How I made my first million : 26 self-made millionaires reveal the secrets to their success

S
tepheN
 c
orby
GolDen ruleS
1. Choose something you can be passionate about.
2. build systems. Simplify every process and make 
sure it can be duplicated.
3. Fix things once. Multiply every problem by 100 
before starting on the solution.
4. Look at where you are getting results and focus 
resources there.
5. be honest and open with your staff. Communi-
cation is critical.

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A Fascination 
With Figures
Angus Geddes
Fat Prophets; 
established 2000;
thirty- five employees;
$5 million- plus turnover
There’s something strange, 
almost freakish, about 
highly successful city busi-
nessmen. Very often you find that before they 
applied their nuclear- powered brains to finance 
they studied quantum physics, built their own 
computers or wrote papers about how to solve 
Rubik’s cubes, things that are incomprehensible 
to most p eople.
Photo: Angelo Soulas

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A FASCINATION WITH FIgURES 83
By the time he turned twelve, Angus Ged-
des had memorised the names of every director 
of every company on the New Zealand stock 
exchange. Rain Man would have been proud. ‘I 
was just fascinated by investing,’ he recalls. ‘I’d read 
every company report to soak up all the infor-
mation I could. I read annual reports from cover 
to cover.’ That same year, Geddes decided that 
the savings he’d put in the bank weren’t return-
ing enough interest. So he became an investor. 
‘In the early 1980s, interest rates in New Zealand 
were pegged at about 2 per cent, and I’d saved 
up a couple of hun-
dred dollars. I told 
my dad, There has to 
be a way of getting a 
better return on my 
money. So we went 
to the stockbrokers to open an account.’ By the 
age of sixteen, Geddes had turned his 
$
200 into 
$
40,000.
‘I made some extraordinary calls,’ he says. ‘And 
I had some luck. But I also had a good broker 
who gave me some good steers that chimed with 
my own judgment.’ That was the era of Wall 
Street the movie, yuppies and the ‘greed is good’ 
mentality. But for Geddes, it was never about the 
money. He claims never to have aspired to big 
‘ ‘
I’d read every company 
report to soak up all the 
information I could. I read 
annual reports from cover 
to cover.

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84 HOW I MADE MY FIRST MILLION
houses or flash cars. He drives an eighteen- year- 
old Mercedes 560SL which, he says proudly, has 
appreciated in value.
For Geddes, everything is about value. He 
won’t fly first class because he doesn’t think it’s 
worth it, but does fly business because it deliv-
ers comfort at a reasonable price. His investment 
approach is the same. He looks for out- of- favour 
companies that have been underperforming the 
market for an extended period and are, in his 
view, underpriced. Then he invests, waiting for a 
turnaround in sentiment to take the share price 
back up. The approach has served him well for 
two decades, although it took him six years to 
recover from the 1987 market crash.
In the early 1990s, Geddes travelled to Lon-
don and New York and worked in stockbroking, 
gaining valuable experience that he put to good 
use when he arrived in Sydney in the mid- 1990s. 
‘I took a job at a small brokers on full commis-
sion—no salary at all—and I hit the Yellow Pages, 
cold- calling professionals like doctors, lawyers 
and accountants. I asked if they’d be receptive 
to good investment opportunities, and I would 
often leave them with a tip. They’d see the com-
pany do well, and that would get them interested. 
Many of those clients are still with me.’
At the time, Geddes says, he was a bit of a 

