As a lover of second-hand clothes and flea markets, IKEA founder Ingvar Kamprad also happened to be the eighth richest person on Bloomberg Billionaires Index. Hailed as one of the most influential business men and entrepreneurs of the twentieth century, Kamprad’s wealth was estimated at around $73.8 billion. Sadly, the mogul passed away late last month aged 91, leaving behind his staggering fortune. Regrettably for his families and heirs, they will inherit a mere fraction of Kamprad’s enormous wealth.
Starting at the age of five, Kamprad sold matches to his neighbours and gradually progressed to selling seeds, stockings and stationary from his bicycle as a teenager. By the time he was 17 he had founded IKA; the first mail-order catalogue launched in 1951 and in 1955 the famous flat-pack furniture was launched. By 1985 it had stores in Europe, Norway and the US, eventually establishing 412 stores across 49 countries.
Kamprad grew up on a farm in southern Sweden and attributed his financial outlook to the attitude of the agricultural region in which he grew up. This functionality displayed in his business model permeated to the style of furniture he sold. Rooted in his homeland, he even conducted meetings in the downstairs of the flat in which he was living and grew up.
Although renowned for his internationally successful flatpack empire, Kamprad was equally known to be frugal in his financial dealings and perspective throughout his life. Bloomberg reported that his purpose is charity donations and ‘supporting [design] innovation’. Most of Kamprad’s furniture stores are owned by the Stichting Ingka Foundation and controlled Liechtenstein-based Interogo Foundation. The latter foundation is itself managed by Stiftungsrat Foundation Council, consisting of a Supervisory Council in which, as Bloomberg reports, the Kamprad family ‘ha[s] been and shall always be in minority’. The Kamprad family has no control over ownership of the company’s shares, with Kamprad arranging all the logistics personally so that they have no control of the IKEA company and will therefore receive minimal sums. They will receive a small amount from Ikano Group, owned by the family and who runs a number of businesses in a variety of industries. IKEA Foundation’s Chief Executive, Per Heggenes, confirmed Kamprad’s philanthropic outlook, stating in 2012 that he was ‘not interested in money’. The complex structure put in place by Kamprad not only means that profits can be reinvested into the company but also ensures IKEA’s longevity, as not even a direct heir can take control after his death.
Applicants for Economics, PPE or Land Economy might want to consider the complex nature of the internal structure Kamprad set up to protect his company’s reputation and longevity. Although he himself had not been involving in running IKEA since the late 1980s, with his son taking his place on the board of Inter IKEA in 2013, Kamprad had set in place the foundations to remain in control of his company and maintain the ethical values he practiced throughout his life and were inspired by the place in which he group up.