Super Rich, but Not Rich Enough

Ah, the late 1990s.

Remember stopping into Starbucks, logging onto America Online over a latte and scooping up $5,000 or so with a couple of day trades? And then, when looking for a place to spend the newfound loot, checking out Martha Stewart's Web site for her latest home decorating tips?

If those days seem like a long time ago, they were. For proof, witness the smal — but growing — list of prestigious bubble-era entrepreneurs who cracked the Forbes 400 list of wealthiest Americans at the height of their success, only to drop off during the past few years.

Starbucks founder and Chief Executive Howard Schultz, along with former Black Entertainment Television chief Robert Johnson, both fell off this year. They join Stewart and AOL co-founder Steve Case, both of whom dropped out in 2006, as ex-Forbes 400 qualifiers.

Both Starbucks and BET were founded in the 1980s but realized their biggest growth in the '90s. Starbucks and AOL went public at the dawn of the Internet age in 1992, while Martha Stewart Living Omnimedia followed suit seven years later.

The trend isn't purely a sign of declining fortunes on the part of some of the 1990s jet set. It's just as much a matter of tougher admissions standards in an era of rising wealth and a growing number of billionaires. Last year, for the first time, the Forbes 400 consisted entirely of billionaires.

Others dropping off the list were elderly longtime members who died in 2007, including Wal-Mart matriarch Helen Walton (widow of founder Sam Walton), hotel magnate Leona Helmsley, California winery legend Ernst Gallo and media heiress Barbara Cox Anthony.

But for those among the living, the changeover in parts of the Forbes 400 brings a feel of Internet-era excess coming to an official close. List dropouts Stewart, Case, Johnson and Schultz are still very wealthy, of course, but their relative poverty reflects the post-bubble era of more historically normal stock valuations.

Case is best known for engineering the biggest mega-deal of the era, parlaying highflying AOL shares into a merger with Time Warner in 2001. But the deal was a bust, leading to a huge drop in the stock price from which the company still hasn't recovered. Time Warner shares are worth less than a fifth of what they were in 2000. AOL is now a separate unit within the company, and Case is no longer on the board, though his personal stake in Time Warner is still worth nearly $300 million.

Martha Stewart Living Omnimedia, which traded above $33 a share when its founder returned with much fanfare from a five-month prison term in March 2005, now sits below $12 a share. A company that essentially created the modern home help industry in the '90s now faces a host of tougher, more focused competition from the likes of Chris Madden and Meredith Corp.

MSO lost money in both 2005 and 2006, while Stewart recently put her famous Turkey Hill residence in Westport, Conn., on the market for $8.9 million. And joining her this year on the ex-Forbes 400 list is none other than her current boyfriend, former Microsoft software designer Charles Simonyi.

Intensifying competition has also hit Starbucks, which has seen a slowdown in same-store sales and a 32% drop in its share price over the past year. That's what happens when the McDonald's and Dunkin' Donuts of the world see what they're missing and upgrade their coffee brews. Starbucks and Schultz are still making plenty of money, but to reignite growth they're rushing to open overseas stores and push out new products like chocolate-coffee hybrid drinks.

BET's Johnson, who sold his network to Viacom in 1999, a year after taking it private, took a financial hit after an expensive divorce a few years ago. He's probably pretty happy counting the $1 billion or so he still has, while enjoying the view from the owner's box at the arena of his NBA franchise, the Charlotte Bobcats.

He may even enjoy a Starbucks coffee during a game, while his ex-wife browses Martha Stewart's Web site with her divorce winnings. But not as many Americans are doing the same.