The incredible life of private equity titan Robert Smith, the 268th wealthiest American

Robert F Smithrobertfsmith.orgRobert F. Smith, CEO of Vista Equity Partners

Robert F. Smith, CEO and founder of private equity firm Vista Equity Partners, just graced the cover of Forbes’ richest Americans issue

With a net worth of $US2.5 billion, he’s ranked #268 on the list of Forbes’ wealthiest Americans.

That puts Smith ahead of early Facebook investor Jim Breyer, who has a net worth of about $US2.4 billion, and on par with private equity veteran and Philadelphia 76ers co-owner Josh Harris, who has earned $US2.5 billion to date.

He also displaced Michael Jordan, becoming the second-richest African American in the United States — behind Oprah Winfrey. 

It’s the latest accomplishment in a stellar 12 months for the leader of one of Silicon Valley’s budding software and technology investors. Last October, Smith and Vista closed a fund nearing $US6 billion, the firm’s biggest ever. 

He also got hitched to Hope Dworaczyk, mother of his young son, in a wedding that can only be described as epic

Check out scenes from the life of one of private equity’s rising stars:

Smith spent years working as an intern at Bell
Cornell University campus

Smith attended Cornell for undergrad but he never lost touch with Bell Labs. He continued to do work there as an intern during his summer and winter breaks before graduating Cornell with a chemical engineering degree.

After Cornell, Smith headed to Columbia University
Columbia University

Smith would go on to earn his MBA from Columbia University. Afterwards, he headed straight to Wall Street, taking a job at Goldman Sachs. 'When I finished business school and decided to join the tumultuous world of investment banking, my family and friends spoke up with concerns about my sanity,' he said in his American University commencement speech.

Smith would rise to co-head of enterprise systems and storage investment banking, advising on $US50 billion of deals from 1994 to 2000.

Smith launched Vista Equity Partners after leaving Goldman Sachs

Stephen Lovekin/Getty Images
Robert F. Smith, founder of Vista Equity Partners

Smith left Goldman Sachs in 2000, where he worked on tech M&A, and launched his own private equity firm. In the 15 years since, Vista Equity Partners has generated outsized returns for investors and grown to nearly $US16 billion in assets, according to Forbes. It is considered to be one of private equity's up-and-coming firms.

His former colleagues at the bank thought he was crazy
Vista founder Robert F. Smith speaking at American University's 2015 commencement

'When I left my post at Goldman Sachs just after we had gone public to set up a private equity firm called Vista Equity Partners…my mentors and colleagues at Goldman thought I had lost it,' he said in his speech earlier this year.

'I was never mad at those folks, in fact I'm grateful for their advice and concern. In their caution, I found my courage. In their doubts, I found my resolve. In their warnings, I found my voice and chartered my own journey.'

Smith's investing strategy is to back Silicon Valley's least-known companies


Silicon Valley may be best-known for billion-dollar-valuations and soaring real estate prices, but Smith's strategy is practically contrarian: he's investing in software and technology companies that aren't in the least bit flashy. The New York Times recently called Vista's hiring strategy 'decidedly unusual' for how it uses tests to whittle down candidate lists.

Smith's private equity firm is generating monster returns

Graphics by Andy Kiersz
Bar chart captures Vista Equity funds' performance, regularly returning 30% to investors

In the years since Vista's founding, the firm has generated bumper returns for investors and gradually increased assets under management. Smith's fund collected nearly $US6 billion for its most recent fund, despite only setting out initially to collect less than $US4 billion.

Smith has the respect of many of his Wall Street peers.
Robert F. Smith, CEO of Vista Equity Partners

Smith's strategy -- as well as his work ethic -- have won him praise on Wall Street. He's the 'antithesis of (Blackstone CEO Steve) Schwarzman,' a tech industry banker told Business Insider. The banker went on to praise Vista, as well, saying 'there is no shortage of PE shops that have succumbed to style-creep and/or chasing fleeting trends, but Vista has remained focused on enterprise software and technology.'

Another banker told Business Insider that Smith was 'one of the smartest men I've ever met.'

Smith parties in style

Anna Webber/Getty Images
Smith, pictured here with his wife, who he married in a lavish ceremony this summer.

This summer, Smith married Hope Dworaczyk, a former Playboy playmate and mother of his young son. The two celebrated by renting out the Hotel Villa Cimbrone in Italy and putting on a star-studded display that included entertainment from Seal, John Legend and Bryan McKnight.

Here's another shot from Smith's and Dworaczyk's lavish wedding

And here's a look at the incredible Italian villa the couple rented out for their ceremony
Hotel Villa Cimbrone in Italy

The couple held their wedding at the Hotel Villa Cimbrone in Italy on the Amalfi Coast, shown here.

Smith is now the second richest African American behind Oprah

Kevin Winter/Getty Images
Oprah speaks onstage during the 45th NAACP Image Awards presented by TV One at Pasadena Civic Auditorium on February 22, 2014 in Pasadena, California.

With his arrival at the #268 spot on Forbes' list, Smith moves into elite company. He's the second richest African American, only trailing Oprah Winfrey, and displaced NBA Hall of Famer Michael Jordan in the magazine's rankings. When he took an investment from Dyal Partners, Neuberger Berman's private equity unit, in Vista, it valued his firm at $US4.3 billion. Smith still controls a majority stake in Vista.

Smith said that being African American in private equity has caused him difficulty: 'I know that's the reason certain limited partners don't back us,' he told the New York Times.

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