- Fear is one of the few reasons why people who want to get rich never do. Get used to fear nothing.
- Ownership is everything. Never distribute shares of your company to anyone. Seek to own as many shares in as many businesses as possible.
- Execution is worth one thousand times more than an idea. You can succeed on execution alone.
- The first step is the hardest one to take.
- Choose a business in a growing market with low startup costs. It’s easier to build a business doing what you like and what you’re good at. Use your intuition.
- Most people will have to borrow capital to obtain it. This is the worst part of getting rich. Avoid credit card companies and shark-like banks; avoid VCs; prefer small, local banks.
- Never give in. Never give up.
- The five most common errors are desiring to be rich instead of having the compulsion to, overoptimism about cash flow, not stopping to do something that doesn’t work, thinking small and acting big, and not hiring or nurturing talent.
- Talent is one of the most important parts of getting rich as these are the people that will make money for you. Only hire smarter people than you, and nurture them, and grow them. Then delegate your work to them. When they work well, share profits with them. But never give them shares.
- Remember that it’s only money, and money isn’t important. Love, health, and having fun are.
- Exit your business when you can and sell as soon as you grow bored or uninterested.
Table of Contents
Click to expand/collapse
- Summary of How to Get Rich Written by Felix Dennis
- Part One: Reasons Not to Get Rich
- Part 2: Getting Started
- Chapter 3: Harnessing the Fear of Failure
- Chapter 4: The Search
- Chapter 5: The Fallacy of the Great Idea
- Chapter 6: Obtaining Capital
- Chapter 7: Never Give In
- Chapter 8: The Five Most Common Start-Up Errors
- Part 3: Getting Rich
- Chapter 9: Cardinal Virtues
- Chapter 10: A Few Words About Luck
- Chapter 11: The Art of Negotiating
- Chapter 12: Ownership! Ownership! Ownership!
- Chapter 13: The Joys of Delegation
- Chapter 14: A Piece of the Pie
- Chapter 15: The Power of Focus
- Part 4: Troubleshooting and Endgame
What How to Get Rich Talks About
How to Get Rich is a book written by the media mogul Felix Dennis. It explains the principles Dennis used again and again to finish his life with a fortune of $500 million.
It’s a good book, different than the others in the fact that Dennis insists a lot on talent and on the fear of failure.
If you fear nothing on one hand, and can hire smarter people than you and nurture them so they make money for you, you will get rich.
Summary of How to Get Rich Written by Felix Dennis
How quickly can you get rich? Quicker than you deserve, but likely too slow for your liking.
Just know that there are no shortcuts.
Knowledge learned the hard way combined with the avoidance of error, whenever and wherever possible, is the soundest basis for success in any endeavor.
The kind of people who become rich are those who are confident that they can become rich.
Let’s bust some myths.
- No one gets rich by accident. All who got rich wanted to get rich.
- Execution is 1000 times more important than a good idea.
- It wasn’t easier before and it’s still possible today. If you think that it can’t be done and dwell on that thought too long, then you are likely to remain poor.
Becoming rich does not guarantee happiness, quite the opposite.
Money, it turned out, was exactly like sex. You thought of nothing else if you didn’t have it, and thought of other things if you did.
Part One: Reasons Not to Get Rich
Chapter 1: Pole Positions
Getting started is one of the hardest things to do.
- Young and broke: you have the best chances of getting rich because you have time, stamina, and nothing to lose.
- “On your way up“: this is the point where most people think about starting a business because they have experience. But they’re afraid of failing and losing what they have. Now is the time to decide what you want. You don’t have much time left.
- Senior manager and professionals. They experience the same problems as above but with the stamina. Just know that your mortgage, kids, wife/husband, etc, are not the real problem. The problem is the fear. Will you dare to try?
Conventional wisdom will try to discourage you from becoming rich.
Never trust the vast mountain of conventional wisdom. It contains great nuggets of wisdom, it is true. But they lie alongside rivers of fool’s gold.
The earlier you start and the more risks you are prepared to run, tempered by listening hard and choosing the right mountain (we’ll come to that later), the more certain it is that, sooner or later, you will find yourself with a small success on your hands.
Chapter 2: A Million to One
“Dare not” is one thing. “Cannot” is another.
Not everyone can be rich.
- Unhealthy people think more about their health than their bank accounts anyway.
- Old people don’t have the stamina to become rich.
- Those who have no desire to get rich won’t be rich either.
Part 2: Getting Started
Chapter 3: Harnessing the Fear of Failure
The fear of failure is the main reason why those who want to get rich never start.
