This book, 'How to Get Rich' by Felix Dennis (400M-900M net worth- he doesn't exactly know), published in 2006, basically destroyed my corporate career and put me on the path for 'Start-Up/New Company Hell'. It is an extremely dangerous book and it misses an extremely key business knowhow which I learned the extremely difficult way over the course of the last two years. It is an extreme book.
For this first part, I wanted to grab the bulls by the horns and talk about what no one really wants to talk about, the entire idea of doing business to become Rich. Shocking, rampant materialism and disgusting to most, underlying all of that is a mentality that in doing a business that you own, it takes more than guts and a hope for glory, but to be totally fearless in taking that first step.
The Business of the Mentality
I start off this series of business mentality knowhow with the book that has gotten me in a lot of trouble from my wife and my relatives who basically see me as throwing away my entire stable corporate career to run start-up/new companies.
For me personally there is a distinction between what is a start-up and a new company. A start-up being a high tech or IT based company with a unique product or in a fast growing market, where a new company is simply a new company in a mature or existing market. That being said, I am involved with the running of 4 companies, not all the same time mind you, but I have commitments to all 4 to various degrees. But before all that, what got me on this track off my cushy fat cat corporate career track was this book.
Felix the Coke Snorting Fiend!
Felix Dennis, by his own accounts was a coke snorting, call girl addicted fiend, until he nearly died from that lifestyle. And now he is a patron of establishing forests in English and is a poet. He picked the name, 'How to Get Rich' for his book, not because he has no style, but he just wanted to pick the most direct base name for it. With a title like that, it is an absolutely embarrassing book to be carrying around. I once was flying from London back to Hong Kong on British Airways business class and I was reading this book now for the 3rd time and I fell asleep. In the aisle next to me were two fat Scottish business women who couldn't stop talking and enjoying their trip. They wore big gaudy big rings, heavy makeup and definitely were senior management of some big company. They obviously were use to the finer things in life.
So as I was napping, this book, "How to Get Rich" had fallen in between the aisle. It was tough falling asleep because of the two Scottish magpies, so as I was half dazed, I saw the stewardess pick up the pick and say to the ladies, 'Excuse me is this your book?' and the Scottish magpies look at the cover and started to laugh, 'How to get rich, hahaha, no it is definitely not ours, hahaha', and I in a half daze put up my hand and say, 'it's mine, thanks'. The scottish fattie magpies looked at me still laughing and obviously thought I must have been upgraded from economy and continued their 10 hour cackling. But I didn't care, at the time, this book was haunting me.
In business there are many different fields and areas, each one with their own set of knowhow and procedures and mentality. But among the different fields of industries from accounting firms to manufacturer to media agencies, there is a more fundamental divide, the divide between being an equity holder and an executive staff.
Being Smart Ain't Great Business is one of those professions where being really smart usually works against you. The reason why is because business fundamentally is about the practical application of theory in tangible phases of development. i.e. mostly about operations (consistency and focus). So if you see an awesome business on the news which is a multi-billion dollar enterprise, or even an international fashion brand, chances are it has been around for 10-15 years and has been built up over time in tiny steps. Sure there is the googles and facebooks, but you can literally count them on one hand, whereas there are thousands of companies that make in the 10-30m region of profit every year with only companies the size of 20-50 people and is nothing to be scoffed at. For the most part, business required dedicated and step-by-step effort, except for one part. The start.
The Black Hole At the start of a business, there are no employees, no executives, and most times, no capital. At the actual start of a business, is a single person with an idea, passion and will to take a risk. And while it is a calculated risk and may not be seen as a risk to the 'entrepreneur' as they may believe that they have all the bases covered and the new business is not a risk, per say, rather just something that will happen; relative to someone who has always worked to for a monthly paycheck or annual bonus, it is a massive risk. It is a massive risk against that stability of having a monthly paycheck and that risk only increases in size the more you climb that corporate ladder.
Trying to be Rich Sucks Felix's book really is aimed at flushing out that point and actually starts by saying everything he can to dissuade anyone from thinking that 'getting rich' is a good thing. If you want to plunge right into the deep end of understanding how the business wealthy in the world understand wealth, then this is more than a primer, it is as much personal knowhow as you're going to get from anyone at his caliber.
Fundamental to Felix's outlook to becoming rich is being on the equity/owner side of things; he has no problem giving out big salaries and bonus, but he rarely gives out equity/ownership. For the most part, if you're looking to be stable, being a high paid executive is a crappy way to go as well. But if you're looking to be very stable with the ability to buy most consumer and luxury goods at a whim, then being a high paid executive is the way to go.
From my experience, at 30k a month after taxes, you can pretty much live to the highest middle class standards as possible; you can have a couple of 100k cars, send your kids to private school, buy nearly anything you want without any care, with the exception of couture level goods (D&G, Channel,etc). At 30k monthly after taxes, you usually run out of things to buy by the 3 week of each season and unless you collect watches or cameras (in which you realize 30k isn't that much), you stop thinking about consumer goods after a year at living at that level. Even among the very wealthy, there is very little difference after 100M of liquid (i.e.cash equivalent) wealth i.e. private jets etc (not my personal experience, but what I've been told by clients).
Business Can Make Somethings Better But for a moment, withhold your judgement as to the gross material consumerism presented here, what if, you actually enjoy doing business as profession? What if all the bells and whistles aren't something you care for and you'd rather just donate the money to charity. I'm not saying I'm not that guy, but my point is that for those not in business, the main reason why we don't even try to learn about the mechanics of business is because we don't want to be associated with the materialism it represents.
Say you are an inventor, having a good business fundamental back your invention allows you to do more and make your products a reality and even allows you to control how your products are used rather than being a slave to your finances.
Say you create local manufacturing businesses that employ the local community, well you're going to have to run it damn well if you're going to compete with countries with considerably lower wages.
