On his way to becoming the richest man in the world, the Brazilian businessman got his start in gold at age 23
Eike Batista—known as a swashbuckling businessman and no stranger to the gossip columns—is already said to be the wealthiest person in Brazil. Because of his oil holdings and interests in a vast number of other businesses, he may well become the richest man in the world. Batista, one of seven children of a high-level government official, got into gold at an early age and eventually controlled mines from Chile to Russia. In addition, he has been involved in energy, water, and steel companies. Now Batista is betting that Brazil will be a major oil power.
Fifteen years from now, what do you want to have achieved?
We believe that in five years Brazil will be the fifth-largest economy in the world. And we're just one of the many companies helping Brazil grow. Obviously, the oil discoveries will [bring about enormous changes]. We're talking about 100 billion barrels of recoverable oil.
Your father is a very distinguished Brazilian.
What I learned from my father is to think big. There's a movie called Brazil's Engineer, and it's about him because he built part of [the country's] infrastructure—railways, super ports to ship iron ore to Asia. But I was educated by my mother because my father was very busy. She was German, from Hamburg, and she taught me discipline and caring for others.
You were educated in Germany?
Basically, up to my 12th year, I was educated in Brazil. Then I lived in Europe, following my father, who was internationalizing CVRD [Companhia Vale do Rio Doce, now Vale, one of the largest mining companies in the world].
At age 23 you went back to Brazil and started out with a gold mine on the Amazon.
Initially, I started a trading company to buy the gold and sell it. After a year and a half, there I was at 23 with $6 million in my hand. And margins were going down because competition started to come in. I said, "I have to reinvent myself. Why not buy one of these rich pick-and-shovel mines and mechanize it?" By 1983, I had Brazil's first alluvial mechanized gold mine running in the Amazon jungle. I underestimated the weather, technical conditions, diseases, logistics—but ultimately the mine was so rich, it was idiot-proof because it survived all my mistakes.
So the moral is, if you're going to take a risk, make sure the payoff at the end is enough to justify the problems. Was the principle the same when you bid for the oil exploration sites off the coast of Brazil and took great risks?
The same principle. But you know, over time you learn that knowledge is important. So I hired a team of executives from [the Brazilian state oil company] Petrobras who had great knowledge. Finding oil is a multidisciplinary science. You need a lot of people—statisticians, engineers, and geologists, of course. And what I have learned in the past 30 years is that I read people better than I read books. So they showed me I could have a 60% success ratio: If I spend $1 billion dollars, at least $600 million would potentially find wealth. What I did was put up $1.3 billion to participate in the auction and...as of today, we have had 100% success. Every well we drilled since last August was a hit. Brazil will be producing 5 million or 6 million barrels of oil a day.
There was a period in your life when you were a speedboat racer. What was that about?
I wanted an international title, and realized I couldn't outrun Ben Johnson in the 100 meters, so I said let me put some engines behind me. I won the Brazilian championship, then the world championship and the American championship. I got all the titles I wanted and got out. I didn't want to die, and my oldest son was born. You change your risk profile.
Do a bit of psychology for me. You had a famous father, you were married to a well-known womana former Playboy cover model. Was there a bit of you that said, "I have to find a way to make my mark, and I am going to become Brazil's richest man"?
Yes, it's part of the psychology, no doubt. I was educated to think maybe Brazil works, maybe it doesn't. But I decided I am going to make this country work for my children. I am investing all my effort now in making Brazil a great country.
What could your net worth be in the next 10 years?
$100 billion. But what is important is that Brazil is the highway for that. Did you know China has already surpassed the U.S. as our largest trading partner? China has endless demand for oil, food, and iron ore. Most things the Chinese need we have in abundance and can export. In 800 A.D., the Chinese had half of the world's GDP. In the next 20 or 30 years, I think they're back to 50% of the world's GDP.
In this new world economic order, what is the future of the U.S.?
From the outside, I see political gridlock. You have to start thinking out of the box. I believe in democracy, but let me tell you something that few people realize: In Brazil, our president can implement emergency measures for six months. That's exactly what he did when the world got into trouble in 2008, and that's why Brazil came out [of the financial crisis] so much faster than everybody else.
When you look at America, what concerns you, what encourages you?
You are now heavily indebted like Brazil was before. You have to be a little bit more Spartan. In the last 20 years you have focused too much on banking and finance. The best students went to banks or law firms. Where are the engineers? Americans should be driving electric cars, and you're not.