Broadcom Founders O.C’s Wealthiest in Forbes 400 List
Real estate barons, move over. The titans of technology are taking over.
After years of staking claim to being the wealthiest person in Orange County, developer Donald L. Bren of the Irvine Co. was knocked off that perch by the two founders of Broadcom Corp.
Henry T. Nicholas III and Henry Samueli are worth about $10 billion each, making the Broadcom duo the richest in Southern California and No. 18 in America, according to Forbes magazine’s list of the nation’s 400 richest people.
The two Henrys, as they are known, ranked 90th last year. They leapfrogged past Bren, whose estimated net worth of $4 billion ranked him at No. 61, up from 68th last year.
The wealth of the Broadcom executives is based on the spectacular stock gains from their highflying communications chip company.
Indeed, the powerful surges of tech companies and the growing wealth of their executives symbolize a broader, dramatic shift in Orange County, where wealth has long been synonymous with real estate. The new pecking order is just one indication of the transformation from the “old economy” to the new.
Two of the county’s other high-tech executives broke into the Forbes’ 400 for the first time: Vincent C. Smith and David M. Doyle, chairman and president, respectively, of Quest Software Inc. in Newport Beach. Microsoft Corp.’s Bill Gates once again reigned as the nation’s wealthiest, but his fortune slipped to $63 billion from about $85 billion a year ago. And a drop in tech stocks, which seemed to be signaled by Thursday’s after-hours trading plunge in Intel Corp., Broadcom and others, could put a dent in the Henrys’ fortunes as well.
Nonetheless, Orange County observers said the new rankings are emblematic of a region and a nation in flux.
“This is a reflection of the growing strength of Orange County’s high-tech sector, as well as a symbol of the transformation the county has undergone in the last two decades,” said Anil Puri, dean of the College of Business and Economics at Cal State Fullerton.
“There’s no question that the county’s economy is not driven by real estate and construction now as much as it is driven by manufacturing and services,” Puri said.
Yet Chapman University President James Doti--who noted that he also happens to occupy the Donald Bren endowed chair in economics--said wealth from technology firms is often derived from stock prices that are based on estimates of future profit, not current earnings.
As a result, the net worth of many tech entrepreneurs has increased “geometrically,” Doti said.
“That’s in contrast to a Don Bren, [whose] wealth is not so much based on the market capitalization of a company but on the value that people ascribe to land,” he said.
Doti said he has no doubt that Bren will hold his own in the “new economy.”
“I personally would give much greater long-run faith and value to real estate than I would to many of these new companies,” Doti said, noting the recent downturns in many “dot-com” enterprises.
Samueli, Nicholas and Bren did not comment on the rankings.
But in a 1992 opinion piece in the Los Angeles Times, Bren himself predicted in the midst of a nationwide recession that the handful of small technology companies in Orange County would be instrumental in the region’s recovery.
“When the recession ends,” Bren wrote, “our small companies are poised to aggressively (and I believe successfully) compete in a vastly different and changing world economy.”
Other county residents on the list are Quest’s Smith at 129th with $2 billion in net worth; and Doyle, also of Quest, who tied at 372nd with oil heiress Anne Catherine Getty Earhart with $775 million in net worth.
The six from Orange County who made the rankings were among 107 residents of California, making it once again the most popular place for the wealthy. New York state was second with 47, Texas was third with 34 and Florida and Massachusetts followed with 16 each.
The roster of the top 400 was laden with the technology executives. At a close second to Microsoft’s Gates was Oracle Corp.’s chief executive, Lawrence J. Ellison, with $58 billion.
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Times staff writer Robin Fields contributed to this report.