Or say, you simply want to be the best in the field, that you really take business as profession like law or an athlete and simply want to be the best at what you do, in this case, wealth is a by-product of that achievement and truthfully, if buying things is really want you are after, making more than 400k annually after taxes does the job.
Without a Safety Net
So for Felix, the entire quest to become rich is not for happiness or fulfillment, rather it is a conscious decision to take a walk without any kind of safety net and go through some serious bruising. He has a check list for the mentality required to proceed with the entire affair. But before I get into that, I'll say that this list and one other thing, was really what I got out of this book. The advice that he gives in later chapters about running a start-up and being focused and delegating etc, you can find in most other high quality books (his advice is no less valid), but what is unique about the book is this following list and that he tackles that fear of the 'start'.
So here is Felix's list from 'How to Get Rich' if you can check even one off, you're disqualified:
1-If you are unwilling to fail, sometimes publicly, and even catastrophically, you stand very little chance of ever getting rich.
2-If you care what the neighbors think, you will never get rich.
3-If you cannot bear the though of causing worry to your family, spouse or lover while you plough a lonely, dangerous road rather than taking the safe option of a regular job, you will never get rich.
4-If you have artistic inclinations and fear that the search for wealth will coarsen such talents or degrade them, you will never get rich. (Because your fear, in this instance, is well justified.)
5-If you are not prepared to work longer hours than almost anyone you know, despite the jibes of colleagues and friends, you are unlikely to get rich.
6-If you cannot convince yourself that you are 'good enough' to be rich, you will never get rich.
7-If you cannot treat you quest to get rich as a game, you will never be rich.
8-If you cannot face up to your fear of failure, you will never be rich.
This is a brutally heavy list, and on my best day, I would barely be able to 'yes' to all of them and on my average days, I could stare at this list all day and probably not come to firm answer. Whether you think this is ballsy or just dumb to have this mentality, honestly, I have to agree with him on these points, if your objective is to be rich and you ain't a nerd who can actually build something.
For those who are in their teens or early 20's, probably more out of naivety would you be able to say yes, or lack of responsibilities, but that isn't a bad thing when really, the one major thing that holds you back is, fear of just starting. Felix does mention, that a few can have their cake and eat it too, meaning that for some they can be rich by doing what they love, but it isn't the norm.
Nerds Rock the Free World, Finally
In many ways, Felix's mentality is a bit outdated because we now have things like crowdfunding like kickstarter.com and also Y Combinator Seed Fund. Technology has allowed the cost of making a mass market product or service considerably less. You can source products from alibaba.com from China with just an email when back in the 90's if you didn't fly there and spend a month sourcing things for quality you just couldn't do it. It isn't a completely a vicious world where only the strong survive to get the cash, the geeks and nerds are doing it really well by essentially harnessing new media and technology. Sure, amassing a large army is great, but if your national banking system gets hacked by some foreign nerd army unit, you're not going to be invading anyone any time soon. So times have changed and those same changes allow me to manage or be a part of 4 different start-up ventures. That being said, I would say the list above is no less relevant and the road no less difficult.
1 in a Million? The passage that stuck out to me about this book was the following:
"In nearly forty years of doing business, I know of only six senior managers or professionals between forty and fifty who struck out on their own. And two of those were lawyers.
One did very well indeed with his own law firm. Two of them did fairly well. One went belly up and never recovered financially. One threw in the towel and owns a tiny bar on an island in Croatia. The remaining one shot himself when his venture collapsed. None f them became really rich.
Yet you picked up this book. You're still curious. You're still hungry. Read on, my learned friend. 'How to Get Rich' may subvert you yet, though I very much doubt it...
The only question is: will you dare to try? If you will, then you are one in a million. Or two million or three. Your chances are slim, but they are not impossible...(Dennis, How to Get Rich: Chapter Pole Position last 2 pages)."
The problem with me is that I love a good fight, I love to be the underdog and because if you can win as the underdog, you can dominate when you have the advantage and you get confidence in being that guy that takes the buzzer shot. I read this book, cover-to-cover about 8 times. It's not a long book, it will likely take you a couple of days to read, but like everything with great insight or knowhow, you re-read it to really internalize it. That particular passage, I've probably read it 50 times at least. I seriously, hate/love this book, in that order, but after 2 years, I'd say, the chances are near impossible for a senior corporate executive to switch gears like that. I have barely survived the ordeal.
Corporate Rambo By 33, I'd say I was one of the top executives globally in my field and I wondered if there was more. I read a lot, usually a business book a week, but nowadays not much, unless it is about a major event like the Madoff or 2008 sub prime crash; otherwise, process books on corporate finance, marketing, management, negotiation, etc I could probably write a basic textbook myself at this point. I have little background in finance (stocks, bonds, trading), but I'm fine with that, I've read up on it, but it isn't my cup of tea. Obviously I'm confident, it comes with the territory, I'll be self-depreciating where I can, but hate away cause I really can't fake not being confident, not that I do give a fuck as well.
But, as I've mentioned, I was 'trained' to be the ideal corporate executive; work a like mofo, uber alpha male competitive, brutally honest but political where necessary, quick thinking, decisive, completely results oriented and able to make every resource count. My staff honestly called me Rambo, but they did so with sadness because unfortunately they were the team that had to be dropped(forced) in the jungle with me. I did all this, not cause I'm a robotic corporate mofo, but because it was the arch-type of what I thought was my role in business and the reward was financial stability. I'd say, I was everything my uncle hoped I would be. This book made me question all that, that in being the CEO or managing director of a major existing corporation was the end goal, it made me question, did I want freedom or stability?
