Episode 6: The Entrepreneurial Mind

If your dream has anything to do with financial success, you need to learn something about what I call “The Entrepreneurial Mind.”

There is a very famous statement made by the writer, F. Scott Fitzgerald that goes like this: "Let me tell you about the very rich. They are different from you and me.”

Fitzgerald was both right and wrong.  The rich are very different from most people, not because they have more money, but because, if they have made their own wealth and not just inherited it, they have a way of looking at life that is simply different from most of the people in the world.   And that makes all the difference.

I call it, “the Entrepreneurial Mind”, and it is an enormously powerful tool.  It is the difference between those who rise to the top 20%--or even the top 1%--of the economy and those who wonder why they haven’t.  It is also something that anyone can learn and develop if they really want to.  

The best way I can illustrate the process of change from conventional thinking to the Entrepreneurial Mind is a very personal example.

As a young man, I used to have a fantasy that one morning I would wake up rich and never have to work again.  Then one New Year’s morning as I read the morning newspaper, I realized something:  I didn’t have to work that year—or any other year, ever!  Nor would I have to lower my standard of living or change my lifestyle.  

An even greater realization came later—and that is what I want to share.  I didn’t get to financial and personal freedom because I started out rich

Or was smarter

Or had a better education

Or won the lottery or a Las Vegas jackpot

What really happened was that, over time, using some of the techniques we have already discussed, I was lucky enough to realize that the power to change my life was within me and not dependent on anyone else’s rules. 

Your definition of success can be anything from wanting to create highly successful companies to wanting to cure cancer, but if you can’t wake up every morning wanting to achieve that goal—and loving even the tedious things you have to do to get there—then just get a job, put in your 40 hours per week, and hope that the pension they promised you will actually be there.   For some, that is enough. For me, it would have been a slow death.

But most of us are programmed from a very early age to believe that a lot of things are just impossible for us, that we are too poor, to uneducated, from the wrong ethnic group or have the wrong skin color to succeed.  Those negative belief systems can destroy our dreams.

I could tell you story after story—all true—of friends of mine who have started with nothing but a belief in themselves and achieved incredible success. One was an orphan in a war torn foreign country who came to this country with no money and without speaking English; another was a young man who had to flee from Iran after the revolution at the risk of being put to death by the revolutionaries and arrived in New York with little more than the clothes on his back; another is a woman whose mother was murdered, she herself was raped, and her business destroyed.  Yet each of these people is now extremely happy and successful.

The reason:  they each believed that they had the power to create their own success, no matter what happened to them from the outside.  And they did just that. How does one do that?  You replace every negative thought that tells you why you can’t succeed with one that says, “Why not; I can do that.”  It takes time and practice and there are many resources, books, courses, mentors that can help you get there, but the key to it all is to believe and act as if you were already the success you intend to be; and make that the overwhelming priority in your life.

Episode 8: Skills Are Investment Assets

Let’s talk about skills as investment assets.

Consider these facts:

1. No wealthy person I know depends on a paycheck to live the life they live. They own assets, stocks, real estate, businesses that work for them while they sleep or play. 

2. A quality investment can last a lifetime, and beyond. A job is only as good as yesterday’s paycheck.

Most of the World’s wealthy people, particularly in the US, did not start out with a lot of investment assets. They first developed skills that had value and then converted those skills into assets.  Every single one of the young billionaires you see in the news got that way by trading his or her skills for ownership in a company they created or helped to create.

Let me share a personal example of how these factors can work.  Early in my career, I developed some good skills in the area of finance.  As a result, I got a job with a promising company in the real estate business.  One day, I was offered a chance, along with other executives and junior executives of the company to purchase an interest in a real estate project being developed by the company in conjunction with a major insurance company.  

I didn’t really have enough money to be able to make the investment comfortably—it involved foregoing some things I would have preferred to do with what little money I had—but I studied the investment until I understood it well.  I was pretty sure I was right, and when I learned that the CEO and President of the company were also investing their own money, I decided to take the risk. For several years I got nothing back on my money while the project was being completed.  

