Monday, March 8, 2010

Chance favors the prepared mind.

Have you ever heard the phrase, "Hurry up and wait!"? It is a funny little saying, but in the world of business, it actually has weight. This is also where a great many people get defeated when they enter the business world. People, in general, have a bad habit of waiting for the right opportunity and then act once it arrives. This is much like trying to get onto a moving train from a stand still.

Here is what seems to typically happen to people. They wait for opportunity to knock. When it does, they attempt to ceize the moment and grab onto the opportunity with all their might. However, this fails many times because the people grabbing onto the opportunity were not prepared for that opportunity. Now, here is what makes it worse. If those people don't realize that it is a lack of preparedness, they tend to think that the opportunity really wasn't for them. Then it's not long before every opportunity loses it's luster and appeal and the attempts are soon stopped.

NOTE: These are my opinions, by the way, based on things I have studied and observed.

The good news is, it is easy not to fall into this trap. If you hurry up and wait... in other words.... if you prepare yourself for the opportunity that is to come, then when it arrives, your grip on the opportunity will be much stronger and your chances at success will be much higher.

Of course, this is easier said than done, but not by too much.... not if you really want to be successful. It takes a bit of determination and in some cases a pretty good amount of patience. It can be a bit disconerting when you work hard to be ready, but the opportunity doesn't seem to come your way. You might be wondering, how does one survive the delay of an opportunity that may never come?

One way is to diversify your interests. I say this with a big "IF POSSIBLE" in mind. Some people are just one tracked and that is it. For those people, I'm not sure what to offer. This could explain why you rarely run into a successful one tracked mind person; or so it seems. At any rate, by diversifying your interests, you position yourself to take advantage of multiple opportunities. You, of course, have to take into account how much effort you have to expend and how diversely that effort is being spread. If you spread too thin, you may not be able to catch any of the opportunities that come your way. I think this is a balance that is learned mostly through trial and error. As you grow as a person, you may find that you can muster up more effort for more things or more focus on a few things. I tend to think that this is one of those cases where we are all like snowflakes and no two people will handle things quite the same way. If you keep an eye on successful people, you will notice some resounding traits. You will find the same things when studying the writings of successful people and if at all possible, get to know some successful people personally. Remember, they put their pants on the same way you do. They may be really expensive pants, but it is still one leg at a time.

Another way to survive a long awaited opportunity is to sharpen your preparation of that opportunity. The best way to do this is to blend it into your life in some significant way. For example, if you are waiting for an opportunity that involves a main skill or skills, get a job or get into a career that will require you to make use and build up those skills. In this way, you are falling back on working for the man while you wait for your chance to be the man. This may work for some and not for others and also may be based on the opportunity itself. There are many worthwhile opportunities that require very little skill.

I'm sorry to speak in such vague terms, but I can feel this blog entry growing as I type...

Yet, another way is to turn your waiting time into an opportunity to enjoy the things in life that can't easily be enjoyed while you are clammering towards your prepared state or while in the throws of the opportunity itself. For every big opportunity, there seems to be a period where one almost has to lose one's self for a while until the rough and rocky start of the road to success slowly smooths out. This could be as simple as taking time to soak up your family, do something fun, or anything that brings joy and happiness and peace to your life. There is no sense in being miserable while you wait for your opportunity.

Always, the key is to be ready for when your chance comes along, whatever that chance may be and remember:

"Chance favors the prepared mind." ~ Louis Pasteur ~

Monday, February 22, 2010

Business #3½, brokerage

So, as my car business was coming to a slow and painful death, I was attempting to get into the world of brokering. It's a fairly simple idea. You basically connect two ends together. One end is somone who needs something and the other end is someone who has something that the other end needs.

I knew there was a lot of potential with brokering because I had seen it work before my very eyes. If you pay attention, you can see this pattern all over the place in business. The best example to wrap your head around is the idea of a mortgage broker. If Joe Schmo wants to buy a home, but doesn't want to apply to bank after bank and finance company after finance company, he would go to a mortgage broker. So we have Joe Schmo who needs something; financing for his new home. Then Mr. Broker, who is typically already in relations with financial entities who have lots of money to loan out, will contact his people who then bid for the chance to loan their money out. These guys are the end that has something that the other end wants.

