Barry - Rich Kids

Young, hip and smart, like the Rich Kids who backed it, One.Tel grew faster than any company in Australian history - then vanished in a puff of smoke.

At the height of the hype, in November 1999, One.Tel was worth more than $5 billion, almost as much as Kerry Packers entire empire. Its founder, Jodee Rich, was worth close to $2 billion, with two houses, a jet, a helicopter, three powerboats and a private resort in the WhitSundays. Less than 18 months later the fun and friendly phone company was gone, the Packers and Murdochs had lost nearly $1 billion, and Jodee Rich was being investigated by Australias corporate cops.

Rich Kids is the inside story of One.Tels meteoric rise and fall, told by awardwinning investigative journalist Paul Barry. Its a tale of chaos, incompetence, greed and deceit; of an era when huge fortunes were made in the crazy dot-com boom; and of James Packers and Lachlan Murdochs business brilliance - or lack of it.

Above all, Rich Kids is the story of One.Man. Jodee Rich dragged millions of dollars from the wreckage of his first corporate disaster in the 1980s, then seduced Australias two most powerful families to back him in One.Tel and did it all over again.

Getting closer to the publicity-shy Rich than anyone else has ever been able, Paul Barry delivers an explosive and entertaining account of one of Australias biggest corporate disasters.

I first meet Jodee Rich two months after the collapse of One.Tel. We are alone in his lawyers office on the 23rd floor of Sydneys Glasshouse, and he wants to talk. Hes dressed casually in cream pleated slacks, boat shoes, and a blue moleskin shirt, and hes smaller than expected. He has thin grey hair and pale, almost papery, skin, which make him look older than his 41 years.

Its no surprise that he looks a bit roughhes been through a lot in the previous few weeks. The company he founded has been snatched from him and shut down. Hes been branded a liar and a criminal by the press, and attacked by politicians from both major parties. He has incurred the wrath of the most frightening man in Australia, Kerry Packer, who has threatened to remove his right testicle. And he has offended the nations most powerful media baron, Rupert Murdoch, who owns two-thirds of Australias newspapers. He is also being investigated by a large contingent of Australias corporate cops.

Worst of all, his dream is in ruins and people are saying hes failed again. Eighteen months ago the media were calling him a genius. He was hip, cool, clever, and a billionaire to boot. Now theres an almost $2 billion black hole. For the second time in a decade, his shooting star has come crashing down to earth.

Despite all this, he is bright, charming and relaxed. He doesnt seem angry or bitter. Hes not even self-obsessed, or not obviously. He exudes an air of calm righteousness, like a Christian whos about to be thrown to the lions. But rather than God, perhaps his faith is in Jodee. His detractors say that he thinks he is God and thats his problem.

In the months to come I will ask him what mistakes he made and whether he would do things differently next time round, but the best he will offer is that he grieves for a wonderful company, which should never have been allowed to fail. If Jodee made a mistake, he sayslapsing suddenly into the third personit was that he didnt fight to the end. It was that he left One.Tel when the Packers and Murdochs insisted he go. It was their refusal to put in another $132 million at the end of May 2001 that killed the company.

Across Australia, when this minor mea culpa is aired on the TV news, you can almost hear the guffaws. Many who worked for One.Tel cant believe hes saying this, and certainly dont think its true. They know the state the company was in.

But self belief is the key to being an entrepreneur, and Jodee Rich has it in spades. It was what persuaded the Packers and Murdochs to put almost $1 billion into One.Tel and stay around till they lost it. It was what drove the company to acquire 2 million customers and made it a household name in Europe. It was what propelled the company on its meteoric rise.

On this, my first of many meetings with Jodee, he looks me in the eye, grins a Cheshire cat grin, and reaches out to touch my wrist. It is as if he assumes we are already firm friends, that I am already on his side. It is not how journalists or authors are usually treated, but Rich is an unusual man. He has that capacity to focus on the person he is with, to make them feel special, to cast a spell. He is clearly used to getting his way.

There is no doubt that he used this power to seduce James Packer. Those who watched them say they were like brothers or best friends. They talked of life and love and powerful fathers. They went on trips together. They were forever on the phone. They shared the dream. Their intimacy and trust was vital to the rise of One.Tel. And now they no longer speak.

Jodee Rich also seduced a willing public. Here was a company that ate cash from the day it was floated on the Australian Stock Exchange, and gobbled up almost $2 billion of other peoples money in its short life. Yet the markets valued it at more than $5 billionalmost as much as the entire Packer empireonly 18 months before the crash.

Rich Kids is the story of an era when huge fortunes were made and lost in the mad dot-com and telco boom. It is also a story of James Packers and Lachlan Murdochs business brilliance, or lack of it. But above all, its the story of One.Tel and One.Man, Jodee Rich, without whom none of this could ever have happened.

Jodee Rich is not your average guy and the Riches are not your average family. Theyre rich, eccentric, and decidedly different.

Back in the 1980s for example, at the wedding of his younger sister Nici, the bride, groom and guests all danced in the nude. It was held in the garden of the Riches home in Sydneys Eastern Suburbs, with the well-known comedian Vince Sorrenti acting as marriage celebrant and taking charge of the ceremony. The guests gathered around as Sorrenti, in the guise of the Reverend Doctor Love, with a red ribbon around his penis, stood at one end of the swimming pool while the pregnant bride and her attendants swam under a wooden bridge towards him, roses clenched between their teeth. There was much laughter, fun and cheering, the formalities were completed, and the marriage was made.

Then the music started, and everyone began to conga naked round the garden. Jodees mother led the procession, like a big bare-breasted fairy, wearing nothing more than a happy smile and a white see-through skirt. The bridesmaids were similarly attired, with flowers in their hair, like sprites from A Midsummer Nights Dream . The other guests wore nothing at all.

The conga complete, they all jumped into the pool and drank champagne. In the wedding pictures some 20 men and women, including Jodee and his wife Maxine, jostle for space in the Jacuzzi, like an aquatic version of that famous cover for Jimi Hendrixs Electric Ladyland album. Later, they all put their clothes back on and ate pork spareribs in the garden. The Riches are Jewish, but clearly not orthodox in any sense of the word.