You may like Ikea more or less, but I don’t think there’s much doubt about the success the company has had throughout its history. One figure played a key role in his rise. Its founder, Ingvar Kamprad, was a man different from his time. The businessman died with billions of dollars in his account, but the key that led him to success and which he followed meticulously throughout his life was very simple. One tip: Never spend more than necessary.

Ingvar Kamprad before Ikea. When you imagine the man who founded the Ikea empire, you might think of someone who lived a dream life that few could achieve. But the company has become what it is today, in part because Kamprad is the exact opposite of these stereotypes. Despite his wealth, he was known for his frugal habits.

He was born in Sweden in 1926 and his start as a “businessman” began very early. At the age of five he sold matches, and at the age of ten he devoted himself to selling bicycles, fish and even Christmas decorations to his neighbors. When he was 17, he created Ikea with the money his father gave him in exchange for good grades. Of course, I wasn’t selling furniture at that time, I was just selling small kitchen items for the home.

Kamprad in 1965

Ikea is getting old. This happened in 1956, when Kamprad revolutionized the market and the furniture industry by introducing furnished flat boxes that could be assembled at home. Yes, this started a path of selling the product that continues to this day, reducing the company’s costs in exchange for the consumer doing the other part of the business: assembling the furniture.

The founder achieved such success that he became one of the richest men on the planet. In fact, when he died in 2018, he was ranked eighth on the world list and had an estimated net worth of $58 billion. But if you had met him in life, you would not have thought that you were dealing with a billionaire.

Kamprad’s life hack. Explaining the secret of the success of a company like Ikea in an article is nothing but faith. Of course, it can be understood better and more easily with the book, but we can understand some of the keys through the figure of its founder. And Kamprad insisted on one thing: to save money, and he carried this motto every day of his life. “We need everything we earn as backup,” he said.

For example, the man was known for flying economy class, staying in affordable hotels, or driving a ’93 Volvo 240 GL that would last him 20 years. He gave it up when he was convinced it was actually dangerous. Kamprad said he learned to be cautious with money in the small town in southern Sweden where he grew up: “It’s Smaland’s nature to be frugal.” An example of this occurred in 2014, when he returned to Sweden after 40 years of tax exile with clothes he “only bought at flea markets”.

Haircut anecdote. In 2008, The Guardian described a scene that said a lot about the personality of the businessman. Apparently, after paying around 22 euros for a haircut in the Netherlands, he said the price was too high for his normal haircut budget: “I usually try to get a haircut when I’m in a developing country. “The last time was in Vietnam,” he said.

The company’s philosophy of life. These habits not only represented the beginning of Kamprad’s personal philosophy towards consumerism, but they would also serve as a model for his employees. The New York Times detailed that flights, meals, and stays in low-cost hotels were initiatives he encouraged among executives.

In fact, in 1976, Ikea distributed “The will of a furniture salesman,” a booklet containing guidelines that its employees have followed ever since. In it, he details parts of his frugal philosophy, stating that “wasting resources is a mortal sin at Ikea.”

His legacy, his legacy. Decades before his death, Kamprad transferred ownership of the Ikea brand to a complex network of foundations and holding companies. However, these assets were not transferred to their heirs. The Stichting Ingka Foundation, a Dutch organization whose aim is to donate to charity and “support innovation” in design, apparently controls most Ikea stores.

Additionally, the Interogo Foundation owns the rights to the brand and controls global franchises through a subsidiary. This foundation is governed by a board in which Kamprad family members have minority control. That is, the heirs retained some of the wealth and control, but the majority of their wealth was held in charitable foundations. A complex structure as a result of Ikea’s desire to preserve its unique culture and keep it alive in the long term.

Why Ikea? Before we finish this little collection of stories of the man who founded the most famous furniture company, here is a secret that most people do not know. Why is it called Ikea? This is an abbreviation of the initials of Kamprad’s first and last name, as well as the initials of the family farm where he was born (Elmtaryd) and the name of the nearest town (Agunnaryd).

Image | Ikea, Haparanda Midnight Ministerial Meeting, Public domain

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