The broker sits in the middle and scrapes his piece of the money out of the deal and then he is out of the picture. After the deal is done, Joe owes the financial entity... not the broker.

As you may know, mortgage is not the only thing that is brokered. Just about anything can be brokered. Just fit the pieces of the puzzle together and the broker gets their fee for hooking the deal ends together.

Simple right?

No, not really. It does take a bit of a skill with people and a will to dig for the people who need something and the ends that have something. For some this is a breeze. The money making potential is very much worth the hard work though. Especially if you already have or are willing to attain the skills needed to pull it off.

I love brokerage. My first jump into it was very unsuccessful. Mostly because I went at it a little too broadly. I was looking to broker any and everything. The bad thing was though, it meant I had no real focus and therefore no clear path forward. So, while I was very willing and already had some skill, my hazy efforts were fruitless. I still do brokering today, but I was out of the game for quite a while. I deal in two main types of brokering. I broker real estate notes and factoring of accounts receivables. Real estate notes are basically an agreement that one person will pay a certain amount of money regularly over a period of time. Sometimes the people holding the notes don't mind the small chunks of money rolling in a regular intervals. Sometimes, though, the person who holds the note needs the money sooner rather than later. That is where a notes broker steps in. The notes broker can find someone who is willing to pay for the note at a discount. In this way, the original note holder gets most of the money and he is free to use that money for what ever he needs or wants. The note buyer will benefit by earning more money than was spent on the note, but over a period of time.

The factoring brokering is basically the same. A company may have invoices that they are owed on. These are also known as accounts receivables. Many times one company will buy from another company, but they won't have to pay until 30 to 120 days on that purchase. Imagine a nursing home. Grandpa Skippy has medicaid which pays for his needs at the nursing home. However, medicaid doesn't pay right when the bill is created. They don't have to pay out for sometimes several months. This is all good and well unless the facility needs to make repairs or pay their staff or expand. One thing they can do is sell their accounts receivables at a discount to a factor (a person or company with money to spend on such items). The factoring broker can put this deal together by finding one or more willing entities to purchase the discounted invoices. For this, the broker gets a cut and is then out of the picture.

In both cases, it is possible to go straight to the source of the money, but this in itself is time consuming and can actually end up costing money. It is much easier to go through a broker who will often times have access to mass amounts of money and generally can find more than one entity to bid for the purchase. This means the deal gets better for the seller of the invoices.

I have worked in the customer service field for quite some time and in doing so have developed communication skills and a vast knowledge of business to business relations. This is a good fit for this type of business.

If you are looking to get into something and would like to be able to make big bucks for relatively simple work, I suggest brokering of some kind. Especially large ticket items such as real estate or accounts receivables. It is very common to make thousands per deal. Sometimes these deals are on-going.

As always, research what you are getting into and pay as much attention to the little details that you can. It is the details that will both save and grave you.

Until next time.... have a good one.

Thursday, February 4, 2010

The Field of Diamonds by Vernon Howard

There is a story you must read. It contains a very valuable lesson which I would like to speak to in my upcoming post.

The Field of Diamonds by Vernon Howard

Strive for failure! Even though it doesn't taste so great.

By this point, and even before it, many people would have thrown in the towel. I am here to tell you, the thought of giving up on being successful and financially independant seems mighty tempting especially after not really being successful multiple times. It's hard to overcome all the people who have watched you try and fail time after time. That alone makes one want to crawl into a hole and hide. On top of that, looking back at all the ways you went wrong and all the mistakes that were made along the way is quite deflating. Then, when you try to look forward and head for the horizon where success is supposed to be waiting for you with open arms, it very quickly just seems like a waste of time, money, and energy. As if all that wasn't enough, if you are like me, I already had a career that treated me very well in many ways. The "golden hand-cuffs", I believe they call it.

What does it take to overcome all of that and take the next step towards the alleged riches of success?

You have to ask yourself if it is worth all of the trouble and all of the embarrassment and all of the mistakes to come out on top. Is it worth it to try and fail over and over just for the chance that you could join the list of people who have tasted and continue to taste the good life?

What really is there to lose? You can only lose what you put at risk. There is no need to risk it all. Some people have done it and made it while others have put themselves out on the street.