Of course, any sane person would say, freedom isn't getting more money or position, freedom is actually taking a step back from it all and striking a balance. For me, I thought of it in terms of getting freedom in being more capable, to master both sides and to take on Felix's challenge. I thought, the longer I stay on, the less chance I will go to a start-up. And even when I quit, much to the protest of my wife, my staff, and my friends, I still considered just going into another big industry/company and it wasn't until six month afterwards did I really start on the path to start-up/new company hell.
As Offensive as a book as any If you're looking for a book that is offensive and in your face, about business, this is it. But as a really practical guide, it does miss one vital point, and it is something that I have learned over the last two years. No matter how much experience or knowledge you have in your industry, being an executive and running a new company are two totally different skill sets. One will not help with the other in any meaningful way. Executives turn entrepreneurs will come in with a false sense of confidence and expectations and have them crushed.
The other point is, it doesn't matter how confident you are, how big the market is, how good your product is, the market needs to be growing dramatically. You should never launch your first new company in a market that isn't growing dramatically, because timing means so much. It means if you make mistakes you won't get severely punished for them, or your efforts have a direct effect. I could spend a book explaining how important timing is and I don't mean getting lucky with timing, but understanding how timing plays a role in the company you want to start. I get where Felix is coming from, he knows, fear of the start is the #1 factor why people don't go off and 'get rich', but the amount of will power to over come that fear may just blind you to the other real business fundamental of running a start-up which he doesn't cover here.
But why I like this book is that it is unapologetic. This ain't a book for the faint of heart and it doesn't high behind any 'do no evil' 'connect the world' new age silicon valley nerd technology banners. This is business as honest as it can be, and Felix gets right to the points about how he thinks about money and getting rich and what that means. And it is a good place to start, right from the top.
The Corporate Series
Over the course of this series I will be dealing with everything under the sun, success and management in a big company, killing the ladder, experience and of course the knowhow in how to keep on track. We all get fucked, fuck up and so on, but it's ok if we're going to come out on top on the other hand, getting fucked and not getting anything for it, that sucks - is an understatement- but the first bit of knowhow in business that I can share is: don't chase being rich, chase being business smart and that will be enough. Cause if you chase anything else, ego, excitement and dreams will blind you instead of guide and support you.
On September 20 2012 02:16 Otolia wrote: I love getting to know the enemy.
lol, but honestly this is so true, as well, even I get a lot of guys more hardcore than me trying to scam me and I really know business inside and out. And it's probably the number 1 reason why the finance industry makes so much cash because of the opaqueness of it all. i.e. how much crap they can get away with! ^^ but thanks for the post, appreciated it.
E: Met a couple of Rambo types in my time as a consultant, but most of them were concentrated in PE. Quick question though--why did you make the jump? Was it a good idea you had, was it the availability of funding/partners to help your idea?
Another good read. I always go through them, somewhat realizing that you are dropping some bigass pearls of wisdom with your words, and that your advice is truly invaluable. But I always feel that I haven't truly LEARNED or internalized what you've been saying in these (and to my surprise you used the same word in this article itself haha)...I guess I need to reread them, haha? But seriously, it's obvious that there is just amazing advice here and I'm always afraid I'll forget or not internalize everything. Cheers and thanks
I read that book too, probably two or three times by this point. The first time I read it was about 2 years ago, at first I thought I can get pass all of Felix's challenge questions, but after having some more life experiences I gotta look back and say that I probably can't answer 'yes' to every question on his checklist anymore. But I'm not 100% certain, so now I'm really trying to figure out which path to take. Thank you for bringing his book up though, it really is quite enlightening (and well written).
I love your writing MightyAtom. I'm gonna buy that book, I think it'll help me a lot. I actually printed out your blog about being efficent at work before, really inspirational. Keep up the nice writing, and if I ever visit SK I'd love if you have time for a drink~
One of the things that my Opa told my father, and my father told me was some old jewish words of wisdom, "The christian way to open a business is to open a brand new business in a field that already exists, the jewish way is to copy everything, just make it 10 cents cheaper."
EDIT: Also great post can't wait for more posts mightyatom .
Very interesting post MightyAtom, some people have that one book (or in my case those few books) that alters the trajectory of their professional and personal lives. I liked "How to Get Rich" and Felix is an intriguing character but I didn't find it that practical. I much preferred "The Millionaire Next Door" which was a lot less dramatic and more practical for me. Live below your means, and acquire equity (Through mutual funds, stocks, your own business etc).
I live by that maxim. I pack my own lunch, I negotiate every chance I get (Even my rent), rent a small but cozy apartment, I have a bus pass for commuting, I use every credit card and tax trick that's out there and when I travel I'm frugal as well (Saved thousands on a trip to fiji by doing "global volunteering"). Even my salary is relatively low, but I own the majority of the equity in my company. Anyone can become wealthy (i.e. Healthy net worth, financially independent) using these methods. You don't have to be an entrepreneur. Though everything in his list rings true.
MightyAtom, I look forward to your article on management in a big company. If I may suggest a couple of topics that others might enjoy, how about operational excellence or the art of talent finding? And also project management. I recently got on the "cloud management and collaboration" bandwagon. I don't know what software you use but I use Clarizen and Salesforce predominately.
My biggest question after reading this is, where do I start? By that I mean how did you get to become one of the top executives, did you go to school? If so for what degree? Did you start at the bottom and work your way up or did you have a job waiting for you? I know for a fact I want to go into business, maybe for the wrong reasons but nonetheless there has to be a starting point. A path I need to follow to get to this point, this is the hardest part to understand for me.
On September 20 2012 02:44 Shady Sands wrote: Fascinating stuff Mighty.
