In 1962, someone donated shares in a company to the elderly in his town. The company was Nokia and today they live like millionaires
There are stories that seem taken from a Hollywood script. That of Onni Nurmi, a young Finnish entrepreneur, has a name, surname, date and even a street named after him. The story of our protagonist It has all the elements for a script worthy of an Oscar: a man who was born in misery, fell into debt with his neighbors, crossed the Atlantic to settle his outstanding accounts and returned to his country. Decades after he died, he has become the greatest benefactor of his people. All this, for having donated to the nursing home in his town the shares of a rubber company that did not attract anyone’s attention. A Nurmi always pays his debts Onni Nurmi was born in 1885 in Savijoki, a small town within the municipality of Pukkila, in Finland, a town of just under 1,700 inhabitants. Nurmi grew up in a humble home marked by the hardships of being raised by a single mother who worked in the fields and ran a small canning store in the town. When she died unexpectedly at age 49, Onni was only 13 years old and had no future in Pukkila, so he moved to Helsinki. In 1912, he returned to Pukkila and resumed the family business by opening a store. However, his business did not work out. The following year, indebted to dozens of neighborstook a ship to America and spent 15 years working as a game warden in Minnesota. When he returned in 1928, he went door to door paying off every outstanding debt owed to Pukkila residents, some of them incurred a decade earlier. He didn’t do it because no one demanded it. Onni was simply that type of person. Onni Nurmi. Source: Kylä Savijoki Helsinki’s most unlikely investor With his debts paid off, Onni moved back to Helsinki, where he worked as a property manager and led an orderly, quiet life. He never married or had children. At some point he discovered investments in the stock market and, without financial training and with the only help of his intuition, he decided to buy shares of a small company that manufactured paper, rubber, rubber tires and boots which had its headquarters in the city that gave it its name: Nokia. In 1959 he wrote his will and decided to leave all the shares of that company that manufactured wellies to the municipality of Pukkila, with two conditions: They should never be sold and his donation was to be used solely for the well-being of the town’s elders. Onni Nurmi died in 1962 at the age of 77. The 780 shares he donated to the town where he had lived most of his life were then worth about $30,000, the equivalent of about $320,000 today. His gesture was undoubtedly generous, but not extraordinary…yet. The Buffett Effect: Let Time Do Its Work The clause preventing the sale of the shares seemed a problem at first. If the town had been able to cash in on the stock portfolio at any time, it would have obtained funds to improve the nursing home. However, the will was blunt on that point: shares had to be keptand they could only use dividends that these actions will generate over time. However, what seemed like a limitation to local authorities eventually became the best investment decision anyone in Pukkila could have made. The will was forcing them to apply a technique that for more than six decades has become a millionaire to Warren Buffett: leave let time do its work. Throughout the 80s and 90s, Nokia left rubber boots behind to become the largest mobile phone manufacturer in the world, position he held between 1998 and 2012. The original 780 shares that Nurmi had donated multiplied by a thousand due to its growth in the stock market and the overwhelming sales domain of their phones. At the height of the technology boom, Pukkila’s portfolio was valued at around 90 million dollarsmaking their Pukkila retirees the most prosperous in Finland, at least on paper. What do we do with so much money? The prosperity of the actions opened a new debate among the residents of Pukkila. They were sitting on a fortune and doing nothing to profit from it. In 1997, the city council proposed selling part of the shares to diversify the portfolio and reduce the risk of a hypothetical fall of Nokia. Not everyone agreed. A section of the town argued that selling the shares was against Nurmi’s will. Another sector even proposed that the benefits be used so that residents would not pay municipal taxes for 12 years. Given the disagreement, the debate reached the courts and lasted for several years. Ironically, the “Buffett effect” came into play again, and the judicial paralysis was the best possible news for the people’s coffers: while the issue of the sale of shares was being settled in court, Nokia shares did not stop increase its value. The courts finally approved an agreement by which the municipality could sell a part of the portfolio and diversify its funds, always respecting the original will of the will to support the town’s elders. as main beneficiaries of those actions. With that money the Onni Wellness Centeropened in 2008. The building stands on Onnintie Street (which in Finnish literally means Happiness Street) and includes sheltered housing, spaces for people with memory disorders, a health center, pharmacy, swimming pool, gym, library, cafeteria and a Japanese garden. All this in a municipality of less than 2,000 inhabitants. Onni Nurmi never imagined the magnitude of his donation decades after his death, but in some ways, he more than repaid the patience his neighbors had in waiting decades to pay off their debt. In Xataka | Giving money away wasn’t enough: Warren Buffett turned Christmas into an investing masterclass for his family Image | Unsplash (Pawel Czerwinski, Joe Zlomek, MW), Kylä Savijoki.