For me, and I dare to think that for many others, I think there is nothing really to lose in trying until you make it or you die trying. I could see that, if I didn't try, I would work at my job making my wage and follow the path of the many who do the same and end up retired and broke. If I tried and never hit success, I would be no worse off as I would still work my job and make my wage and retire broke.

Some might say, that you should enjoy life as much as you can and not waste time shooting for stars. I think that success is not a star at all and is very achievable. I made up my mind a long time ago, that I would rather try for the chance at success rather than fritter away my opportunity to better myself.

What does it take? You must realize you are your own country and master of your own world. If you have a vision of where you want to be in the future and you believe in it, the worry about what others think begins to fade. What does it really matter what others might think if there is something out there that is truly important to you?

The key is that you must become independant before you can ever become financially independant. Hanging on the words and the will of others will never get you there. Sure, there are those that are handed success on a silver platter, but that is not the same success we are talking about. Unless someone is going to drop a bundle of money in your lap and invest it wisely for you, I'm afraid you are going to have to do it yourself.

What else does it take? It takes persistance. Ride ever towards your goals and you will find the means to reach them. Persistence is priceless.

Why should you strive for failure? It sounds a little insane when you first hear it and still seems wrong at first. Esepcially given that, for most of us, we are punished for failing and pushed for success right out of the gate. You need to realize, that human beings only succeed through failing. You didn't walk right after being born and it took many stumbles and many falls before you got it right. This is a metaphor for each person's entire life. Failure is quite natural and quite necessary. When you realize this, you will see that failure is actually a good thing. It is through failure that I have found my way closer to success. It is failure that lets you know what not to do.

Take two people and a maze. Send one person through. That person may make it through or they may not, but either way, I guarantee you that the person that went through that one time knows a turn or two that should not be taken. That person is now more successful than the other person who has not gone through the maze.

If you know what not to do, you are far more prepared for what the right thing to do is. There is a fairly famous quote by Thomas Watson, Sr. "If you want to increase your rate of success, double your rate of failure".

Still doesn't seem right does it. If you think not, I urge you to think on it longer, because it's absolutely true. If you continue to be a seeker of success, you will hear and read that over and over as you make your way.

Ultimately, don't be afraid of failure. So many are paralyzed by the mere thought that they might fail and they take the easy path towards broke-ville.

I don't know about you, but I'm sick of being broke. I have been broke my whole life. I am tired of struggling and watching my friends and family struggle.

I decided long ago to strive for failure and be the master of my world and push towards success. I have been going ever since and continue to push forward now. Success is already in reach I can tell you now that the foul taste of failure is very much worth the taste of success.

More to come...

Thursday, January 28, 2010

My third adventure in business, CARS CARS CARS

After my computer business, I kept thinking about what I had learned in my past experiences and searched for something new to try. Still keeping in mind that profits are better than wages and working for yourself has a higher potential that working for someone else. I can't remember exactly how it happened, but at some point, it occurred to me that the margin between the cost of a vehicle to a car dealer and the price it is actually sold for can be significant. This started me on my path to researching what it would take to be a car dealer.

I want to point out a prevailing theme that seems to exist for all aspects of life and especially business. It is something that has become a philosophy for me over time. Always follow the "why" and the "how". This will come up again, I am sure, in future blog entries, but basicly, it stems from a familiar phrase you may have heard about from Einstein. "Always as why". Many times, a person will give up and their brain will shut off because that person has stopped asking why and stopped trying to figure out how. This could be anything in life, but lets stay on the topic of business. If you think to yourself that you want to be successful in business, but you hit a wall along your way. The person that doesn't ask "why" or "how" begins to believe that it is just not possible. From that point, the brain stops and never tries to overcome that obstacle. However, for the person that does ask "why" and "how", they will think about why the obstacle is there and how it can be overcome. I have found this to work every single time without fail. When I hit a wall. I figure out how to get over that wall. If something keeps me from getting over that wall, I then figure out what it takes to overcome that as well. This process repeats until the ultimate solution is found. I don't think I have ever hit a situation that I could not go over, around, under, or through. There always seems to be a way, if you let your mind think and not shut off.

