Meet Europe's richest man. Source: Zara
Europe is a continent steeped in both traditions and history. So you'd think Europe's richest person would be a long-standing member of the aristocracy. Or perhaps the richest would be a beneficiary of the kleptocratic nature of Western Russia's oil dealings. And if not these, at least the richest person is from the stable western economic powerhouses Great Britain, Germany, or France.
And you'd be wrong. Matter of fact, Europe's richest man defies all these stereotypes. A high-school dropout born to a railway worker and a housemaid -- not exactly the aristocracy --, Europe's richest man is actually a first-generation billionaire through his Zara clothing line. And if you don't know his name by now, it's Amancio Ortega, a Spaniard.
By owning 60% of Zara-parent company Inditex, his net worth is nearly $60 billion and makes him the fourth-richest man on the planet, between Berkshire Hathaway's Warren Buffett and Oracle's Larry Ellison. Here are some lessons we can learn from Ortega.
Fix what's wrong and use it as a disruptor
Zara did not reinvent a product category; clothing has been around since the first proverbial fig leaf. Rather, Ortega sought to simply outperform established peers. And once he found their Achilles' heel -- long and inefficient supply chains -- he built his company to benefit from other retailer's flaws. Matter of fact, Ortega is rumored to have two rules: give the customer what they want, and get to them faster than anyone else.
Essentially by doing this the company used its supply chain as to add value where other companies view it as an unfortunate side effect of doing business. The company's bifurcated strategy of manufacturing higher-fashion items in company-owned stores and outsourcing less trendy items in Asia instead of outsourcing all items to Asia set it apart from rivals.
And if something isn't selling well, Zara strategy allows it to modify or cancel the product quickly. This led to Louis Vuitton designer Daniel Piette describing Zara as "possibly the most innovative and devastating retailer in the world."
Talk is cheap; build your brand
Perhaps the most fascinating part of Zara's business model is its relative lack of advertisements. While most fashion companies plan glitzy, expensive ad campaigns, Zara relies on brand cachet and lower prices to move product. Matter of fact, it is widely known that Ortega believes advertising is a pointless distraction. This unconventional method may not work for all, but all aspiring entrepreneurs could benefit from doubling down on product quality.
And this silence extends beyond mere advertising, Ortega is notoriously secretive and generally refuses all interview requests as he grows his empire. Contrast that to many U.S. billionaires that incessantly offer their opinions of politics, fiscal and monetary policy, or [insert nonsensical issue here]. Ortega appears to understand his penchant is to make quality clothing at a reasonable price ... and his best way to enrich his fellow countrymen is to continue to focus on that.
The key lesson
Perhaps the best lesson that can be learned from Amancio Ortega is to do what you love and stay humble. Even now the semiretired chairman prefers to discuss fabrics, fits, and trends to reading company memos -- and not from a stuffy corner office; he never had one.
Fortune chronicles Ortega's extreme humility: Once while going to a store opening in Manhattan and witnessing shoppers pile in to buy his creations, Ortega became so full of humility and joy he shut himself in a bathroom to weep. For a high-school dropout to become the richest man in Europe required a combination of skill, tenacity, and luck; staying humble and doing what you love worked for Ortega, and it can't hurt aspiring entrepreneurs.