E: Met a couple of Rambo types in my time as a consultant, but most of them were concentrated in PE. Quick question though--why did you make the jump? Was it a good idea you had, was it the availability of funding/partners to help your idea?
the jump was always at the back of my mind really, but it wasn't based on any idea or the availability of funding, I took the jump first because I knew if I waited any longer I likely wasn't going to have the courage/balls/insanity to take it later. But my situation was different than most because I did have some savings and my industry reputation and network was strong enough that funding wasn't going to me a major issue for me. Don't get me wrong, funding wasn't easy to sort, but I knew I would get it.
In terms of ideas, I'm not a product guy, so for me it was more of a matter, can I run a company, in this industry, better than others? And the answer was yes, so I wasn't re-inventing the wheel by any stretch of the imagination. ^^
On September 20 2012 08:30 Aerisky wrote: Ouch, Otolia such a harsh rater lol.
Another good read. I always go through them, somewhat realizing that you are dropping some bigass pearls of wisdom with your words, and that your advice is truly invaluable. But I always feel that I haven't truly LEARNED or internalized what you've been saying in these (and to my surprise you used the same word in this article itself haha)...I guess I need to reread them, haha? But seriously, it's obvious that there is just amazing advice here and I'm always afraid I'll forget or not internalize everything. Cheers and thanks
Well I think you have the right understanding, I think internalization comes with time and experience and at those moments when you're actually doing something, and then you have that split moment of choice and then you remember something that you read or learned before and then suddenly it makes sense in that context and bang, by applying it you internalized it. I don't think it business it can come any other way, this is all just mental prep work, but it never sticks until you've made it stick by the decisions and actions you make ^^
On September 20 2012 19:19 JollYRoGeR wrote: I love your writing MightyAtom. I'm gonna buy that book, I think it'll help me a lot. I actually printed out your blog about being efficent at work before, really inspirational. Keep up the nice writing, and if I ever visit SK I'd love if you have time for a drink~
for sure ^^ although my travel schedule is so erratic, I hope we can organize another TL meet up in Seoul and I can or attend, or what would be cool if I attended a meet up in Sweden keke!
On September 21 2012 04:26 Warrior Madness wrote: Very interesting post MightyAtom, some people have that one book (or in my case those few books) that alters the trajectory of their professional and personal lives. I liked "How to Get Rich" and Felix is an intriguing character but I didn't find it that practical. I much preferred "The Millionaire Next Door" which was a lot less dramatic and more practical for me. Live below your means, and acquire equity (Through mutual funds, stocks, your own business etc).
I live by that maxim. I pack my own lunch, I negotiate every chance I get (Even my rent), rent a small but cozy apartment, I have a bus pass for commuting, I use every credit card and tax trick that's out there and when I travel I'm frugal as well (Saved thousands on a trip to fiji by doing "global volunteering"). Even my salary is relatively low, but I own the majority of the equity in my company. Anyone can become wealthy (i.e. Healthy net worth, financially independent) using these methods. You don't have to be an entrepreneur. Though everything in his list rings true.
MightyAtom, I look forward to your article on management in a big company. If I may suggest a couple of topics that others might enjoy, how about operational excellence or the art of talent finding? And also project management. I recently got on the "cloud management and collaboration" bandwagon. I don't know what software you use but I use Clarizen and Salesforce predominately.
Yes, I don't think there is one way to be financially stable or wealthy, for me its more about pressing my limits more than anything else. I'm completely the opposite mentality, if I spend more, I try to make more. So rather than discipline, its more like I'm driven by the challenge, which is a far more risky proposition, that being said, I have a policy of no debt; we pay our credit cards to zero or as close to zero each month and we never buy anything we can't afford to purchase out right. Again, I don't think there is a wrong or right way, but we also need to be true to our own approach and character. That being said, in managing a new company where I'm responsible to the shareholders directly, I have been far more frugal out of necessity.
In terms of your suggestions, I think they are excellent, although I think I'm going to tackle the corporate ladder first. =) And we have our own inhouse programs for CRM and project management, so I'm not familiar with those companies, although they seem to have great clients. =)
On September 21 2012 09:49 Fallians wrote: My biggest question after reading this is, where do I start? By that I mean how did you get to become one of the top executives, did you go to school? If so for what degree? Did you start at the bottom and work your way up or did you have a job waiting for you? I know for a fact I want to go into business, maybe for the wrong reasons but nonetheless there has to be a starting point. A path I need to follow to get to this point, this is the hardest part to understand for me.
If you want to get into the executive path, it depends on your industry, but yes, get a masters in business admin, or international business or masters in law at the very least, so that means working for a few years then applying.
If you want to get into finance, then you need to get an ivy league degree, otherwise, its tough unless you are able to network and get something sorted on your own, otherwise, just get an MBA or business degree at the best school you are able to do it at. Some top firms will even send and sponsor their staff to get their MBA.
Undergraduate business degrees are ok, I didn't have one, but at least they focus you more towards business right of the track, but it won't guarantee you to get on the executive track.
Everyone starts off entry level, and its a matter of learning the industry, working your way up, impressing your manager and putting some wins under your belt that go beyond your schooling, i.e. made 650% return last year on the marketing budget etc.
But even starting as a non-paid intern at the best company you can get into, is great, cause it can lead to a paid internship and so on and so forth.
The number one thing you need is experience, but not just any experience, you need to also acquire knowhow at companies which actually have their 'own culture' of performance.
I'll get into this as my next post, it may not come out for a bit of time, but I hope this is enough to get you started,
visit the usual suspects sites for some broader scope like gs.com and google and see what types of positions are open; don't get depressed if you aren't qualified, hell, I'm probably not qualified for 98% of the jobs up there, but it is just to open your eyes a bit.
On September 21 2012 04:26 Warrior Madness wrote: Very interesting post MightyAtom, some people have that one book (or in my case those few books) that alters the trajectory of their professional and personal lives. I liked "How to Get Rich" and Felix is an intriguing character but I didn't find it that practical. I much preferred "The Millionaire Next Door" which was a lot less dramatic and more practical for me. Live below your means, and acquire equity (Through mutual funds, stocks, your own business etc).
