IKEA: How a Teenage Entrepreneur's Match-Selling Side Hustle Became the World's Largest Furniture Empire

Ingvar Kamprad was five years old when he started his first business. He bought matches in bulk from a shop in Stockholm, then sold them individually to neighbors in Älmhult for a small markup. By seven, he had upgraded to a bicycle and was ranging farther out into the Swedish countryside. He tried fish, Christmas decorations, pencils. The margins varied; the method didn't. Find something people need, source it cheaper than they can, move a lot of it.

That logic, applied at scale across eight decades, produced IKEA — a company with €45.1 billion in annual retail sales, 483 stores across 63 countries, and an ownership structure so legally labyrinthine that no one can buy it, inherit it, or easily tax it.1

A company built from a school reward

In 1943, Kamprad was 17. His father, pleased with his academic results, gave him a gift of money. Kamprad used it to register a mail-order company in Älmhult, the village in Småland where he had grown up on the family farm, Elmtaryd. He named the company with an acronym: I for Ingvar, K for Kamprad, E for Elmtaryd, A for Agunnaryd, the nearby parish.2

The early catalogue sold whatever Kamprad could source cheaply: fish, Christmas cards, pencils, wallets. Furniture arrived in 1948, almost as an afterthought. But it stuck. Sweden in the late 1940s was rebuilding, young families were moving into apartments, and decent furniture was expensive. Kamprad had found a more stable product.

By 1951 he had dropped everything else from the catalogue. By 1953 he opened a showroom in Älmhult so customers could examine the furniture before ordering — an unusual move for a mail-order business, and an early indicator of what IKEA would become: a place people went to, not just a service they used.

The first proper IKEA store opened in Älmhult in 1958, under the name Möbel-IKÉA (Möbel meaning furniture in Swedish).3

The accident that changed furniture

In 1956, an IKEA designer named Gillis Lundgren was trying to load a table called the Lövet into his car. It wouldn't fit. Lundgren's solution was immediate and practical: he unscrewed the legs and packed them flat alongside the tabletop.4

The insight wasn't that furniture could be flat-packed — it was that flat-packing solved two problems at once. Customers without a car or delivery service could now carry furniture home on public transport. IKEA could ship far more units in far less space, which cut freight costs enough to lower retail prices. Self-assembly transferred some of the labor to the customer in exchange for a lower price — a trade millions of people would accept.

The Lövet became the template. Flat-pack, or ready-to-assemble design, eventually ran through almost everything IKEA made, and the format has since been copied by virtually every furniture company on earth. The Billy bookcase — also designed by Lundgren, introduced in 1979 — has sold over 140 million units.5 At last count, one Billy sells somewhere in the world every five seconds.

The flat-pack catalogue also generated a side effect Kamprad hadn't planned: the experience of assembling furniture at home became part of the brand. Psychologists later named the phenomenon — people tend to value things they have built themselves more highly than things they received finished. IKEA had stumbled into behavioral economics before anyone had named it.

The part of the story Kamprad avoided discussing

In 1994, a Swedish journalist published a book revealing that Kamprad had been a member of the New Swedish Movement, a fascist organization led by Per Engdahl. Kamprad had joined in 1942, at 16, remained active until at least 1945, and maintained a personal friendship with Engdahl into the early 1950s.6

Kamprad issued a public letter acknowledging this, calling it "the greatest mistake of my life," and attributing it partly to the influence of his father and his German-Sudeten grandmother, both of whom had sympathized with Nazi Germany. He framed it as youthful naivety, born in a rural corner of Sweden that was geographically and ideologically close to the Continent's far right.

The story didn't fully close there. In 2011, new archival research showed that Kamprad's involvement had been more active than he had admitted: Swedish security service records from 1943 — the same year he founded IKEA — showed him recruiting for the Swedish Socialist Assembly (SSS), another Nazi-aligned organization. In a 2010 interview, he had still described Engdahl as "a great man."

Kamprad never fully reconciled these facts with the brand's stated values. He died in January 2018 at 91, in the farmhouse in Småland where he had grown up.

The tax architecture

By the mid-1970s, IKEA was large enough that Sweden's inheritance and wealth taxes posed a genuine threat to Kamprad's ability to keep it intact. His response was characteristic: he moved, and then he restructured.

In 1976, Kamprad relocated to Switzerland with his Swedish wife, settling in Epalinges near Lausanne. He would live there for nearly 40 years.3

More consequentially, in 1982, he transferred the majority of IKEA's operations into a Dutch foundation called Stichting INGKA Foundation, headquartered in Leiden. The foundation owns INGKA Holding B.V., which controls the Ingka Group — the entity that operates the majority of IKEA stores worldwide. As a Dutch foundation, Stichting INGKA has no shareholders and pays no dividends. It cannot be acquired. No individual owns it in any conventional sense.7

The brand itself — the trademark, the concept, the product design and supply chain — sits in a separate structure called Inter IKEA Systems, owned by Interogo Foundation in Liechtenstein. Every IKEA franchisee, including the Ingka Group's own stores, pays 3% of revenues as a franchise fee to Inter IKEA Systems. This fee flows through a jurisdiction with considerably lighter tax treatment than Sweden or the Netherlands.

In 2006, the Economist estimated Stichting INGKA's endowment at $36 billion, making it the world's largest charitable foundation by assets — larger than the Bill & Melinda Gates Foundation at the time. The word "charitable" is used loosely: the foundation's original stated purpose was to promote innovation in architectural and interior design.

The structure has been scrutinized by European tax authorities for decades. A 2016 report commissioned by the Greens–EFA group in the European Parliament estimated that IKEA had avoided roughly €1 billion in taxes over six years through arrangements between its operating entities. IKEA has consistently maintained that all arrangements are legal, which they appear to be.

What IKEA looks like now

The company Kamprad built is difficult to describe in standard corporate terms because it is not a standard corporation. It is a franchise system nested inside a foundation nested inside another foundation, generating revenues that belong to no person and cannot be distributed to any owner.

In FY24, total IKEA retail sales reached €45.1 billion, down about 5% from the prior year, a drop IKEA attributed primarily to deliberate price reductions across 63 markets rather than a loss of volume.1 Online sales now account for 26% of all transactions, with 4.6 billion website visits per year. The company employs roughly 216,000 people.

IKEA closed all 17 of its Russian stores in 2022, following the invasion of Ukraine. It opened its first store in India in 2018, in Colombia and Chile more recently. It remains one of the few truly global consumer brands — present in markets from Malaysia to Saudi Arabia to Peru — without a single controlling shareholder, a listed stock price, or a conventional exit.

Kamprad's three sons serve as stewards of the broader vision through Inter IKEA Holding's governance structures. They are not owners in any direct sense. Neither is anyone else.

The matches were never the point. They were proof of a method.