Starting is one of the hardest things to do.
“Once begun—the job’s half done.” Because taking that first, irrevocable step has proved to be the most difficult part of nearly every venture I have been involved in.
No matter how much faculty of idle seeing a man has, the step from knowing to doing is rarely taken.Ralph Waldo Emerson
Many people will discourage you from starting because your success would highlight their failure. They’ll always list 37829 reasons why your project will not work. Don’t listen to them.
At the end of the day, it’s almost always better to try than not.
And looking back, I have to say that I regret the majority of the times I acquiesced in shilly-shallying and a retreat to safety. I would rather have tried and failed, in most cases, than have taken the safer course that so often appears to be wiser in the abstract.
If you wish to be rich, you must grow a carapace thick enough to shrug off the inevitable sniggering and malicious mockery that will follow your inevitable failures.
Finally, if you can’t do at least one of the following, don’t try to get rich.
- If you are unwilling to fail, sometimes publicly, and even catastrophically, you stand very little chance of ever getting rich.
- If you care what the neighbors think, you will never get rich.
- If you cannot bear the thought of causing worry to your family, spouse or lover while you plow a lonely, dangerous road rather than taking the safe option of a regular job, you will never get rich.
- If you have artistic inclinations and fear that the search for wealth will coarsen such talents or degrade them, you will never get rich (your fear, in this instance, is well justified.)
- 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.
- If you cannot convince yourself that you are “good enough” to be rich, you will never get rich.
- If you cannot treat your quest to get rich as a game, you will never be rich.
- If you cannot face up to your fear of failure, you will never be rich.
Getting rich = making sacrifices, but it’s not always you who is making the sacrifice.
After a lifetime of making money and observing better men and women than I fall by the wayside, I am convinced that fear of failing in the eyes of the world is the single biggest impediment to amassing wealth. Trust me on this.
Chapter 4: The Search
Most people don’t have the courage, energy, or guts to choose what they do. They just do whatever is available.
The author himself became rich with magazines because he randomly began to sell magazines.
At the end of the day, your career choice doesn’t matter as long as it prints money.
If you hesitate between getting rich and doing something you experience a strong calling for, go for the latter.
The ability to live with and embrace risk is what sets apart the financial winners and losers in the world.
If you want to be rich, you’re not looking for a career, but for a business opportunity.
However, getting a job is also a great way to learn about an industry to build a company later on.
Don’t hesitate to be selfish. When it’s time to quit your job to do something better, do it. Your employer isn’t a part of your family.
Team spirit is for losers, financially speaking (…) in commerce it acts as a subtle handicap and a brake to ambitious individuals.
It’s the same with close friends and family members. Consciously and outwardly they may want you to succeed beyond your wildest dreams. But subconsciously, often without being aware of it themselves, they might be far happier if you failed or only succeeded to a limited degree.
What industry should you choose? Whatever makes money.
Forget about glamor. If emptying toilets make millions, then do that.
So choose a sector that is growing, and one with low startup costs, preferably.
New or rapidly developing industries, whether glamorous or not, very often provide more opportunities to get rich than established sectors. The three reasons for this are availability of risk capital, ignorance and the power of a rising tide.
Beyond that, there are three other factors involved in Search:
- Inclination: it’s easier to work in something you like than in something you do not. But don’t make your passion a fetich either. If you love painting but it sucks, you’ll never get rich.
- Aptitude: aptitude is what you are naturally talented at. The best way to judge your own aptitude is through trial and error.
- Fate: fate is naturally being attracted by the sector you’ll make your money in. Use your intuition. More often than not, getting rich is about seizing opportunities when they arise, not working in a specific sector. Fortune favors not just the brave but the bold.
Chances come to everyone in life, in all shapes and sizes, often disguised, and more often radiating risk and potential humiliation.
Chapter 5: The Fallacy of the Great Idea
Ideas don’t make money, and a great idea alone will not make you rich.
Execution is 1000 more powerful than an idea.
Having a great idea is simply not enough. The eventual goal is vastly more important than any idea. It is how ideas are implemented that counts in the long run.
However, the opposite is also true: it’s stupid not to emulate a great idea.
If your competitor does something awesome, then you better do it too, and no one cares that you didn’t have the idea in the first place.
If you want to be rich, then watch your rivals closely and never be ashamed to emulate a winning strategy.
If you never have a single great idea in your life, but become skilled in executing the great ideas of others, you can succeed beyond your wildest dreams.
If, on the other hand, you spend your days thinking up and developing in your mind this great idea or that, you are unlikely to get rich.