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A FASCINATION WITH FIgURES 85
maverick: ‘No one was doing that kind of cold- 
calling in Sydney—but I’d seen the guys on 
Wall Street doing the same thing. It’s hard, but 
it worked. Within six months, I was writing 
$
300,000 to 
$
400,000 of business a year, taking 
home the best part of 
$
200,000.’
Soon afterwards Geddes was headhunted by BT 
Financial, where he stayed for a couple of years 
before moving on to broker JBWere. His value- 
investing approach meant standing firmly against 
the trend. ‘Back in 2000, when the technology 
bubble was inflating, every body was piling into 
it. But I just knew it was going to crash. You see, 
I’d seen it all before, in 1987, when I lost a huge 
chunk of my own money that I’d spent half my 
life accumulating. That really hurt. And I could 
see all the warning signs again: hugely overvalued 
companies based on virtually no earnings, massive 
speculation, the madness of crowds. It had gone 
crazy.’
While many of his peers were cheerleading 
for high- tech, ‘I was advocating gold and energy 
stocks, both of which had been completely out 
of favour and were coming out of long bear 
markets. I think a lot of p eople thought I was a 
bit mad. It turned out to be a great call, because 
gold and value stocks such as energy companies 
did exceptionally well.’

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86 HOW I MADE MY FIRST MILLION
Geddes tried to get his clients out of tech 
and into these value stocks, but was largely 
ignored. ‘I showed them graphs of the ’87 crash 
and the past and present Nasdaq index, and said 
the same thing was going to happen, but most 
of them were so sold on the tech story they’d 
just go and buy tech stocks through another 
broker,’ he says.
That was a turning point for Geddes, who 
found the experience so exasperating that he 
decided to quit. ‘I just thought that I’d be better 
off backing my own 
ideas: starting my 
own newsletter and 
website where I can 
write my thoughts 
down and clients 
can read it or throw 
it away, but I’m not 
going to go hoarse on the phone every day giv-
ing p eople advice they’re just going to ignore. 
It’s tough as a stockbroker, because you’re inter-
acting with p eople’s greed and fear, which are 
very intense emotions. It can be exhausting, like 
banging your head against a brick wall, especially 
if you’re a contrarian investor like me.’
Geddes set up his own independent research 
house and named it Fat Prophets. Thanks to some 
‘
‘
It’s tough as a 
stockbroker, because 
you’re interacting with 
p eople’s greed and fear, 
which are very intense 
emotions.

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A FASCINATION WITH FIgURES 87
astute stock- picking, his small base of initial sub-
scribers quickly expanded—to the surprise of 
some early nay- sayers: ‘P eople thought it was 
crazy to call ourselves Fat Prophets, because it’s 
a bit “out there” and not very conservative; they 
said investors wouldn’t trust us. And they were 
probably right in the very early days, but we 
soon made some good calls and our reputation 
started growing.’
Although he had been earning good money for 
some time, Geddes says it wasn’t until 2002–03, 
when the business had gained some momentum, 
that he made his first million—a combination 
of his personal share portfolio and the value of 
the business. But his response was just business 
as usual: ‘I certainly didn’t stop and think that I’d 
made it, or that it was any kind of milestone.’
The business was so successful that Fat Proph-
ets opened an office in London and now has 
a funds- management arm as well as a listed 
investment company with 
$
50 million under 
management. Geddes has also launched a popular 
range of so- called separately managed accounts: 
preselected portfolios of shares for investors. And 
soon he wants to launch a hedge fund.
His mantra, ‘There is no such thing as failure 
in business,’ has made him fearless, giving him 
the drive to make Fat Prophets a truly global 

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88 HOW I MADE MY FIRST MILLION
brand and the belief that he can. So what is 
Geddes investing in now? Not property, that’s 
for sure. ‘I sold my apartment in 2003 and have 
used the money to much better effect by invest-
ing in equities,’ he says. ‘You’re better off renting 
and investing your money in shares than buying 
a property right now. Why buy an underper-
forming asset that might yield 2 per cent when 
you could get into shares that will give returns 
of five or ten times that much? I think resi-
dential property prices are at risk: interest rates 
are going to rise, and in eighteen months or so 
I think you could see prices falling and some 
good buying opportunities springing up. But I 
won’t be buying anything till I see some value 
in the market.’
When Geddes says his investing philosophy is 
not about the money, that isn’t entirely true. It is 
about the money, but as an abstract score rather 
than hard cash. The dollars he earns are just points 
in a big game called Success in the City. All Ged-
des wants is to be right, see his theories borne out 
and prove his critics wrong. So far, so good.