What Was Pablo Escobar's Actual Net Worth?

We all know Pablo Escobar was one of the most successful criminals in history, but the extent of his influence and power still remains unknown. In 1989 Forbes declared him as the 7th richest person in the world with a "book value" net worth of $9 billion dollars. However, in 1986 he offered to pay off Columbia's $10 billlion dollar national debt in a political gamble, which leads me to believe his net worth was actually much higher. Let's not forget Forbes makes their estimates based off public records, and a man as intelligent as Pablo Escobar makes sure the majority of their net worth doesn't really exist on paper. So let's hear estimates from finance experts. Has a cocaine smuggler surpassed John D. Rockefeller as the wealthiest person in history on an inflation adjusted basis, or was his actual net worth well below $100 billion dollars?

Comments (32)

Jan 16, 2011

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Jan 16, 2011

How could someone possibly pay off a national debt in one day? If a bunch of people buy treasury bonds, they expect to receive a stream of cash payments over several years and then their nominal investment at the end of that period. If they just get their money back, they'd be like "wtf?"

Jan 16, 2011
randombetch:

How could someone possibly pay off a national debt in one day? If a bunch of people buy treasury bonds, they expect to receive a stream of cash payments over several years and then their nominal investment at the end of that period. If they just get their money back, they'd be like "wtf?"

Unless the guy paying you back is a ruthless leader of a drug cartel...then you just smile and say, "Nice doing business with you, sir". Probably not the person you want to negotiate with, lol.

Regards

Jan 16, 2011
randombetch:

How could someone possibly pay off a national debt in one day? If a bunch of people buy treasury bonds, they expect to receive a stream of cash payments over several years and then their nominal investment at the end of that period. If they just get their money back, they'd be like "wtf?"

Each bond has a market price, just buy back all the bonds and voila.

Btw lol at the 100m - 100B market, that is one illiquid SOB

Jan 16, 2011

I seriously believe he was under 100m, the drug business is not a centralized one, like say italian mob, but the opposite, very independent operation cells that trade with each other. What Pablo, and most of the other guys you hear of, have is the control over the routes, which is the very profitable part of the chain. Thats why it would have been hard for him to go over 100m, as money was spread along the cells.

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

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Jan 16, 2011
El_Mono:

I seriously believe he was under 100m, the drug business is not a centralized one, like say italian mob, but the opposite, very independent operation cells that trade with each other. What Pablo, and most of the other guys you hear of, have is the control over the routes, which is the very profitable part of the chain. Thats why it would have been hard for him to go over 100m, as money was spread along the cells.

You could not be more wrong...

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Jan 16, 2011
El_Mono:

I seriously believe he was under 100m, the drug business is not a centralized one, like say italian mob, but the opposite, very independent operation cells that trade with each other. What Pablo, and most of the other guys you hear of, have is the control over the routes, which is the very profitable part of the chain. Thats why it would have been hard for him to go over 100m, as money was spread along the cells.

clearly you have never seen american gangster...granted it was heroine, but Frank Lucas wasn't nearly as large as Pablo was....and his net worth was estimated at 200mm

The answer to your question is 1) network 2) get involved 3) beef up your resume 4) repeat -happypantsmcgee

WSO is not your personal search function.

Jul 17, 2013

You are completely wrong.

Jan 16, 2011

it's fucking cocaine we're talking about here - and pablo escobar was the biggest. definitely above 9 billion.

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Jan 16, 2011

About what?

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

Jan 16, 2011
El_Mono:

About what?

When Pable ran things it was basically him and a few other players controlling all of Columbia's production, they generated some pretty impressive profits when they didn't have to worry about every coffee farmer who couldn't get by planting a few coca trees, selling the leaves to a local pharmacist trying to get a couple more bucks and selling it to a regional drug lord. Instead with Pablo it was a vertically integrated operation whereby anyone producing without his approval or the protection of one of the other major players would be dealt with rather violently.

Jan 16, 2011
rafiki:
El_Mono:

About what?

When Pable ran things it was basically him and a few other players controlling all of Columbia's production, they generated some pretty impressive profits when they didn't have to worry about every coffee farmer who couldn't get by planting a few coca trees, selling the leaves to a local pharmacist trying to get a couple more bucks and selling it to a regional drug lord. Instead with Pablo it was a vertically integrated operation whereby anyone producing without his approval or the protection of one of the other major players would be dealt with rather violently.

This is not true. First Pablo's Medellin Cartel was one of two in Colombia at that time, the other being the Cali Cartel which being less known had just the same success, and even helped in the downfall of Pablo.

http://en.wikipedia.org/wiki/Cali_Cartel
You can see that the industry had a very organic structure, the guys supplying the cali cartel could also supply the medellin cartel or could get integrated into the operation, however it was less convenient and that is why the little cells specialized. Farmers who plant coca are specialized in planting coca, there are chemists that only work on the cooking and people with independent labs that supply just the cocaine to whoever buys it, think of something like producing chips, one plants potatoes, other transports, other makes chips out of them and other distribute them. People with the routes, the part where the margin was (and still is) can own plantation, transformation and distribution, but its not efficient and they tend not to do it, instead buying the product. Now, they could of course push for exclusivity on their suppliers, but also other partners and even people without full time involvement could pool in. There were syndicated shipments where people just pooled their own drug to be delivered in a route and payed a fee. That also explains why, once Pablo or other cartel heads were killed or captured, the underlying business operated just as usual and that is why now there is so much violence in mexico and not Colombia, they have the routes.

