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Toto Wolff built Mercedes’ F1 team into an auto racing dynasty. Their championship days may be behind them, but the billionaire racing boss is more successful than ever.
As Toto Wolff surveys a large room at the Mercedes-AMG Petronas headquarters in Brackley, England, his eyes are drawn to the rear axle of a silver car. The right wheel is broken, and it bothers him, prompting him to call for repairs immediately. But the billionaire co-owner and team principal of Mercedes’ F1 team is not inside his factory, and this isn’t a full-scale $8 million Formula 1 car he’s assessing. Rather, Wolff is dissatisfied with a decorative model of a classic Mercedes, only a few inches long. “It just jumps into my eyes,” he explains. “In my normal life, it’s actually an annoyance for my environment because I just can’t stop trying to eliminate imperfection.”
That obsessive pursuit of perfection may be a burden for most people, but in Formula 1 racing, where success can be defined by less than a tenth of a second, it has consistently kept Wolff’s team on the podium. Over the past decade, the 51-year-old Austrian has collected eight Constructors’ Championships, seven Drivers’ titles and an astonishing 115 Grand Prix victories – thanks to his flawless machines and Mercedes’ marquee driver, Lewis Hamilton. It’s an unprecedented run in the sport, befitting other legendary franchises like the New York Yankees and the Boston Celtics.
Except Mercedes isn’t winning anymore. The team scratched its way to third place last year, taking the checkered flag at just one
Grand Prix. Returning to the top looks unlikely in 2023, as Red Bull Racing currently possesses a stranglehold on first place. A financial overhaul of F1 rules in 2021 that limits spending – the cost cap – has stifled Wolff’s perfectionist approach, allowing fewer chances to rebound from mistakes.
While the cost cap has presented its greatest challenge on the grid, it’s had a strikingly positive effect away from the track. In 2021, the last year Mercedes won the Constructors’ title, the team posted its best results ever under Wolff, with revenue of $529 million and Ebitda of $128 million. Although the organization has yet to release its 2022 figures, Forbes estimates it will exceed those marks by roughly 10% and 30%, respectively.
Such turbocharged revenue has translated directly into team value. Forbes valued the Mercedes team in 2019 at $1 billion and estimates it has at least doubled since. Wolff owns 33% of the team – most of which he purchased in 2013 for an estimated $50 million –, constituting the cornerstone of his $1 billion fortune. In essence, he has built a brand akin to the Dallas Cowboys, which remains the world’s most valuable sports franchise at $8 billion despite a 27-year Super Bowl drought.
“I would give up every single penny of the profits to win,” Wolff says. “So choosing between financial success or sporting success, every day of the week, every day of the year, I’ll go for the sporting success.”
“As long as we are competing at the front, racing for victories, being among the top teams,” he says.
“Nobody can expect us to win every single year.”
That monomaniacal desire to win is hardwired into Wolff. Born in Vienna, he dreamed of becoming a race car driver since childhood. He came up short chasing his passion – in part because he is too tall at six foot five – and soon shifted to business. He founded Vienna-based tech incubator Marchfifteen in 1998, spending his days cold calling potential investors. Two years later, at 28, Wolff notched a profit of more than $30 million, almost entirely from the sales of text-messaging outfit UCP and video game publisher Jowood. Flush with cash, he wound down his company and returned to his first love, auto racing, and started managing junior drivers. That led him to engine maker HWA AG, which supplied Mercedes’ lower-level racing teams. He bought 49% of HWA in 2006 and later helped take it public in a $175 million IPO, netting himself an additional $85 million.
Wolff invested in the Williams F1 racing team a few years later and helped deliver a stunning Spanish Grand Prix victory in 2012. That same year Mercedes was struggling and invited Wolff to Stuttgart to tap his expertise. He bluntly told them they were vastly under-budgeting the team, and Mercedes replied by offering him the top job. “He’s not a bullshitter,” says René Berger, Wolff’s longtime friend and a Mercedes F1 board member. “Toto will never tell you something he believes is not really true, and that’s why he’s so persuasive.” Wolff agreed, but only under the stipulation that he could buy in as a co-owner. In 2013, he departed Williams and took a 30% ownership stake in Mercedes at a $165 million valuation, Forbes estimates.
The timing of the move also worked well for Mercedes, given rule changes that expanded hybrid engine use in F1 – which the German automaker had already spent more than $100 million developing. The titles followed quickly, with Mercedes collecting both the Constructors’ and Drivers’ Championships in 2014, the first in its dynastic eight-year run. “It was the perfect move from Mercedes at this stage,” says Scuderia Ferrari team principal Frédéric Vasseur, “and they took a real lead on the engine.”
That type of strategic spending is now more difficult. Under the cost cap in 2023, teams can spend only roughly $150 million to cover equipment, engineering and staffing. Driver salaries, such as Hamilton’s estimated $55 million, are excluded for now.
In years past, big-budget teams like Mercedes, Ferrari and Red Bull would spend hundreds of millions annually, justifying the cost as global marketing. Lower-end teams would slip into financial ruin trying to keep pace with the F1 elite. Much to the credit of the Liberty Media Corporation, which in 2017 bought Formula 1 for $4.7 billion in cash and stock, and the FIA, racing’s governing body, the cost cap has created greater parity among teams.
F1 is also getting a huge boost – especially in America, where the sport has lagged in popularity – from Netflix. Debuting in 2019, the “Drive to Survive” docuseries, which chronicles each F1 season, tapped into a younger, digital-first audience. It also created new F1 stars, including the charismatic Wolff with his militaristic metaphors, fiery competitiveness and oddly specific breakfast order. (“Ham and eggs. With a little bacon and two pumpernickels, really toasted so they break.”)
And F1 will only get bigger this year when it adds a third U.S. Grand Prix in Las Vegas in November. (Miami and Austin, Texas, already host events.) “The sport’s growing,” Wolff says, “but you must not take it for granted.”
He’s not taking Mercedes’ good fortune lightly, either, securing a lucrative future even without being world champion. Sponsorships remain the most important revenue stream; Mercedes counts Ritz-Carlton, Monster Energy and watch brand IWC among its partners. It also sells equipment to other teams, including gearboxes to Aston Martin. That doesn’t mean Wolff has any plans to slow his push for wins.
Text: Justin Birnbaum, Forbes US
Fotos: Levon Biss, Forbes US
Infografiken: Emin Hamdi, Valentin Berger