, you are not rich, just highly paid or have no investment income to your name. A job is not transferable to your spouse or kids. And if you fall sick, after your employer has done the decent thing and paid you for a while, will dispense with his obligation to you.

No enduring wealth is built on earned income. To be truly wealth you have to develop passive income, which comes from money working for you. And this takes time years, decades even generations.  Real tycoons do not pop out of the woodwork one day with a cooked up story about inheriting money from a dead geriatric they used to take care of in the UK.

2.       You think money is for eating
There are only two ways to spend money, either you consume it or you invest it. The more of the latter that you do than the former, the more likely you are to accumulate a handsome pile of wealth in your life time.

Judge your expenditures against that black and white criteria. If you consume more than you invest you are a fake tycoon.

One real tycoon said “Money is not for eating but for making more money”.

3.       You own an expensive car
What is an expensive car? This is how to tell you are driving an expensive car. Take the value of all that yu owe, your liabilities and subtract that from the value of all that you own, your assets to get your net worth as a person. If the value of your car is more than a tenth of your net worth you are a fake tycoon.

In the seminal book the “Millionaire Next Door” author Thomas J. Stanley reported that the average millionaire in the US drives a car that is worth seven percent of his net worth.

So when you see a real tycoon buying his car from the shore room know it is but a small fraction of his total wealth or income.

4.       You need to show it
You cannot understand why if you have money people should not know? So you have vanity plates on your car, splash (literally) your money at night clubs and are keen to let your social media followers know when you are sipping on a nojito in town or wearing Jimmy Choos.

You are loud in word, deed and dress.

Your ostentatious consumption betrays deep seated insecurities from your poverty stricken background. When you were a kid and did not know better, you promised yourself that when you made your first million you would sponsor an open bar at Guvnor. Somehow you didn’t outgrow the juvenile fantasy.

A real tycoon knows that to maintain his wealth, he has to keep what he has close and always be on the lookout for more opportunities to grow what wealth he has. He is driven by insecurities too, but his are his fear of ever going back to his humble beginnings.

5.       Your wealth needs you to stay one step ahead of the law
Often times this kind of wealth cannot be replicated without taking unimaginable risk. And the thing with risk is that the more often you risk, the more likely your number is going to come up.

They say, A thief has 40 days. Replace thief with kidnapper, corrupt official, taxi drive … take your pick.

The real tycoon has a system of creating wealth in which he puts in labour, capital and land through one end and money comes out the other. It is often a time tested system that can even be passed on to his offspring. If you don’t have such a system you are a fake tycoon.

Fake tycoons are bad for the economy. They do not champion hard work, thrift and integrity. They provide a wrong example for future fake tycoons. They distort markets, paying above value for cars, land, houses and businesses dooming genuine business to failure.

If you are not a fake tycoon you need not read on.

If you are fake a tycoon, have seen the error of your ways and want to turn a leaf, read everything above and then do the exact opposite.

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