I live by that maxim. I pack my own lunch, I negotiate every chance I get (Even my rent), rent a small but cozy apartment, I have a bus pass for commuting, I use every credit card and tax trick that's out there and when I travel I'm frugal as well (Saved thousands on a trip to fiji by doing "global volunteering"). Even my salary is relatively low, but I own the majority of the equity in my company. Anyone can become wealthy (i.e. Healthy net worth, financially independent) using these methods. You don't have to be an entrepreneur. Though everything in his list rings true.
MightyAtom, I look forward to your article on management in a big company. If I may suggest a couple of topics that others might enjoy, how about operational excellence or the art of talent finding? And also project management. I recently got on the "cloud management and collaboration" bandwagon. I don't know what software you use but I use Clarizen and Salesforce predominately.
and...you should write a knowhow for that book as well ^^ if you have time, I'd appreciate it as well as I could be a bit less reckless as well in general.
On September 21 2012 10:48 MightyAtom wrote: and...you should write a knowhow for that book as well ^^ if you have time, I'd appreciate it as well as I could be a bit less reckless as well in general.
You know what I would love to write a know-how on that one day! (When time is kinder to me) It's one of the books that jolted me to becoming who I am today. I'd also really like to write about the book "The Lean Startup" by Eric Reis. Lean or more accurately agile is a big part of my business, it's in its DNA. Almost everything right down to our marketing and CRM is "agile". Plus I can approach the article from the drop out, underachieving bum angle No ivy in this league.
-Gunbae!
P.S. My first successful home based business (After three failures xD) was a niche review site signed up with Amazon affiliates. It's only really profitable if the item costs over $200 and if the traffic is high and targeted enough. For that you'd need search engine marketing for the keyword; So when a person google's "The Lean Startup" its TL Know How page shows up at the top. I've always wondered why TL went for Google Ads instead of a handful of prominent ads to relevant products like Alienware laptops. That would make a small fortune cause TL has a sterling reputation they can leverage for more exclusive partnerships and a large, marketable audience . AdSense REALLY sucks for generating online revenue but partnership programs (Like Amazon affiliates) kick ass.
On September 20 2012 02:16 Otolia wrote: I love getting to know the enemy.
lol, but honestly this is so true, as well, even I get a lot of guys more hardcore than me trying to scam me and I really know business inside and out. And it's probably the number 1 reason why the finance industry makes so much cash because of the opaqueness of it all. i.e. how much crap they can get away with! ^^ but thanks for the post, appreciated it.
i feel like i have such a different perspective of the startup world, since i entered it at a very young age from the developer->CTO->CIO side and not as an older businessman. what role exactly do you play at your startup(s)? I dont see what it would be other than maybe Strategy/CSO? or VP of Business Development?
when i read your articles, i feel like i see a different world than you do.
this one had a lot of basic general info on the mindset you need to have to be rich, though.
from my experience being part of 4 startups at the same time, which you claim to do, is counter-productive, horribly inefficient, and damn near impossible to actually commit to. unless they are all very well funded and you dont have to work as hard to out-execute. i've mostly bootstrapped so i always try to focus really hard on one thing, and outexecute my enemy even if he has 50m in VC funding and i have $0 (true story btw, and we ended up with not only a better product, but positioned ourselves to take the market in a superior manner )
On September 20 2012 02:16 Otolia wrote: I love getting to know the enemy.
lol, but honestly this is so true, as well, even I get a lot of guys more hardcore than me trying to scam me and I really know business inside and out. And it's probably the number 1 reason why the finance industry makes so much cash because of the opaqueness of it all. i.e. how much crap they can get away with! ^^ but thanks for the post, appreciated it.
i feel like i have such a different perspective of the startup world, since i entered it at a very young age from the developer->CTO->CIO side and not as an older businessman. what role exactly do you play at your startup(s)? I dont see what it would be other than maybe Strategy/CSO? or VP of Business Development?
when i read your articles, i feel like i see a different world than you do.
this one had a lot of basic general info on the mindset you need to have to be rich, though.
from my experience being part of 4 startups at the same time, which you claim to do, is counter-productive, horribly inefficient, and damn near impossible to actually commit to. unless they are all very well funded and you dont have to work as hard to out-execute. i've mostly bootstrapped so i always try to focus really hard on one thing, and outexecute my enemy even if he has 50m in VC funding and i have $0 (true story btw, and we ended up with not only a better product, but positioned ourselves to take the market in a superior manner )
Its definitely a very very different perspective from coming in as a product/development side and an executive side. Of course being part of 4 start-ups on the execution side would be impossible, but my role varies considerably as well as where each of the start-ups are at. One of them I am the CEO of, but it is fully staffed, funded etc, going into its 3rd year, another one I'm just on as a general adviser, and the other two I handle their business agreements and negotiations on a political or strategic level. The level of commitment there is one week travel a month. But it comes with the role that I play in that I'm providing the knowhow on the business process side rather than actually creating any new products. So again, I wouldn't really classify what I do as 'start-up's', but rather new companies.
This particular series though will be focused on the corporate executive path, which I'm far more experienced in, as my professional background is that of a business negotiator and management consultant. But this particular article was about the general mindset of business, if you're going to play at a certain level, but as I also mention, 'nerds rule the world, finally' as well. ^^
But good on you for your own projects, unfortunately, bootstrapping has never been an option for me because I cannot code or develop my own product, I need to hire people or get turnkey solutions and then just concentrate on out competing the market on a strategic marketing level. Until recently this has been a very limiting condition for most of my businesses that I work with. I reckon this is why most senior executives fail at start-ups because we are unable to keep costs low on the development side and we lack innovation simply because we cannot get value from our own labour contribution on the product side, that being said, we play to our strengths and one of them is the ability to not have to be bootstrapped when we begin- but that cash burns through extremely quickly as it's always a 'spend down' rather than something to help extend the development process (i.e. you have the development team and the money gives you extra time to develop rather than you use the buy to buy a development team and you don't get any extra value, input=output).