Chapter 6: Obtaining Capital
There are six ways to obtain capital:
- You receive or inherit it
- You can steal it
- You can win it
- You can marry it
- You can earn it
- You can borrow it
For most people, they’ll have to borrow it.
You can borrow from three types of people:
- Sharks: credit card companies. Don’t do that.
- Dolphins: banks and VCs. They’re not easy to persuade to lend money and when they are interested, they want stocks to sell later on and make a big profit on it. They don’t care about business, only money.
- Fishes: the daily people (landlord, first employee, wholesaler, small banks, etc), that will agree not getting paid right now for you to grow your business.
Persistence is a powerful tool in the hands of a hungry young hustler on the make.
Obtaining capital is the worst part of the whole business of getting rich (…) this exhausting and miserable search is what separates the wannabes from the gonnabes.
Chapter 7: Never Give In
That was the secret ingredient. I would not be a wage slave. I would not take “no” for an answer. I would not give in. I was going to be rich. Somehow. Some way. Someday soon. And I would not retreat to the safety of a decent job until I was starved out of house and home. I would not give in.
What fueled me was the desperation of knowing that unless I found a way around my lack of capital, unless I could pour my energy into a venture of my own, I would be condemned to a life of wage slavery.
You will not give in. And you will be rich.
Chapter 8: The Five Most Common Start-Up Errors
1. Mistaking Desire For Compulsion
All error springs from flawed assumptions. If there are no assumptions, there can be no error.
Wishing for something is futile if you don’t have any compulsion to achieve it.
If you keep on wishing but never deliver, your confidence will suffer.
If you don’t really want to be rich, don’t even try. The suffering won’t be worth it….for you.
Your relationships will suffer and you regret having worked hard instead of spending time with your family and friends. Such is the price of getting rich.
But to make the attempt without sufficient passion and commitment, knowing in your heart of hearts that you lack the conviction to succeed, risks the suffering of a self-inflicted plague without even the consolations the loot may bring.
When the going gets tough, when all seems lost, when partners and luck desert you, when bankruptcy and failure are staring you in the face, all that can sustain you is a fierce compulsion to succeed at any price.
The Second Error: Overoptimism Concerning Cash Flow
The only thing you really need to focus on is cash flow. No cash flow, no company, not possible to get rich.
Factoring debt is like smoking cigarettes. You know perfectly well that smoking leads to death—but that death, however appalling, is some way off. And you need a cigarette now!
Here’s what you should do to ensure that cash flow remains positive.
- Hire the minimum number of employees possible.
- Don’t sign long-term rent agreements or rent expensive office space.
- Don’t buy fancy furniture.
- Don’t pay for business meals if the other side offers to. You can show off later.
- Pay yourself the bare minimum.
- Call customers who haven’t yet paid you.
- Walk instead of taking a cab.
- If you will pay a vendor late, call them and tell them, and tell them when you will pay them, and stick to it.
- Always pay your employees even if it means you won’t eat for a week.
- Don’t give staff credit cards or company cell phones.
- Save energy.
- Play suppliers off against one another.
- Only enter a factoring deal in absolute extremity. Exit it fast.
- Keep your chin up. It could be worse. You could be one of your employees.
Obsessive monitoring is the key.
The Third Error: Reinforcing Failure
Reinforcing failure means doing things that keep on failing.
The way you stop doing that is…to stop doing that and do something else that works instead.
Errors, like straws, upon the surface flow; He who would search for pearls must dive below.
The Fourth Error: Thinking Small and Acting Big
The key is to do the opposite: thinking big and acting small.
When the author had one magazine that became successful, he went to every other country on earth to license it.
Success is never permanent; failure is never fatal. The only thing that really counts is to never, never, never give up.Winston Churchill
It’s when you think you “made it” that life throws a punch at you.
Acting small means staying humble and in touch with reality.
Acting big leads to complacency, and complacency is the reason that many successful start-ups falter.
The Fifth Error: Skimping on Talent
If you are determined to be rich, there is only one talent you require (…) You need the talent to identify, hire and nurture others with talent.
There is no substitute for talent. Industry and all the virtues are of no avail.Aldous Huxley
Talent is the key to sustaining growth. The problem with these people is that they know they’re talented and they’ll jump ship if they have a better offer somewhere else. So you need to be flexible and give them what they want.
Money is important, but they’re also attracted to new opportunities and challenges.
Young talent can be underpaid for a while, then you need to pay them well. Then they get paid based on past performances – that’s when you let them go.