Then something wonderful happened.  One of the two apartment developments that made about half of the total project was sold and my share was over 30 times what I had invested.  The other half that was not sold has been providing me annual income for the last 35 years that is 4 times my original investment—each and every year! 

You could say I was just lucky, but consider these things:

I would never have had the opportunity if I had not developed skills that put me in position to be offered a share in the project.

I was willing to use some of the very limited amounts of money that I had to take a calculated risk on something that might move me up the economic pyramid. Notice that I did not take a Las Vegas type risk.  I wasn’t gambling. There was ample evidence from the actions of the more senior executives and my own research that this was probably a good investment. It was not a sure thing; nothing is; but the ratio of risk to reward was in my favor.

What I didn’t know then, but have learned later, is that this kind of opportunity happens far more often than most people realize. I even made an investment a few years ago that returned 100 times my original capital.  It was not without risk, but I had developed over time the ability and confidence to think that by using wisely the skills and capital I had, I had a much better chance of winning than losing and that the profits from my winners would far outweigh any losses on my mistakes.  That is the formula for wealth.

Above all, it started with my developing skills that other people wanted and needed, not just having a job.  In fact, the skills that led to that investment were developed through 4 different jobs that I held until I had learned all that I thought I could from them.  Then I moved on and added more skills.  Skills are assets and are worth more—and are many times more secure—than any actual job you will ever have.

Episode 9: Converting Dreams To Goals

There is profound truth in the saying, “If you don’t have a dream, how are you going to have a dream come true?”

But it sometimes needs to be changed to this: “If you don’t have a goal, how are you going to achieve it?”

The difference is profound.  A dream is something that floats in the air of fantasy and always in the future, a bit out of reach.  A goal can be seen, can be measured, and progress toward it can be charted. And when you reach a goal, there is the chance to celebrate that you have accomplished something important.

Equally important, having clear—and preferably big and audacious—goals is the only way one can measure achievement.  Think about the first manned space flight to the moon.  That was a Big Audacious Goal, particularly when you recall that the US started that program before we had ever even flown in space and the whole mission was accomplished using computers that were not as powerful as the smart phone in your pocket.  

The other remarkable thing about that achievement (and it is true of every successful entrepreneurial venture I know) is that most of the time that moon rocket was off course. Minute course corrections and adjustments were constantly being made.

But, those corrections would have been impossible without a very clear goal.  Unfortunately, the goals in our entrepreneurial dreams are not always that clear. But they need to be.  Otherwise, you never know if you are off course or not.  

One of the drills that every entrepreneur should do—and few actually do—is to spend a ridiculous amount of time developing a very short and simple description of what the goal of the business he or she is creating should be.  

I’m not talking about those lofty and vague “Mission Statements” that the textbooks on entrepreneurship often tell you to write.  If you can’t describe in one or two sentences what your business is designed to do, you probably haven’t given it enough thought.  Think about the statement, “The Ultimate Driving Machine”.  No one with any exposure to TV or radio advertising will fail to recognize that as the tag line for a BMW auto product.  But is also one of the finest descriptions of a business goal I have ever heard.  A million things have to come together actually to build that automobile, but asking, “Will this help create the Ultimate Driving Machine?” can be the test of every decision that is made.  Is what we are about to do getting closer or farther away from that goal?” That kind of clarity has real power.

I’m not arguing that BMW has achieved their goal, but could anyone in that company possible not know what the goal is?  If you can articulate what your business is designed to achieve that clearly—even if it takes a few more words—you will be well on the way to achieving that goal.

It all starts with clear goals.  Without them, you will never know if you have succeeded or failed.

Episode 11: The Myth of Someday

There is a myth that pervades the way most of us were brought up that success will somehow come (if it ever does) in some future “someday” because of a fortunate promotion, “being discovered” or gradually working our way up some ladder of success. 