Pablo is so well known because he was so ruthless, however that power-concentration eagerness was a huge factor in his downfall, as people he started to go after got together and started to act against him and they had the means to do it. His position was weaker than is commonly portrayed, and the industry is not so vertically integrated, in fact it is far from the point of everything in the business belonging to just one guy. There is a great book on that:

http://www.amazon.com/Padrinos-mercaderes-organiza...
Sorry but I havent found and english version, basically it compares the italian mafia with the colombian.

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

Jan 16, 2011

"By some estimates, Pablo Escobar enjoyed an ROI of as much as 20,000%. In other words, for every $1 invested in the business, he received approximately $200 in return." - Wiki

"In 1987 Forbes magazine estimated Escobar to be the seventh-richest man in the world with a personal wealth of close to $25 billion...while his Medellin cartel controlled 80% of the global cocaine market" - I'm going to take Forbes' method of determining net worth over yours...

Not real sure why you think they were splitting the coke trade with anyone but 100mm is a ridiculously low number...

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Jan 16, 2011
happypantsmcgee:

"In 1987 Forbes magazine estimated Escobar to be the seventh-richest man in the world with a personal wealth of close to $25 billion...while his Medellin cartel controlled 80% of the global cocaine market"

Do you have the link for that website? The $25 billion dollar estimate is common, but most of the websites I checked have the Forbes estimate listed at $9 billion dollars.

Men are so simple and so much inclined to obey immediate needs that a deceiver will never lack victims for his deceptions.

-Niccolo Machiavelli

Jan 16, 2011

Just search Pablo Escobar on wiki and look through the citations

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Jan 16, 2011

The 2nd citation says $25 billion, but it brings you to this site:
http://www.worldfinancialblog.com/entertainment/th...
I believe the estimate by Forbes was actually $9 billion dollars. Does anyone have a 1987 copy of Forbes hidden in their attic?

Men are so simple and so much inclined to obey immediate needs that a deceiver will never lack victims for his deceptions.

-Niccolo Machiavelli

Jan 16, 2011

Ok, now there will not be an agreement here but to me:

  1. in 1987 he had been trafficking for a while, by 1991 he was on the run. He had big expenses on the way, assuming he had amassed 25 billions by 1987 I seem plausible he could have gotten up to a maximum of 75b, but not more in the 4 following years.
  2. By 1987 the crackdown on the cartels was already on its way (http://en.wikipedia.org/wiki/Carlos_Lehder) and making money become more risky, limiting how much they could do.

3, The 20.000% ROI is an "as much"

btw, I am talking about going over 100 bn, not 100m, 100m is very low and all of you are right to that regard, my mistake.

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

Jan 16, 2011

Wait, you meant to say that he was actually worth 100 BILLION dollars? That's 2 facebooks bro....

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Jan 16, 2011
happypantsmcgee:

Wait, you meant to say that he was actually worth 100 BILLION dollars? That's 2 facebooks bro....

Actually, that's 2 Facebooks as of last week, it's probably just half a Facebook now, lol.

Needless to say, the guy had a shit ton of money. I would bet that Forbes was a rather low estimate, but I could be wrong. If Forbes had some way to (somewhat) accurately project his net worth (given whatever information they could get a hold of) I would still bet that it was on the low side. This guy probably just had houses just jacked full of money all over the place...essentially money that wouldn't be accounted for in a bank, on paper, etc.

Better than a Ponzi scheme.

Regards

Jan 16, 2011
happypantsmcgee:

Wait, you meant to say that he was actually worth 100 BILLION dollars? That's 2 facebooks bro....

Consider, though, that their products are wildly similar.

"Despite a voluminous and often fervent literature on 'income distribution', the cold fact is that most income is not distributed: it is earned."
-Thomas Sowell

Jan 16, 2011
moranges:
happypantsmcgee:

Wait, you meant to say that he was actually worth 100 BILLION dollars? That's 2 facebooks bro....

Consider, though, that their products are wildly similar.

Except you cant store facebooks

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

Jan 16, 2011

That was the original question asked, I argue he was under 100bn, I wrote 100m by mistake, my whole argument before is about him being under 100bn. Now, over 100m I dont think anyone has any doubts.

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

Jan 16, 2011

You won't get any arguments about him being under 100B either dude, that's quite the wide window

If I had asked people what they wanted, they would have said faster horses - Henry Ford

Jan 16, 2011

having 25bn by 1987, he had to do 75bn net of expenses in 6 years in such a business and with the other cartel, the guerrillas, many of his former partners and the Colombian and US goverment on his ass. It might be, I just dont find it plausible.