So, back to the car dealer story. I did my research and discovered that there were a specific set of rules that had to be adhered to in order to be come a legal car dealer. It was a bit of a tiring process, but I got all the ducks lined up and met all the requirements and became a car dealer. I was very excited about this opportunity. It was great while it lasted. I went to some car auctions, which was an adventure in itself.

I am talking real auctions where the auctioneers are making the classic auctioneer noises with their mouths that almost seems like a different language. When I first heard it, I couldn't even understand what they were saying or where the bid was at. Something magical happens after you listen for a short bit though. The jibberish fades away and you suddenly can hear the bids. These guys are real sharp too. You have to be very careful when at a serious auction. Quite literally, the blink of your eye or any small gesture can be considered the acknowledgement of a bid. I do recommend going to one though if you ever have the chance. It is a very exciting experience.

Eventually, I saved up enough money to purchase a car. I was once again working with a shoe-string budget, so everything I did, I had to save up for. fortunately, as a car dealer, you can get cars cheap. So, I bought a car and didn't have it too long before I found someone who wanted it. It was a sister of a friend who bought the car from me. Now, the plan I had was to take my earnings and invest in another car or two if I could manage it. I made a good profit from my first sale and was well set to keep the ball rolling.

Here is where the hard lesson learned comes in. I made the mistake of letting a close friend of mine make the final transaction of the car and money. My friend was supposed to take the car to the purchaser and bring the money back to me. We had handled the paperwork before hand since the person buying the car was in the process of moving and we could not synchronize our schedules. The car and money changed hands, but on the way back to me, my friend ran into a situation that caused him a personal financial problem. With "my company's" money in hand, he made the decision to borrow some of the money with the intention of paying me back. I was a bit upset at this since his situation cost my company more than half the money made from the sale of the car. Not only was it wrong, but now I was actually a step back and had to save up a little more money just to get one car. I only ever got back a small portion of the total amount due back to me. It was bad timing for me that this happened. I don't mind helping my friends, but in this particular instance, it hit me at just the right time where I ended up closing down my car dealer business. Timing seems to matter whether it is good or bad timing. I did end up purchasing another car before the doors to my business closed, however; it was too late and I could not stay above water. I did take away some good things though. I got a good view about how business works within regulations of the state. Nothing too significant, but it was more notches on my business belt. I was certainly not going to let this defeat stand in my way. With my mind, heart, and soul still vigilant, I stepped forward to find what I would do next.

Until next time... keep your mind alive.

Friday, January 8, 2010

My second business adventure, custom computers.

After my two partners and I put to rest the T-shirt business I spoke about in an earlier post, I was able to add to what I had already learned. My mental gears never stopped spinning. In fact, they were spinning even more because I could see the potential. I could see how it could have been done better and had learned from mistakes that had been made.

I have noticed over time that a couple of key things happen in a person's growth process. One will learn from their mistakes and also self evaluate to determine what things need to stay the same and what things need to change. In my case, I had added to my bag of business knowledge and also realized that the T-shirt business wasn't quite right for me. It was obvious that there were very successful people and companies making great money in the T-shirt business. For me, it just wasn't quite my cup of tea. It was exciting to go through it and learn from it, but I would not have been happy trying to make a successful business out of T-shirts.

One thing to keep in mind, regardless of working for the man or if you are the man, try to be sure that what you are doing is fullfilling. If you are not enjoying what you are doing, it will generally not be worth the trouble in the end. You could be making tons of money, but if it is from doing something you hate, eventually the money become less important.

So, with my bigger bag of tricks and my sights set on new horizons, I found myself starting a computer business with a friend and my mother again. At the time, my friend and I were working in the same software company. In our tinkering and exposure to computers, we realized that we could put these things together with ease and had a pretty good understanding of how the components worked together. Starting a business building custom computers seemed like a good opportunity. I love computers. So, for me, this seemed like a really good fit. This was in the late 90's if I remember correctly. This was a time when there were not a lot of people with computers skills. The internet was really taking off, but people were still fairly new to using them much less putting them together. This meant that we possessed a key component to success. We could do something that only a small number of people could do.