Any of those things could happen, but what makes this way of thinking so destructive is that it ignores one of the most powerful tools we all have—the power of the mind. I know of no formal study that has ever been made, but my own experience with successful entrepreneurs--and what I have read about others whom I have never met convinces me that in almost every case, those people believed in the core of their being—long before they actually became rich or famous—that they already had the keys to wealth and success within them and did not need anyone else to say “attaboy.”

There is a much abused saying, “Fake it until you make it.”  But behind that glib phrase is a powerful truth.  If you can wake up every morning already knowing in your very bones that success is already inside you, the subconscious mind takes over and seeks out ways to make that happen. We have talked about this already, but it is worth repeating—often.

That doesn’t change the fact that most successful people have spent thousands of hours developing their skills before they achieved what the world often thinks is “instant success”.  But what most people miss is that just spending those thousands of hours is meaningless without the core belief that “I am already a success” and the equally important definition of clear and definable goals.  You could say, “I am destined for success”, but that is not as powerful because it puts success in the future.  The real success is the day you begin to see yourself as successful now, with the cars and houses and other badges of success to come later.

I told you earlier the story of my own imaging of my success. But all the while I was waking up each day and seeing my dream as a reality, I was still doing all the things I needed to do to build my first business, working long hours, adding to my education, and planning ahead. 

Notice two things in my story:

I still had to put in the thousands of hours needed to achieve the financial rewards I wanted, but once I made that image of being successful already a part of my mental DNA, those hours no longer seemed like work, just part of the course I had to run to a finish line that I already had reached in my mind.

 What I didn’t tell you was that when I reached my goal, I made a terrible mistake:  I neglected to set a new set of goals.  The result was that I drifted for a lot longer than I like to remember, feeling discontent with my success, until I woke up one morning and realized I needed a new set of goals.  Then life got exciting again and I started the first of the next 9 companies.

Episode 12: Money

Let’s talk about Money. We can’t talk about the tools of success without talking about it. Most everyone thinks they know what “Money” is.  And most everyone is wrong!

Some people say, “Money is the root of evil”.  It’s not.  The real quote is: “The love of money is the root of evil”, which is a very different thing.

In fact, until you do something with it, money has no value at all.  You can’t eat it; you can’t drink it; you can’t wear it (except perhaps as a silly costume), and it won’t keep you warm—unless you set it on fire, but that won’t keep you warm very long.

I recently visited the Federal Reserve in Los Angeles where they have a room about the size of a football field completely filled with US currency.  It is quite impressive and actually “smells like money.”  But as long as it sits in that room it is totally useless.

But when you do something with money, it can become an incredibly powerful tool.  And that is the way to think about it. It is a tool!  No more; no less.  It is a lot like those incredible Swiss Army Knives I grew up with that have blades for almost any task you can think of, whether cutting a steak or putting in a screw. It can be used for almost anything. 

Once you begin to think about money as a tool, like a hammer or a screwdriver or saw, but incredibly more versatile, you have taken the first step toward using that tool to change your life and the lives of those you love.

The really interesting thing about money is that is a tool that can be made to grow to any size you need it to be to accomplish what you want to do. If you need something small like a hamburger, money can make that available to you.  But if you need something bigger like a house or an education for yourself or your children, it can do that to.  And if you want to build a huge business to try to cure cancer, it can do that too.

And here is the amazing part—even if all you have at the moment is the money for the hamburger, you can make it grow to any size you need it to be. And I really mean YOU!  Not someone else, not some nameless corporation, and above all, not the government—but YOU or anyone who truly understands how the tool called money really works.

The bad news about that is that most people will never understand how to use the tool called money and will spend their lives envying those who do—and buying lottery tickets while waiting for their “luck” to change.

The good news is that if you are hearing or reading this, you are already on your way to becoming one of those people who understands how to use the tool called money to change your life.

