How a Bankrupt Company Bought for $1,000 Became an $85 Billion Giant
The success story of Jeffrey Sprecher, founder and CEO of Intercontinental Exchange (ICE), is a vivid illustration of how a small but well-timed investment can pay off on a massive scale. In 1997, he came up with the idea of creating a system for trading electricity on an exchange — even though he had never worked at a stock exchange before and had no trading experience whatsoever.
It was around this time that Sprecher learned Continental Power Exchange, owned by Warren Buffett's electricity company MidAmerican Energy, was on the brink of bankruptcy — despite Buffett's company having poured $35 million into it. Sprecher saw the situation as an opportunity and decided to buy the company. "I bought it for a dollar a share, and there were a thousand shares total," he recalls. "So I bought it for $1,000, and that's what I built Intercontinental Exchange on."
The company's early years were far from glamorous: Sprecher lived in a 46-square-meter one-room studio apartment and commuted to the office in a used car. Despite being CEO, he handled the most basic chores himself — taking out the trash, turning off the lights, answering the phone, and even buying copier paper. In 2000, Intercontinental Exchange was officially founded in Atlanta with just nine employees.
Today, nearly 26 years later, ICE has a market capitalization of $85 billion and employs more than 12,000 people. The company has owned the New York Stock Exchange (NYSE) for over a decade now. Sprecher's personal fortune currently stands at $1.2 billion.
Sprecher's story is not the only example of an entrepreneur making the right call at the right time. Ken Ricci, chairman of the private aviation company Flexjet, followed a similar path: after being laid off, he bought Corporate Wings in 1981 for just $27,500 and, by the early 1990s, had turned it into a business generating $3 million a year. Stories like these show that great empires often begin with the smallest and seemingly riskiest step.
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