Identify it, hire it, nurture it, reward it, protect it. And, when the time comes, fire it.
Talent does most of the work for you.
Part 3: Getting Rich
Chapter 9: Cardinal Virtues
Persistence is not stubbornness. A stubborn person doesn’t stop even when they should. A persistent person thinks success is just around the corner.
“Never give in” is a useful catchphrase. But don’t take it too literally. We must all surrender at some time, to love or desire or death. You will be forced into the last of these, and a fool if you never surrender to the first.
Quitting is not dishonorable. But quitting if you can still succeed is. So whatever you quit, make sure it’s something worth quitting.
Sometimes, you’re on the wrong road too.
Do not be afraid to change track, alter course or make new plans with whatever you are attempting to achieve. Especially if you sense that you are on the wrong track.
This is the core of it. Persistence is not quite as important as self-belief.
Do you believe in yourself? Do you really?
If you don’t, why should anyone else?
Without self-belief, nothing can be accomplished. With it, nothing is impossible.
Self-belief does not mean not doubting. Doubt is healthy, it’s a warning.
Trust Your Instincts
When you have the feeling that there is something you should be doing…do it.
Trust your instincts. Do not be a slave to them, but when your instincts are screaming, Go! Go! Go! then it’s time for you to decide whether you really want to be rich or not.
Make More Baskets: Diversify!
Your company/product will eventually fail and you must be prepared for it by diversifying.
Sometimes, diversifying means that your new thing will kill the old thing (Eg: PS5 sales necessarily decrease PS4 sales).
So, should you do it? Yes! If you don’t, the old thing will die anyway.
That’s what Richard Branson did. He built as many companies as he could and became a billionaire.
This advice only applies once you have built one first asset that you can automate. Don’t start 4 businesses at the same time!
Listen and Learn
When you stop listening, you stop learning, and your company dies. Listen to everyone: people with a project looking for investors, your executives, your employees…everyone.
Listening is the most powerful weapon after self-belief and persistence you can bring into play as an entrepreneur.
Listening is important, but it shouldn’t be an excuse for inaction either.
Chapter 10: A Few Words About Luck
Whatever happens, you will always doubt and there’s nothing you can do about it because luck (or the lack thereof) is real.
It can transform mistakes into good fortune or hard work into nothing.
There are five lessons you should takea way.
- Don’t make finance directors CEOs as they won’t be focused on finance.
- Don’t go on vacation during a deal as the deal will fall through.
- Get your accounting checked again and again and again.
- Never personally underwrite business loans for your company unless you absolutely, positively, are forced to.
- Listen to people who are good with money and always invest in property with a good address
Luck is preparation multiplied by opportunity.
Luck changes too. If you have been unlucky, you will be lucky. Remember to keep going through hell when you’re in it. Don’t turn around.
This “flight not fight” behavioral trait is the sign of a prey animal, not a predator. Despite what you will read in many self-improvement tomes, “partnering” and “symbiotic evolution” are no way to get rich. To become rich you must behave as a predator. You must become a predator.
Also, don’t take yourself too seriously. Money is nice, but it’s not important.
Health, family, and love are more important.
Lady Luck (…) wants crazy bastards who will tell her to take a hike or get lost if they feel like it. She won’t come calling to anyone who needs her or needs to worship her.
“Fortune favors the brave,” says the old proverb. And that’s right enough. But it seems to especially scorn anyone who wants money too badly. And it positively appears to despise men or women who fear to lose what fortune they already have.
My advice concerning luck is to laugh in the face of the Lady when she presents herself. Take what you will of her bounty and act swiftly to take advantage of good fortune. But never thank her for it. And forget her the moment she leaves to seek another victim.
- Prepare yourself for luck, but don’t seek her out. Let her come to you.
- Make your own luck
- Don’t whine or ever describe yourself as “unlucky.” (You’re alive, aren’t you?)
- Be bold. Be brave. Don’t thank your lucky stars. The stars can’t hear you.
- Stay the course. Stop looking for the green grass over the hill.
- Don’t try to do it all yourself. Delegate and teach others to delegate.
- Remember that most predators are lucky most of their lives, unlike their prey.
- Whiners and cowards die a hundred times a day. Be a hero to yourself.
- If being a hero isn’t your style, then fake it. Reality will catch up eventually.
- Just do it. It is much easier to apologize than to obtain permission
- Never take the quest for wealth seriously. It’s just a game, chum.
- Next time you bump into Lady Luck, give her a whack on the rump from me.
- Be lucky. Get rich. Then give it all away. (We’ll get to that bit later.)
