Ghetto Boy: How Larry Ellison Became the Richest Man on Earth

On Wednesday, September 10, Oracle founder and chairman Larry "Larry" Ellison became the richest man in the world according to Bloomberg, overtaking Elon Musk, who held the title for almost a year. This happened after the publication of Oracle's quarterly report, which AP called"stunning". The company's stock skyrocketed, and Ellison's fortune increased by more than $100 billion in a single day - the largest daily increase in the history of Bloomberg's rankings. As of September 12, Musk is back at the top of the list of the richest people on the planet, but Ellison's fortune remains huge - $363 billion. How did he achieve this?

The beginning of Larry Ellison's life can hardly be called successful. He was born in 1944 to a young mother out of wedlock, and she soon gave the boy to relatives to raise. He never met his biological father, Business Insider reports. He was raised by the Ellison family and grew up in the south side of Chicago, which Look magazine once called "the oldest and worst black ghetto in the United States."

It was not the ghetto we imagine it to be today, with armed gangs roaming the streets. It was actually a Jewish neighborhood, surrounded by neighborhoods of blacks, Puerto Ricans and Latinos, Ellison recalled in 1995. Just a neighborhood that was populated by non-wealthy, "lower middle class" people, as he defined it himself. But, by Ellison's own admission, he didn't realize he was living in a "bad neighborhood" until he left there.

His adoptive father (an immigrant from Russia, according to Forbes) lost his real estate business during the Great Depression and made a living with "a modest job as an auditor for the public housing authority," the Academy of Achievement website says.

What Larry was fortunate in, however, was that his youth coincided with the rapid post-war growth of the US economy.

On the other hand, many people had it at that time, but not everyone in the post-war generation of American baby boomers became multibillionaires, to put it mildly. And the second luck was his decision in 1966 at the age of 22 to go to California, where Silicon Valley was emerging. Ellison went to university twice, but never graduated.

"A college degree is certainly helpful, and I would encourage everyone to get at least one. But, you know, I left school without a degree and came to California. I had never taken a computer science class in my life. I got a job as a computer programmer. I was pretty much self-taught. I just picked up a book and started programming," he told the Smithsonian Institution.

After a few years of casual labor, he was hired by the legendary Gene Amdahl, the creator of the architecture of the famous IBM-360 series of servers. In 1970 Amdahl together with Japanese Fujitsu founded his own company Amdahl, which was engaged in the development of competing with IBM servers. He even sent the young programmer on a business trip to Japan, and the Japanese culture made a lasting impression on Ellison, in particular, the focus on teamwork and the combination of incredible politeness in everyday life and equally incredible ferocity in business.

"In Japan, we believe that our competitors are stealing rice from our children. In Japan, we believe that a market share of less than 100% is not enough. In Japan, we believe that my success is not enough. Everyone else must fail. We must destroy our competitors," one Japanese businessman told him.

Subsequently, he benefited greatly from this advice.

In 1976, System R, an IBM research project, published a series of articles on a new way of storing and retrieving information - relational databases and the SQL database management language. The approach promised to greatly simplify the search for relevant information in huge amounts of data, but its commercial potential had yet to be realized.

"At the time, it was believed that relational databases would never be commercially viable because they were too slow. Because of this conventional wisdom, no one tried to build a commercial version... No company, including IBM," Ellison recalled.

In 1977, Ellison was working for Ampex, which had been commissioned by the CIA to build a database called Oracle ("Oracle"). He and two colleagues, Bob Miner and Ed Oates, decided that relational databases were a commercial opportunity that no one could see, which gave them an advantage. They chipped in, raised $2k, and started their own firm, Software Development Laboratories. The contract with the CIA they eventually "stole" from Ampex, and it brought them the first $50,000, writes Forbes, and then began a stubborn struggle for survival.

"All development was done with your own money. Back in the day, when you were trying to get money for a software company, despite Silicon Valley and its famous venture capitalists, they wouldn't even meet with you. They would just leave you waiting in the reception area for 45 minutes until you finally realized you weren't going to be accepted. And then the receptionist would search your briefcase to make sure you weren't stealing copies of Business Week off the coffee table. We were persona non grata in the venture capitalist community," Ellison recalled.