On September 20 2012 19:19 JollYRoGeR wrote: I love your writing MightyAtom. I'm gonna buy that book, I think it'll help me a lot. I actually printed out your blog about being efficent at work before, really inspirational. Keep up the nice writing, and if I ever visit SK I'd love if you have time for a drink~
for sure ^^ although my travel schedule is so erratic, I hope we can organize another TL meet up in Seoul and I can or attend, or what would be cool if I attended a meet up in Sweden keke!
For sure! I'm in Sweden a lot. Lot's of Dreamhacks and stuff aswell, I attended to the WCS Europe finals and was amazed at the production quality and the crowd. They also had a bar-area that I enjoyed. Good stuff!
Business is not really my thing at all - nor do I think I am built for it, but I really, really enjoyed reading your blog nonetheless, MightyAtom. If at some point, you do want to unplug, you could definitively be a writer. I wish you the best with your goals in life, and your great adventure at start-up.
Always go by your gut feeling/intuition, and you will never do wrong(even if you fail in achieving what you planned). And never be driven by greed, whether it being money or some other force, as there is a chance you will lose yourself in the process, and no one is greedy by nature - at least that is what I tell myself, and furthermore makes you take - perhaps - unnecessary risks.
But whom am I to give you advice? I am merely an observer of life standing on the sideline, while it happens.
Your blogs are always damn good. Pity I came in after you deleted the earlier ones, but I can still tell that they were good from the comments.
One thing I find weird is that you always stress that your Korean is not very good, but that never seemed to hinder you when you were working in Korea. Can you tell me how you sorta worked around it?
On September 20 2012 01:35 MightyAtom wrote: This book, 'How to Get Rich' by Felix Dennis (400M-900M net worth- he doesn't exactly know)
Oh my god...
What qualifies as rich for you?
it has changed a lot over the years, but for me, its about 200M USD in cash. The reason why its 200M is not because I'm thinking in terms of buying houses or cars, but in terms of what businesses can you buy or take over or start. So you figure that even if you have a great business now, later own, things change with the market and with 200M, you pretty much could buy your way in to most growing industries if you wanted to.
But if you're thinking in terms of just spending on consumer goods, I think 30k USD a month is more than enough to be satisfied as 'materialistically rich' in terms of what surrounds you. But its a key difference between most people who look to get cash as a means to buy/consume products and business people who look to use the money to invest in things that make them more money.
On September 27 2012 07:20 Kalingingsong wrote: when is part 2 coming? I can't wait any longer lol.
Sorry! I'm just traveling and still trying to close a major deal right now, so it's not likely to come out for another 2-3 weeks! But I have the topic already sorted, just got to write it out and get 2 hours free to do so. ^^
On September 29 2012 17:00 targ wrote: Your blogs are always damn good. Pity I came in after you deleted the earlier ones, but I can still tell that they were good from the comments.
One thing I find weird is that you always stress that your Korean is not very good, but that never seemed to hinder you when you were working in Korea. Can you tell me how you sorta worked around it?
I cheated, I have a very good family background, so that precedes me most of the time in formal business circles. Thing is, just cause you can speak Korean or are native Korean, doesn't still qualify you to know high level business culture or protocol, so that is something which you gain either through family exposure or being in a good company. So, even a mid-level consultant probably knows more about business culture protocol than a CEO of a small company of 15-20 people.
But not having good Korean was very limiting in that my role was always specialized for business negotiations or strategy and basic things like doing audits or interviews with general staff wasn't something I could (or be asked to do). That being said, I can communicate at a high business level, simply because in Korea, when you get to that level, most of the CEOs are US educated or extremely educated, so the business minds are the same. Also, I would have staff that did do translation work etc.
I think things have changed nowadays where the need for experienced international business people is less and less because there are so many Korean's from great backgrounds who have been educated abroad etc. But I think for business, more than most other fields, its all about this line of 'results'- meaning that if you need to explain in more than 2 sentences how to make something work in business, you're fucked anyway, and it's pretty clear if you're on the right track. But things like legal documentation, those things would be reviewed by lawyers, translations double/tripled checked as there can't be any ambiguity there. A field like domestic marketing promotions in Korea, I probably am the opposite of qualified. ^^
On October 01 2012 14:42 MightyAtom wrote:But its a key difference between most people who look to get cash as a means to buy/consume products and business people who look to use the money to invest in things that make them more money.
Hmm
Can you offer any insight into the psychology of the latter?
Great post! A really good read. I read Felix Dennis' book and finished it about 4 months ago.. I'm in my early 20s, and this book has really inspired me to start my own business and jump in the race of getting rich. But after reading your post I'm now having doubts, because I never start my own business, nor have I any experience in being a company exec or a manager.. The only work experience I have is as an entry level consultant, and even that was part-time.
As someone who's experienced, can you give me some advices as to how do you overcome that fear of starting.. fear of failure, fear of losing a lot of money?
I'm on a similar path, and have the same issues/concerns.
I couldn't really tell definitively from your OP or following posts, so let me ask you: What was the number one thing that made you want to be rid of the corporate world? Was it the prospect of taking a prospect from the ground-up (i.e. self-achievement)? Was it because you were afraid that the top of the corporate ladder wasn't that stable? Were you just tired of all the bs that goes long with it?
On October 01 2012 14:42 MightyAtom wrote:But its a key difference between most people who look to get cash as a means to buy/consume products and business people who look to use the money to invest in things that make them more money.
Hmm
Can you offer any insight into the psychology of the latter?
