How Self-Made Titans Got Started

Capital is a constraint for many would-be entrepreneurs -- or is it?

Scan the Forbes list of the world's richest people and you'll come across moguls from startlingly humble origins. How did they get their impressive empires off the ground? Sweat, savings, schmoozing, creativity and a dab or two of good fortune.

To be fair, the lucky few "born on third base" probably have a better shot at stardom than those without a safety net. According to a 2002 U.S. Census Bureau survey representing some 16 million business owners, a whopping 55 percent were initially funded by personal and family capital. Just 11.4 percent snagged bank loans and 8.8 percent got going on personal and business credit cards; much of the remainder lived on government loans and outside investors.

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Some world-beating entrepreneurs -- like John Catsimatidis, owner of the Red Apple Group and aspiring mayor of New York City -- scared up capital by getting to know the right people.

The son of a busboy, Catsimatidis entered the grocery industry in the summer of 1966, just after graduating from high school. Befriending the owner of a Manhattan superette, he started taking on more responsibilities. Four years later, the owner offered him a 50 percent stake in one of his stores, to be acquired over 10 months at a rate of $1,000 per month.

Within a few months, the store's sales doubled, and Catsimatidis was earning a profit of $500 per week (not bad for a 20-year-old back then). After dropping out of New York University just eight credits shy of a degree, he launched his own grocery chain, the Red Apple Group. Lacking working capital for inventory, Catsimatidis charmed vendors to let him buy on credit, something he says "would never happen today." By the age of 25, he owned 10 stores--debt-free--netting a combined $1 million on $25 million in sales. Today the Red Apple empire includes Gristede's, Sloan's and Red Apple.

While Catsimatidis struck out on his own early, others, like Sandy Weill, saved their pennies before taking the plunge. Born in Brooklyn, N.Y., to Polish immigrants in 1933, Weill graduated from Cornell on scholarship before working as a runner for Bear Stearns and nabbing his stockbrokers' license at night.

A few years later, in 1960, he and three friends pooled their savings -- an estimated $200,000 -- and opened their own brokerage firm, called Carter Berlind and Weill. Two decades of acquisitions later, their Travelers Group was the industry's second-largest brokerage, trailing only Merrill Lynch. In 1998, Travelers Group merged with Citicorp to make what is now known as Citigroup.

Old fashioned bartering helped put Kirk Kerkorian, farmer's son and future Wall Street titan, on the map. In the late 1930s, Kerkorian offered to look after famous female aviator Pancho Barnes' cattle in return for flying lessons. During World War II, he took a job with the Royal Air Force transporting planes from their Canadian factory to England at $1,000 per month -- an especially treacherous journey as the planes weren't designed to withstand the long trip or the harsh weather over the North Atlantic.

With savings from his wartime job, Kerkorian purchased Trans International Airlines for $60,000 in 1947. (It is unclear as to whether he needed additional financing.) He later sold it to Transamerica for $104 million in stock, used to fuel further investments. His private investment firm, Tracinda, now owns 53 percent of MGM Mirage.

Sometimes sheer talent and persistence is enough. As a single mother on welfare in Scotland, J.K. Rowling began writing the first Harry Potter novel in Edinburgh cafés whenever she could get her infant daughter to sleep. After being rejected by 12 publishing houses, Bloomsbury, a small publisher in London, offered an advance of 1,500 pounds (about $2,400) -- even while one its editors, Barry Cunningham, advised Rowling to get a day job.

Good thing she didn't listen: The following year, U.S. publishing rights to the first Potter book sold for $105,000. Rowling has since moved nearly 400 million copies worldwide, and is the only author on our list.