In 1980, Ellison's company had only eight employees and less than $1 million in revenue, but the following year IBM itself switched to Oracle for its servers, and Oracle sales doubled every year for the next seven years, writes the Academy of Achievement. In 1982, the company was renamed in honor of its flagship product, the Oracle database management system.

The company went public on March 12, 1986, its shares were offered at $15 and rose to $20 by the end of the trading day. If you had invested $1,000 in Oracle securities at that time, your shares would be worth more than $7 million on September 10, 2025 (taking into account several splits that have occurred since then), Benzinga calculates.

However, the main force that catapulted Larry Ellison to the top of the billionaire hierarchy was not database management systems, but his relatively new business - cloud computing.

As I wrote late last year, renting computer capacity over the Internet (that's cloud computing) has become a huge, fast-growing, and highly competitive $400 billion market in the first half of 2025, according to recent data from Statista. Amazon was the first to invent this model in 2006, and it remains the leader with about 30% of the market. It is followed by Microsoft (20%), Google Cloud (13%) and China's Alibaba Cloud (4%). Oracle rounds out the top five with a share an order of magnitude smaller than that of Jeff Bezos' company.

Apparently, in no small part because Ellison has been quite skeptical of the model for quite some time. "The computer industry is the only industry that is more fashion-oriented than women's fashion. Maybe I'm an idiot, but I have no idea what this is even about. What is it? It's total bullshit. It's insane. When is this idiocy going to stop?" he reacted sharply when asked about Oracle's cloud computing plans at a 2008 meeting with analysts.

However, as competitors' cloud businesses boomed, Oracle realized that they could not do without this technology either, and in the 2010s began actively recruiting specialists from Amazon. One of these employees, Don Johnson, suggested using the bare metal approach, when a client leases physical servers in their entirety, without having to share their capacity with other clients, which provided additional speed and security. The bare metal approach was personally endorsed by Ellison, who by then had already stepped down as CEO, but retained his position as chairman and CTO, continuing to keep a watchful eye on everything that happens at Oracle, Bloomberg writes.

As a result, Oracle's cloud business began to gain momentum. Major customers such as video calling service Zoom and cab company Uber emerged. But the real turning point was a contract with the Chinese network TikTok, which in 2022 announced that for the safety and peace of mind of American users, all their data would be processed exclusively on cloud servers of the American company Oracle. Annual revenue from that one customer quickly surpassed $1 billion - more than all the others brought in combined, Bloomberg reported.

And then in 2023 came the AI revolution, which is known for its incredible appetite for computer power. Ellison didn't hesitate here either - in January this year, at a press conference attended by newly elected President Donald Trump, he, along with OpenAI CEO Sam Altman and Softbank Chairman Masaesi Son, announced the Stargate mega-project, which involves investing $500 billion in building giant data centers, and it is Oracle that is to build and operate them.

Ellison's meteoric rise in wealth is precisely a consequence of this forward-thinking decision. In announcing its results for the first quarter of fiscal 2026, the company said its outstanding contractual obligations (RPO, which is actually a forecast of revenue already confirmed by contracts) rose 359% year-over-year to an incredible $455 billion. "In the first quarter, we signed four multi-billion dollar contracts with three different customers. Over the next few months, we expect to add several new multi-billion dollar customers and RPO will likely exceed half a trillion dollars," said Oracle CEO Safra Catz.

Of course, against this background, no one paid attention to the insignificant fact that software sales, which had been feeding Oracle for so many years, fell by 1%. They now account for 38% of total revenue, while cloud computing accounts for 48%.

A new era has arrived - Oracle is rapidly transforming from a software company into a cloud company. Given Ellison's penchant for the rigid Japanese style of doing business, competitors probably have something to fear. No one will steal his children's rice.

This article was AI-translated and verified by a human editor