On October 01 2012 14:42 MightyAtom wrote:But its a key difference between most people who look to get cash as a means to buy/consume products and business people who look to use the money to invest in things that make them more money.
Hmm
Can you offer any insight into the psychology of the latter?
Sorry Guys, I'm still in the middle of closing things out,
the majority of the population hasn't been educated or exposed to money, other than it's primary usage of buying things as a consumer.
Think about it for a second, the main reason why you earn money is to spend it on some consumer good or for perhaps your living expenses or tuition.
So unless you have some unique understanding of what money is, like if you are a natural born entrepreneur (I'm not), you're always thinking of money in terms of it's ability to buy something.
This is normal because the majority of people usually are always a bit short on the money side, there are always desirable things that people want to buy that are a bit out of their reach and it is the market that does that- meaning if you want to buy a watch, -there is the function of the watch to just tell time accurately or there is the watch that is fashionable or the watch that is a status symbol or the watch that is a collectors item. Each one with a different social function and costs, but they all tell time equally well.
On the flip side, there are those who (i) have money, or (ii) those who understand that money is simply a byproduct of businesses or investments that generate money. For those who have enough money, buying materialistic things isn't the only thing on the shopping list, rather buying stocks or understanding how their money can make more interest or how to protect their money from taxation, becomes a much larger concern. When you have 50,000,000 in the bank, even at 5% interest that generates 2.5M a year! And while that is an extremely simple example (and if you live off that interest you'll get taxed for it - depending on what country you live in), it's not in your best interest to ever spend that 50m, unless it is spending it to make more money.
For those who do a lot of business and do various investments, money is the score board of making successful businesses. While the name of the game is making more money, and it is hard to get away from a very simplistic view of it, let me put into a chess analogy.
Lets say you have an empty chess board that is not just 1v1, but a free for all verses 10 other players, but everyone starts off with no chess pieces. But the more cash you have, the more pieces you can buy and it is up to you to choose what kinds of pieces you want, such as pawns or rooks or even queens. That being said, you still need skill to play the game as not everyone can buy all queens and also move the pieces around, but at a high level of business, it is like that when you're looking at either developing your business, managing a number of businesses, or doing investment and picking and choosing companies to invest in that will minimize your risk and maximize your reward potential.
Now as a management guy, and not a financial investment guy, I don't think about hostile takeovers/leverage buy-outs or what is going on with my stock portfolio, but I do look at how much staff I can bring in, at what level, to compete in some markets where my company can operate in.
So at the end of the day, I'm both a consumer and capitalist in that, I make money and spend it on things of necessity and such, but that is just the salary I make, otherwise, there is the money that the company has, and I choose to budget it where I can, but if the company does well, I have to also think about where can I invest the excess funds- simply because - even if you have cash, it needs time to have an effect, whether it is money from interest or money that eventually comes out from starting a new company.
On October 03 2012 11:16 vpatrickd wrote: Hi MightyAtom,
Great post! A really good read. I read Felix Dennis' book and finished it about 4 months ago.. I'm in my early 20s, and this book has really inspired me to start my own business and jump in the race of getting rich. But after reading your post I'm now having doubts, because I never start my own business, nor have I any experience in being a company exec or a manager.. The only work experience I have is as an entry level consultant, and even that was part-time.
As someone who's experienced, can you give me some advices as to how do you overcome that fear of starting.. fear of failure, fear of losing a lot of money?
Looking forward to your next post
The only thing I can say, is that I didn't want to regret not trying, but I'm not someone who was a natural entrepreneur. At the time I started I was already a senior executive of a major multi-national in my industry, and really by that time, it was probably too late to get started on it because it has been extremely extremely brutally tough. If I could do it all over again, of course I would, but it's not one of those things for me that I would be looking forward to- and I probably won't ever do this again, I promised my wife one shot at it and that's pretty much it.
I'd say, the main thing is: are you product guy- can you make your own product, or can you really see how the product works with the market and what can be hot. If you can't then being an entreprenuer is very difficult as you have to hire others to work with you and your burn rate is so much higher. Having more experience helps a lot, but the time you spend to get that experience is not always 100% transferable. Much of the knowledge I have at the executive level has no application to the first 2 years of the new company I began, now after 2 year that past knowledge has started to give a lot of benefits, but not for the first 2 years where it was extremely difficult.
But the thing is, if you fear, like really fear, then it may not be for you,- being afraid in seeking the challenge is one thing, but to truly have fear, this is not the path for you and really success has so many paths. My own dream was to be an international rugby player, and if I had accomplished that, I do think I would have been fulfilled in my own way.
On October 09 2012 02:50 jacosajh wrote: Thanks for doing this.
I'm on a similar path, and have the same issues/concerns.
I couldn't really tell definitively from your OP or following posts, so let me ask you: What was the number one thing that made you want to be rid of the corporate world? Was it the prospect of taking a prospect from the ground-up (i.e. self-achievement)? Was it because you were afraid that the top of the corporate ladder wasn't that stable? Were you just tired of all the bs that goes long with it?
I'd guess it was the first point, I wanted to prove to myself that I was the best in the industry and the best at what I do and I felt on the corporate level that I had accomplished that (as arrogantly as that sounds, but again, we are talking alpha males here as the norm). I left that it was only by running my own company from the ground up, I wanted to know what it took and from all accounts, it wasn't likely that I would succeed and I'm still at that point where I can't say I have succeeded yet.
But being at the top of the corporate ladder, if your company is the market leader, is a stable as it gets and once you get to the top, you're the one dictating the bs for the most part. But for me, I have pride in what I do, that if it matters to me, I want to be the best in whatever I do, and I am willing to compete with the world to do it. I think the most glorious thing would be if I am able to create a company that eventually takes the market leader position from my old company, a nearly impossible task, but I think that would definitely put me on top for all time in my industry like Lee Iacocca.