This business worked pretty well for a while. Once again, it was a situation where we had to work with a very small budget and we had limited time to work on the hardware. It worked though. It really worked. We spread the word about what we could do and we started getting orders from friends and associates at first for full custom builds to minor fixes and maintenance. Our profits weren't very big, but we did actually make profit. Now some might see small profit as no big deal. In actuality, any profit is pretty amazing considering most businesses operate at a loss for a year or more before they start to show profit and those businesses are considered successful. So, eventhough it was small scale, we had done some things right. I was personally proud of this because it was a sign of moving in the right direction. I had taken the things I had learned and got to taste success because of it.

Despite our small success, we still had to eventually close shop. The interenet really started to take of in terms of business. A number of companies popped up that did the same thing that we did, only they were able to do it on a larger scale. We had a chance to talk to some of these companies and discovered that they really only made pennies on the dollar for their profits. The key though was that their volume was far bigger than ours so a lot more dollars were coming in for them, so their pennies really added up. On top of that, because they could operate at a larger scale, they were able to offer more services and hardware for less than we could if we were to remain profitable. Our options at this point were either to try to get the loans and backing needed to compete with the big boys or close shop. I didn't feel comfortable yet competing with other businesses at that level. I had not yet learned enough and felt that it was a great risk to take.

This is not all a bad thing though. I learned even more about business and got to taste a little bit of success even more so that with the T-shirt business. Another added little bonus was that we got to be on the radio one time. It was a spot of time on the radio where a regular host would take calls about general computer problems and information. Through an acquaintence of ours, we were offered a chance to sit in on this show and talk to the host and respond to listeners and depate on computer related topics of the time. If I remember correctly, we got to plug our little business too. So overall, more knowledge, success, and some worthwhile experience more than made this a rewarding opportunity.

More to come...

Thursday, December 24, 2009

A must read for those interested in financial success.

As I mentioned before, education is very important if you want to be successful at anything. It doesn't mean you have to go to a school or university to be educated. Many people overlook self education. You can learn to do just about anything with little to no money. Books are written on endless topics.

For those of you who are finally recognizing that you want more out of life than to go to and from work until you die and get paid very little for it, you need to change the way you think about how money is made. If you have realized that there is something different about the way rich people do things compared to the way that broke and poor people do things, but you haven't figured out what that is, I have a suggestion for you. Robert Kiyosaki's "Rich Dad Poor Dad" is the book you should read first. By the time I read this book, I had already learned many things about business and finances, but this book still turned on more light bulbs for me. He explains how rich people get richer and poor people get poorer. That one little piece of knowledge will set many of you free.

I will explain a little bit of it now. It is very simple. The key note is that rich people do and buy things that make money. Poor people buy things that cost money.

Some of you might read this and think, "Duh! I already knew that". Well, congratulations to you. It just means you are already aware of this fact and are set to put that idea in motion.

Others will read that and it may or may not make sense. Ok, for you, here is a little bit more.

Most poor people go to work and make a wage. They then go and spend that money on rent or mortgage, food to eat, things they want and need. For most poor people, they are lucky to break even before their next paycheck. Sometimes it's worse especially those who use credit cards incorrectly and put themselves in debt. Many times, people will spend more money than they make and create a hole for themselves to fall into.

On the other hand, rich people spend money on things that will return money to them. For example, they may own a business. That business has expenses such as inventory. When they sell items from that inventory, ideally, they are making a profit. That is, the customer is paying more for an item than the business owner spent on it. Business owners buy wholesale and sell at a higher price. Some people write books. They will spend some amount of money to get the book published with the idea that the sales of the copies of the book will return more money then it took to publish it.

I am probably not explaining this very well, so I definately suggest you read the book to learn about this and other things he writes about. The basic idea though is that rich people end up with more money coming in than going out. This grows as they use that money coming in to invest in more things that return money. That is how the rich get richer. They don't just take their money and buy lots of stuff to have. They use their profits to invest in more things that will return profits. It is a system that almost feeds on itself.

If you can find something to put your money into that will bring you more money back than what you spent, then that is one stream of income. Then you repeat that over and over to build multiple streams of income. The trickiest part is to get that first stream going. Once you have it rolling, just keep it growing.

I hope that someone benefits from this and I hope you read that book if you have not already. It will be a real gem on your bookshelf. Just keep on learning.