Valor is of no service, chance rules all, and the bravest often fall by the hands of cowards. - Tacitus

Dr. Nick Riviera: Hey, don't worry. You don't have to make up stories here. Save that for court!

Jan 16, 2011

I stand corrected. That 100m typo threw me off and made me write something off a half-remembered History Channel special. SB for that post.

Jan 16, 2011

I think 50-100b is an accurate range. I mean he was selling coke at a time when coke's "coolness" peaked. Anyways whatever the number is anyone that is interested in the subject should check out this pretty cool flick "Cocaine Cowboys" covering the coke/drug trade in Miami durring its heydays.

http://www.youtube.com/watch?v=0sJiBoqH1Yg (trailer)

It is available via instant stream on Netflix and it is on Youtube broken down into 13 parts not sure how much of it is missing but enjoy haha

Jan 16, 2011
michaelj901:

I think 50-100b is an accurate range. I mean he was selling coke at a time when coke's "coolness" peaked. Anyways whatever the number is anyone that is interested in the subject should check out this pretty cool flick "Cocaine Cowboys" covering the coke/drug trade in Miami durring its heydays.

http://www.youtube.com/watch?v=0sJiBoqH1Yg (trailer)

It is available via instant stream on Netflix and it is on Youtube broken down into 13 parts not sure how much of it is missing but enjoy haha

Excellent documentary, that made Scarface look like a Disney movie. Just don't watch the sequel, you will be disappointed.

Men are so simple and so much inclined to obey immediate needs that a deceiver will never lack victims for his deceptions.

-Niccolo Machiavelli

Jan 16, 2011

I would say 25b at least. I also think Forbes methods are a bit difficult when it all private information. For instance of the ruling families in the middle east have oil pipelines, that is basically theirs. Also I think the Shah of Iran had a shitload of gold bars just hidden somewhere. Not sure forbes could calculate that?

I wonder if Pablo worked with any legit bankers at the time lol..

Jan 16, 2011

Escobar was worth well over $9 bn. He controlled something like 75% of the cocaine industry when he was at the height of his power. Curious as to how much that is in today's terms?

On the street, an 8 ball (1/8 ounce) generally sells for about $90-150, we'll say $100 because it's easy. So the would be $800 for an ounce, $10,800 for a pound.

At one point it was estimated that 70-80 TONS per month were being shipped to the US alone. So let's be conservative here and say in 1985 he shipped 600 tons of cocaine to the US. That's 1.2 million pounds.

1.2 million pounds x $10,800/lb = $12,960,000,000

Yep, that's almost $13 bn in gross revenue in 1985. Only 1985. Also, he had an ROI as high as %20,000. Let's be conservative and say that, generally, his ROI was %1,000. That means that to make $13 bn, he only spent $1.3 bn. Let's be honest, though, there's no way he spent $1.3 bn a year on his operation.

Worth more than the $9 billion that's often quoted? Absolutely. Worth more than the $25 billion that's often quoted? HIGHLY likely. Worth $100 billion? Not likely, but there's a chance.

Also, when he offered to pay off Columbia's debt, he did that to secure the Columbian Presidency, which had been a dream of his since a child. I have no doubt he could've scrounged up the $10bn to pay it off.

Jan 17, 2011
Denver Monkeyannabe:

Escobar was worth well over $9 bn. He controlled something like 75% of the cocaine industry when he was at the height of his power. Curious as to how much that is in today's terms?

On the street, an 8 ball (1/8 ounce) generally sells for about $90-150, we'll say $100 because it's easy. So the would be $800 for an ounce, $10,800 for a pound.

At one point it was estimated that 70-80 TONS per month were being shipped to the US alone. So let's be conservative here and say in 1985 he shipped 600 tons of cocaine to the US. That's 1.2 million pounds.

1.2 million pounds x $10,800/lb = $12,960,000,000

Yep, that's almost $13 bn in gross revenue in 1985. Only 1985. Also, he had an ROI as high as %20,000. Let's be conservative and say that, generally, his ROI was %1,000. That means that to make $13 bn, he only spent $1.3 bn. Let's be honest, though, there's no way he spent $1.3 bn a year on his operation.

Worth more than the $9 billion that's often quoted? Absolutely. Worth more than the $25 billion that's often quoted? HIGHLY likely. Worth $100 billion? Not likely, but there's a chance.

Also, when he offered to pay off Columbia's debt, he did that to secure the Columbian Presidency, which had been a dream of his since a child. I have no doubt he could've scrounged up the $10bn to pay it off.

He controlled the routes and distribution. He wasnt making street price off of his product. Your analysis seems to assume that he made 100 dollars for every 8 ball, which was not the case. Even at an ounce, the street price is closer to 550, not 800. Also, a lot of money went into sustaining this operation. paying all the employees, hiring hitmen, paying off officers, etc. I can't say how much he was worth, but I think your revenue estimate is a little off the mark and even if its not, a small portion of that probably went into his pocket.

Jan 17, 2011
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Jul 16, 2013