On October 04 2012 17:30 NerdFace wrote: I have to get smarter to understand this fully :D
the smarter you get, the less you'll understand ^^, business is all about experience, the more experience you get, you'll see how simple is the crap I wrote keke
On September 21 2012 04:26 Warrior Madness wrote: Very interesting post MightyAtom, some people have that one book (or in my case those few books) that alters the trajectory of their professional and personal lives. I liked "How to Get Rich" and Felix is an intriguing character but I didn't find it that practical. I much preferred "The Millionaire Next Door" which was a lot less dramatic and more practical for me. Live below your means, and acquire equity (Through mutual funds, stocks, your own business etc).
I live by that maxim. I pack my own lunch, I negotiate every chance I get (Even my rent), rent a small but cozy apartment, I have a bus pass for commuting, I use every credit card and tax trick that's out there and when I travel I'm frugal as well (Saved thousands on a trip to fiji by doing "global volunteering"). Even my salary is relatively low, but I own the majority of the equity in my company. Anyone can become wealthy (i.e. Healthy net worth, financially independent) using these methods. You don't have to be an entrepreneur. Though everything in his list rings true.
MightyAtom, I look forward to your article on management in a big company. If I may suggest a couple of topics that others might enjoy, how about operational excellence or the art of talent finding? And also project management. I recently got on the "cloud management and collaboration" bandwagon. I don't know what software you use but I use Clarizen and Salesforce predominately.
Thanks for pointing out The Millionaire Next Door book. Reading through it now and while I was halfway a long the line of thought presented I am now thoroughly set on going all the way.
On November 07 2012 16:50 Elitios wrote: I don't really see how this is a knowhow, isn't more like a diary? Interesting read anyway even if the mentality is totally foreign to me.
knowhow is that operational understanding gained via experiencing in doing something, so it is very much based on experience and that context. It is a matter of coming to same situation and instead of taking 5 steps to resolve it, hopefully with the insight here it only takes you 4 or 3 steps if that makes any sense. ^^
On November 20 2012 10:28 Kyokai wrote: Thank you very much MA! Great post as usual. Any chance you could elaborate more about your "Rambo" bit or being "molded" into a business exec?
Well, for the Rambo bit, I think it comes from two very hardcore corporate backgrounds: management consultant and being part of corporate Korea.
I wouldn't think that I'm anything special within the professional corporate culture in Korea- even back in the 90's being a good corporate guy was basically 'how long you could sit your ass at the desk' and how many hours you could log in. But of course, when the crap hit the fan or there was a deadline, the impossible would get done (usually make the foreigners working in Korea at that time think that Koreans were all totally irrational nut jobs- seemingly just going through the motions on one side, then declaring to take over the world the next and actually succeeding in totally out of reach projects that get launched in a month when it normally takes 5 months of pre work..).
But with all the foreign educated CEO nowadays, it is less like that and it is about getting results. Thing is, corporate Korea is still about biting off more than you can choose and really- failure isn't an option.
In terms of being a management consultant, there are lots of hacks out there and just cause you are management consultant doesn't mean you're the best at business, but for sure- anyone who was a management consultant and a tier 1 or Big 4 accountancy firm at least has one thing going for them - super quick thinkers, super quick at understanding and can turn out work like a motherfucker. If someone has a background as a management consultant, no doubt they will be usually the first to the punch line.
Put that together and then put me in a UK multinational and basically I killed it and made regional director from senior manager in a year and a bit and took out 2 senior line managers above me. I never waited for further resources or wasn't willing to put my job on the line for every project I took on. If we were short cash, I'd pull out 20k out of my own pocket and get it reimbursed later (my wife would always say, 'are you paying to work for this company?' cause the company would always be owning me massive expenses each month), but I just did whatever I needed to do.
The biggest thing was waiting for 'headcount' meaning when you need more staff, you need to request it via HR and its a big deal, but hell, fuck it - I'd put the request it and not expect it to come through for at least 8 months and just do the work anyway.
The other biggest thing was that I trained my own staff, if they didn't have the skill, then I'd just train em until they could do what they needed to do. The biggest thing about the inexperienced is that they don't understand what is a 'professional standard', meaning that what they think is their best, should be good enough- when it's far from enough. An example is, most of the inexperienced think, 'well it is good enough for me...' well FUCK OFF, are you making 200k a year? If our consumer is in that income range, you think they'd be happy driving your shit car too? - So understanding that and setting the standards was a major part of training.
But the funny thing is, if this is really all my staff knows as 'how corporate life should be' then the just assume that people work like this at that level. Lots of swearing, lots of threatening to fire them, but also, lots of gifts, complements and bonuses when they did well.
It does seem like a lifetime ago, most of my juniors now are nearing the director level so its good to see that they have kept the edge, if I do see them, they always tell me that they tell stories their juniors when they complaint or do shit work and say, 'if you knew who trained us before, he'd have ripped you a new asshole by now etc..' so I'm pretty flattered about that and yeah, they all appreciated that time as I did as well to have a team that was able and willing (sometimes forced) to go to hell and back. And hell and back was working 16 hour days for 3 months straight, or working non-stop with 4 hour naps for 2 weeks straight to hit a dead line etc.
But when you see your staff more than your family, I mean, you can't help but be close; but I'd say, you do need to be sensitive to what kind of staff you have- if you wanna go rambo style, you have to walk the walk, but also you need staff who are ambitious- who will look at you and think they are learning something in this hell, or else you will break them or simply not retain them either. ^^
Woah. I was definitely interested in working for a big 4 Accounting firm one day. Your post now makes me want it as bad as I need to breathe o.o I'd still want to drop into the jungle with you even if there was a fuckload of cyborg t-rexes with death lasers >