It won’t happen without work, but if you truly want to succeed and are willing to spend the time and effort to understand what money is and how to make it work for you—as a tool, not your master or a goal in itself—you are already on the first step of the ladder that leads to the top of the pyramid.

Episode 13: Freedom and Happiness

You have no doubt heard it said, “Money can’t buy happiness.”  And that is true.  I know many unhappy millionaires.  But I know many more unhappy folks whose lack of enough money to feel safe in their daily lives creates its own unhappiness.

The truth is that having enough money cannot assure happiness, but it can assure freedom from many of things that can turn even a happy life into an unhappy one.

It is hard to be happy and joyful if:
you are not sure how you will pay the rent,
or the car payment,
or a trip to the doctor,
or tuition for next semester.

But now I have to tell you the secret most people will not tell you: having a good job is not enough.  That is a dangerous belief to have—and yet it is all around us.

When I apply for a loan to refinance one of my pieces of real estate, the first thing I am asked to provide is a copy of my W-2 (the form you get each year to prove your salary and tax deductions) or a copy of my last two paychecks.

Since I have not worked for a paycheck for over 40 years, it always takes a while before I convince the borrower to look instead at the assets that provide enough income to pay all my loan payments many times over, whether I ever work a day or not.

What the people who write those loan applications don’t realize is that a job is the most vulnerable—almost useless—asset you can have. The only asset that really matters is the skill to make whatever money you need, no matter what.  Even having stocks and bonds and real estate is not as valuable as understanding how money works and how to create it in your life.  You can lose the stocks and bonds and real estate through bad investing or a market collapse (although you never will when you really understand how to use money as a tool), but your skills will always be there as long as you have health and strength to use them.

Don’t misunderstand.  It is important to build tangible wealth because someday all of us will be too old or too ill to use our skills, but without the skill of understanding how to use money as a tool for better living, none of your assets are safe.  However, if you use the job you have to build skills that will survive the loss that job, you are well on your way to the kind of financial security that means you will never have to fear losing a job again.

I have worked for two different very big companies that became insolvent and had to be sold for pennies on the dollar—and with that sale, my job disappeared almost overnight.  Yet the collapse of those employers and my job with it—had almost no impact on my life except to force me to look at new and better opportunities.  Why?  Because the skills I had gained could be translated into other jobs or—in my case—new businesses that created wealth and income without my having to work at all in those businesses.  That leaves me free to pursue other dreams.  And it all starts with the knowledge that knowledge and skills, not a particular job, are what creates financial freedom.  We’ll pursue that thought in the next blog.

Episode 14: Building Wealth

Everywhere you turn today, you hear people lamenting the income gap between the top 10% of earners and the bottom 50%, or below.

Those people are half right.  There is a big difference between those who earn the most and those who just barely get by. But, as we will discuss in detail later, it is not a gap but a pyramid, something else much easier to manage. The reality is that anyone who learns the skills they need and develops the mindset of the wealthy and not the poor can create wealth and never have to work again.

But first, let’s look at what will not work:  a better job or a raise will not get you there.  Think about it.

In the US, to join the top 10%, you need an income of about $250,000/year. That is the equivalent of a salary of $125/hour.  The average family income for those who work for a salary is about 10% of that.

There just aren’t that many jobs like that.

And, any job you have can be gone tomorrow.

So what will work?

There is a sign in Malibu, where I live, that says, “One good investment is worth a lifetime of toil”.  That is absolutely true.  

To create real financial security, what you need is to create Wealth

A job is not Wealth. A job is just income that can be gone tomorrow.

Wealth means that you have created investment assets that will work for you 24 hours a day.  Wealth will provide for your retirement, help launch a career for your children, or fund a charity you love. If you build Wealth, having “a better job” will never matter to you again.

But how do you start if you don’t already have money?

To create Wealth, you need assets to invest.

