Ingvar Kamprad is the mastermind behind the grand IKEA empire. He is now 85 years old, but he was only 17 when he founded the company which eventually became the largest furniture retailer in the world. And he wasn’t even born in a rich family! This is our favorite kind of story: the one that talks about prodigy children from poor families, who eventually become the world’s richest people. Kamprad’s story is exactly like that.
Ingvar Feodor Kamprad was born on March 30, 1926 in south Sweden and he grew up in a farm near a small village called Agunnayrd. His grandfather had moved from Germany to Sweden many years before, making Invar a second generation Swede of German descent. Growing up on a farm was not easy for young Ingvar, and some sources even say that he had much trouble waking up early to milk the cows with his father. His parents were worried about the boy’s attitude and his father believed that he would never make anything of himself. Then one day he got an alarm clock for his birthday.Apparently this very practical gift changed his young life. He decided to turn over a new leaf and started by setting the alarm at 5:30 and removing the off button from the clock. At only 10 years old, he started to develop a small business, selling matches to his neighbors. He learned that he could buy them in bulk, then sell them individually at low prices and still gain a pretty good profit. While other children his age were struggling with mathematics in school, Ingvar was already thinking in business terms. As things were going well for him, he decided to expand his business and start also selling seeds, fish, Christmas decorations, pens and pencils.
Not only did Invar do good with his business, but he also did great in school, determining his father to give him a cash reward for his efforts when he was only seventeen. He took the money and used it to establish his own company, which he called IKEA. Most teenagers would have spent the cash in an entirely different way, but Ingvar was more mature than that. The name of the company is an acronym that stands for his name (Ingvar Kamprad), the name of the farm in which he grew up, Elmtayrd (now spelled Älmtaryd), and the name of the nearby village, Agunnayrd.At first, IKEA sold pens, pencils, picture frames, wallets, table runners, jewelry, watches, nylon stockings – things that people usually needed back then. In 1945, about two years after he founded his company, Ingvar decided it was time to advertize in newspapers. This decision brought him a lot of new clients whom he satisfied with fast deliveries via the county milk van.
It wasn’t long before Kamprad decided to expand the IKEA product range by introducing furniture to its offer. This idea received a very positive response from the clients and the company’s sales continued to grow at an encouraging rate. Unfortunately, the competition also grew, meaning that Kamprad had to find a new way to stay on top. In 1953 the first IKEA furniture showroom was opened, giving customers the opportunity to see and touch the products before ordering them. With this move, the competition problem was pretty much solved…for the moment.
Not long after this, pressure from the competitors determined the suppliers to boycott IKEA. Kamprad however managed to turn the problem into an opportunity: in 1955 IKEA started to design its own furniture. This eventually led to improved functions and innovative designs, again raising the company above its competitors. One day, an employee came with this brilliant idea of taking off the legs of a table to avoid transportation damage and also to make the table fit into a car. Thus a new trend was born: IKEA started designing for flat packaging. As a result, the prices were lowered for the customers, who now felt more enthusiastic about each purchase, because they had the opportunity to enjoy assembling the furniture themselves.
Unsurprisingly, IKEA’s sales continued to grow, slowly turning the company into an empire. The first IKEA store outside Scandinavia was opened in 1973, near Zurich, Switzerland. Shortly afterwards, the first IKEA store was opened in Germany, which eventually became the largest IKEA market in the world. In 1975, Canada and the Netherlands opened their arms for the successful furniture manufacturer. In 1985 IKEA made it to the other side of the pond, bringing quality and low prices in the States as well. The next few years saw an impressive expansion of the company in many different countries, including The UK, Italy, the Czech Republic, Poland, the United Arab Emirates and even China. By 1999, Kamprad’s empire had expanded to 29 countries on four continents.Obviously, this kind of success translates into a lot of money for Ingvar Kamprad. Interestingly enough though, the incredibly successful business man is not a lavish spender at all. On the contrary, he is famous for being very frugal: he drives a 15-year-old Volvo 240, sometimes uses public transportation, only flies in economy class and tells his employees to write on both sides of a paper. He is also known to sometimes go to IKEA to buy furniture or to have a “cheap meal”. This doesn’t mean that he never enjoys a luxury life. He has a nice villa in Switzerland, a vineyard in France and a large country property in Sweden. He also used to drive a Porsche.
When he was young, Ingvar Kamprad used to be part of a pro-fascist political movement in Sweden (The New Swedish Movement), which emphasized Swedish nationalism, anti-Semitism, anti-communism and a cult of personality around its founder, Per Engdahl. Kamprad later talked about this and called his involvement with the fascist movement the greatest mistake of his life. He also used to have alcohol problems, but he is now fully recovered and still an incredibly successful man. His charity foundation, Stichting INGKA Foundation, was reported by The Economist to be the wealthiest charity (larger than Bill Gates’), with an estimated value of approximately $36 billion in 2006.
Regarding his wealth, it is not exactly clear just how big it is. According to Veckans Affärer (a Swedish business journal), Kamprad is one of the wealthiest people (if not the wealthiest) in the world, with an estimated net worth of $50 billion to $90 billion. The journal based its report on the assumption that he owns the entire company. Both his family and IKEA however deny this. Forbes has a different approach on the matter and ranks Kamprad number 162 on their list of wealthiest people in the world, with an estimated wealth of $6 billion.