But, cash is not the only asset.  Skills are also an asset

So forget about just getting a better job.  A job--even a very good one—can be gone tomorrow. Instead, look at any job as an opportunity to learn skills and turn them into assets.  A job is a tool—nothing more. It is a tool to help build Wealth and Financial Freedom.

There are two basic ways to convert skills to assets

Seek Ownership Opportunities.  Whenever possible, find jobs where some equity in the business is part of the pay package.  Most of the new billionaires that you read about did not start the company that made them rich; they joined it when it was young and took part of their pay in equity.  Steve Ballmer, who is a billionaire and just bought a basketball team in Los Angeles, started out by going to work for a little start-up company called Microsoft.  In the beginning, there were some risks, but he undoubtedly knew that he had the skills to try again if the first company failed.  

Use OPM. That is just an abbreviation for “Other People’s Money”, and it is what you can attract if you develop skills that other people either do not have or do not have the time to use.  I have a friend who just a few years ago suffered the complete collapse of the business he was in through no fault of his own.  In less that 5 years he has built a new business in a field he was never in before that provides him a nice house, college tuition for his children and expensive vacations for his family. The secret was two things: he had developed skills that could be used anywhere (which we have talked about, and he knew he would need money for his new business and used the skills of language and persuasion that we have also talked about to convince other people with lesser or different skills, but who had money, to invest with him.  He has made himself rich and his investors richer.

I built my wealth the same way and anyone with marketable skills can do it—so develop those skills!

Episode 15: Wealth Building Tools - Corporations

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We hear a lot of talk these days about “corporate greed” and many people, particularly young people, believe that their chances of success are being “oppressed” by the power and greed of big corporations.

Let me let you in on an important secret: there is no such thing as “corporate greed.”  To understand why that is true requires that we realize that corporations are nothing more or less than tools and the greed or altruism associated with them is no more or less than that of their owners.

Thinking of corporations as some kind of enemy and failing to understand how they really work is a recipe for the failure of dreams.  Think a bit about these things:

1. A corporation is a tool that enables someone with a dream to pursue it without fear that one mistake could destroy everything they have built or created for themselves or those they love.  Suppose you made toys that children loved and were selling like crazy and both children and parents loved them.  Then one day, through no fault of your own, a child injures itself with one of your toys and you are sued for millions.  If the business were a corporation, that could still be very bad, but losing that suit would not mean you lose your home or your car or your savings.  Only the business would be at risk.  A loss would be traumatic, but you could begin again.  That is what corporations do.  They separate the owners’ personal assets from the risks of running a business.

2. That separation is what makes it possible for an entrepreneur to find the capital needed to start a new business.  No one would have invested in Tesla Motors if they ran the risk that one defective automobile could wipe out their life savings.  The same would be true of Uber, or Google or any other successful company.  A corporation is what makes it possible for almost all the new innovations, from iPhones to electric cars, to happen.  Without that thing called a “corporation”, no one would risk their money and nothing would ever get done.

3. But can corporations be used for evil?  Yes, of course, and in time they will almost always be found out and go out of business.  But that will not destroy the lives of the people who innocently believed they were investing in something good.  The founders and managers of the corporation may have great difficulty ever getting money for their next venture, and in some cases might go to jail, and the people who invested will lose their investment---but not their most cherished personal assets.  That is the magic of a corporation, and its power to do good as well.  

4. A corporation is a tool, an incredibly useful one without which your chance and mine of success would be much less.  I use a separate corporation for each business I create or invest in and that enables me to enlist others to invest their money with me because we both know that failure will not destroy us and we can recover to build a new great business.

Episode 16: Zero Sum Games

Dream Toolbox - Zero Sum Game.jpg

Welcome back. We need now to talk a bit about one of the most important concepts you can ever learn about building wealth and financial freedom. It is actually quite simple and can be summed up in one phrase: “Success is not a zero sum game.”

What does that mean? Think about any sports contest. Whether it is baseball, football, or any other competition, there is only one winner. Second place is only the first loser. But financial success is not like that. Think about Apple Computer, the most valuable company in the world as I am writing this. One of the reasons that Apple is so successful is that it has created platforms for apps on which independent developers can produce and distribute apps that
can make their creators very wealthy very fast.

But consider this: everytime one of those app developers creates a successful app, Apple computer gets richer. But this is an important distinction. Apple does not get rich by making the app producer poorer. It gets rich by making the app producer richer. This is the exact opposite of a zero sum game. It is a game in which success by one party increases the success and wealth of the other. That is how business in a free society works at its best.

Are there exceptions? Sure, in some rare cases there is competition in which there is only a winner and a loser. I own interest in a company that frequently bids on US and foreign contracts. These can result in revenues of 10’s of millions of dollars. In those bids, there is only one winner. But notice something even here. In order to increase our chances of success, we often form partnerships with companies who have skills our people lack. That increases our chances of winning the contract. But it also means we have to share the income from the contract if we win.

Is that bad? No, quite the opposite. By sharing the wealth and the skills of two companies, we increase our chances of winning more contracts. Thus, even where there is a clear winner and loser, the players who share skills and profits are more likely to be successful than those who do not.

Let me give you another personal example. Many years ago I was part of a team that was helping and owner decide which of several bidders was going to acquire some real estate worth hundreds of millions of dollars. One investor was the clear favorite, but he made a crucial mistake. He tried to drive such a hard bargain that no one else could benefit. My clients heard his pitch and walked away from the negotiations. In business you often hear the saying, “you have to leave something on the table for the other guy”. This bidder did not understand that. He wanted it all. What he got was nothing and another bidder, who offered some attractive benefits to the seller, my client, won the contract. He gave up something in the beginning but ended up one of the richest men in the world as a result. He understood that Life (and business) is not a zero sum game.

If you can apply that principal in life and business, always looking for ways to make those around you wealthier as well and looking for ways to make the result of your efforts greater by cooperating instead of wanting everything for yourself, you have taken a giant first step toward success.

Success in business is not a Zero Sum Game. If you try to make it one, you are almost guaranteed to lose. Help others succeed and you will help yourself.

Episode 18: Failure vs FEAR Of Failure

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Believe it or not, one of the biggest obstacles to achieving financial freedom and an abundant and successful life can be summed up in three words: FEAR OF FAILURE. Notice that I did not say, Failure. I said Fear of Failure. In reaching any goal worth having there will be failures along the way—often many of them. No, it is the Fear of Failure that dooms most people to lives of frustration, living far below their potential.

The reasons are actually quite simple. Fear of Failure does several things, all of them bad.
1. It persuades us never to try, or
2. It makes us give up on ourselves or our dream at the first major barrier,
3. It paralyzes us at exactly the times when bold action is needed.
4. And, it undermines the inner belief of “I can do that” that we have talked about already and are starting to build.

But to deal with the fear of failure, we first have to look the possibility of failure in the eye. Every time I start on a new project that I think has any risk of failure, I do something that most of us find very uncomfortable. It is not comfortable for me either, but I have learned that doing it is one of the best predictors and guarantors of success I know. What is that something?

Before I ever take action, I ask myself these questions:
1. “What is the worst thing that could happen if I try this?”
2. “Can I survive if the worst thing goes wrong?” I’m not thinking about the kind of physical survival that could happen in a war or natural disaster I mean can I survive it economically and can the relationships that I cherish survive it.
3. If the worst happens can I do more than just survive the failure; can I rebuild my dream and try again?

My experience has been that in almost all cases, even the worst case situation can be overcome, but looking at the risks squarely, in the beginning, takes the fear out of the equation.

Fear of Failure is the biggest cause of actual failure, usually because of one basic reason: Fear of failure causes us to give less than our best. It is human nature to build in an excuse, “I could have succeeded but I didn’t have the chance to give it my full attention.” Whatever that excuse is, banish it from the beginning. It is a little scary to put all your hopes and dreams into a project, but anything less almost guarantees failure. There is a saying, “Don’t put all your eggs in one basket.” Mark Twain turned that around into a saying that is much better when you are talking about committing to a project. His phrase was, “Put all your eggs in one basket: and watch that basket.”

The lesson from all this is very simple: Look the risk of failure squarely in the eye and decide if you can deal with that risk if it happens. If so, commit completely and make sure that failure doesn’t actually happen.

Every successful business I have ever created has had one or more “near-death experiences” in which failure was possible. But because I had faced those possibilities in advance and was committed to success in spite of those risks, I managed in almost every case to turn potential failure into success. Out of 11 businesses I founded, one did fail, but the failure was of the business. It was not my failure and I went on to more successes. You can too.

Episode 21.  Luck and Preparation

Dream Toolbox - Luck and Preparation

I have noticed that most people when they meet or hear about someone who has been highly successful think to themselves, “Wow, how lucky he (or she) must have been to be where they are.”

The reality is that, although there is an element of luck in every success, there are many people who somehow manage to be “lucky” a lot more than most of the rest of us.  There is a reason for that and it is summed up in this frequently quoted statement: 

Let’s talk about good luck first.  When we exclude such things a winning a lottery or inheriting a fortune from a long-lost relative, almost all luck is a matter of recognizing and acting on something that others do not see as an opportunity.

A dear friend recently told me the story of her parents. They were immigrants who lived in a Midwestern city, had worked hard all their lives, and lived a prosperous middle class life.  But they had not reached financial freedom because they still needed to work every day to keep the revenue coming in.  One day, my friend recalls, they commented over dinner how cheap land was in the United States where one could buy land around the city they lived in for $100 per acre.  Although they were not rich, they could easily have bought quite a few acres of that land that would, in time have made them wealthy and secured their children’s future.  

Instead, they just noticed it, but did nothing.  In their case, that failure to act was primarily a function of the culture from which they came in which such investments were not common because ownership of property was not protected well by the law—one of the great benefits of living in the United States.  But how many native born Americans read the same newspaper article, but failed to take the action that would, today, have made them wealthy and financially secure. But they did nothing.

Why not?  I submit to you that the reason was a function of two things:

Failing to prepare their minds to look around them on a daily basis for opportunities that others were simply not seeing or were ignoring; and

A fear of taking a risk that might lead to a loss instead of a profit.

We’ll talk about fear of risk shortly, but let me give you another example of the difference between looking at the world with entrepreneurial eyes or failing to do so. I read recently about an entrepreneur who made his first fortune many years ago when about 25% of the paper currency in the United States was backed by silver.  Recognizing that silver was also used in industry and might in the future be worth more than the currency, he began buying paper currency that was convertible into silver and, when silver prices grew beyond the value of the currency, he converted the currency to silver and, I am told, ended up making over $100 million dollars.  

Why didn’t everyone else do the same?  It was printed right on the currency, “Silver payable to the bearer on demand.”  He saw that as an opportunity.  Most of the rest of us just noticed it and did nothing.  I was one of those who did nothing and had to make my fortune another way.  Buy why? I, like so many others, had not yet developed the habit of looking at the everyday world around me as the candy store of opportunities I now know that it is.  None of us will recognize all the opportunities, but failing to prepare our minds to see those opportunities is preparing to fail.

However, I later did notice that there was a lot of interest in using some things called “stem cells” as a potential way to treat diabetes.  This time, I recognized the importance of what I was hearing and remembered that I know a scientist who was one of the leading cell biologists in the world and was looking for a new job or project.  A few years later I was CEO of a public biotech company worth over $100 million dollars.  Not all of that was mine.  We had many investors, but it started because my partner and I saw something most everyone else was ignoring and took some risk to test our theory. 

It all starts with preparing the mind to see opportunity where others see either nothing unusual or see problems instead of opportunities.