Chapter 11: The Art of Negotiating
The Balance of Weakness
- Most of us are poor negotiators.
- Most negotiations are unnecessary.
- “The other side” is often just as smart (or stupid) as you are.
- In the end, “the balance of weakness” almost always decides the issue.
- In Greed vs. Need, the former usually “wins.”
All negotiations arise from weakness. (…) Serious negotiating should be reserved for serious occasions.
Most negotiation is not negotiation – it’s problem-solving and it’s reserved for managers.
Managers should be excellent at getting people to work and be happy in their jobs. The company should leave no space for nepotism and be a meritocracy.
Serious negotiations are very different from day-to-day bargaining and should be approached differently.
Serious negotiations imply that one of the parties has a weakness, and the first thing to do is to find out where that weakness is.
In the case of big companies, their main weakness is their institutional investors (if they have some) that will want the company to be on the frontline of innovation and hence buy smaller companies that are innovating.
Often the smaller companies don’t need cash as much as the buyers who want to buy them -> big companies can also get desperate.
Here’s a bunch of other advice:
- Few people are good at negotiations, including you and your opponent.
- If you’re not good, set a limit on what you will pay or accept. Don’t deviate.
- Most negotiations are unnecessary. Save them for serious occasions.
- Do your research. What you don’t know may kill you.
- The devil is in the details. Get the professional help you can, but don’t delegate decision-making.
- If you don’t approve of what your advisors say, tell them they must change their behavior or they will be fired.
- Never fall in love with the deal. There will be others coming.
- Don’t buy stuff at auctions as you will always pay more.
- The negotiator opposite you is your enemy. Besides courtesy, you have no obligations toward him.
- If you are emotional or passionate about something, let it show, but remain courteous, and, if possible, with wit.
- Listen, listen, listen, and use silence as a weapon. You are in no rush.
- Choose a rogue element to your advantage and bring it into the negotiation at a late stage. You’ll be amazed at how often this tactic produces results.
- Divide and rule. It always works.
- Get rid of anyone who won’t follow you. Do not (ever) be divided and ruled.
- If you’re really bad at negotiating, get someone else to do it.
- Identify the balance of weakness.
- Whatever you agree, follow suit. Nobody does business with those who don’t respect their side of the bargain.
Chapter 12: Ownership! Ownership! Ownership!
Ownership of any kind is nonsensical. It is absurd and defies reason because we are all mortal and we cannot (as yet) take it with us.
This means that getting rich is a game – a delusion.
Getting rich shouldn’t be the be-all and end-all of your life, or anyone’s life.
But if you chase money desperately in the earnest belief that you can never be happy without it and seriously think that the chase is a meaningful occupation, I doubt very much you will succeed. You have to be fiercely determined, true. But an appreciation of the absurdity of the chase helps enormously.
Ownership Is the Only Thing
To become rich you must be an owner. And you must try to own it all. You must strive with every fiber of your being, while recognizing the idiocy of your behavior, to own and retain control of as near to 100 percent of any company as you can.
Never, never, never, never hand over a single share of anything you have acquired or created if you can help it. Nothing. Not one share. To no one. No matter what the reason—unless you genuinely have to.
Ownership is not the most important thing. It is the only thing that counts.
When four employees asked Felix for shares, threatening to walk out if they didn’t, he fired them on the spot.
I will not give them a share. Not one. Not for love. Nor for loyalty. Not to be fair. Because capitalism isn’t fair. Life isn’t fair. The lottery of what genes we are born with isn’t fair.
Except for your loved ones or closest friends, it’s every man for himself in this world, in case you haven’t noticed.
If you do have to share shares, ownership will depend on:
- Who is putting what capital into a venture?
- Who is doing what work on that venture?
Chapter 13: The Joys of Delegation
Delegation and promotion are among your most important weapons to get rich. You delegate to see how someone’s doing in your job then you promote them if they work well (work hard, love their job, and ask intelligent questions).
Fire the resentful power-grabbers who don’t do anything except terrorize people.
Not everyone works to get rich. In fact, most people do not. But almost everyone wishes to be respected. With promotion comes respect.
Do not seek a replica of yourself to delegate to, or to promote.
Rather, find people whose strengths are your weaknesses. It’s wrong to delegate to people who are exactly like you.
By setting an example early on with a program of carefully tailored delegation and well-deserved promotion, you will create an atmosphere of loyalty, efficiency and camaraderie that feeds upon itself.
Good morale, a pervasive feeling of “us against the world,” combined with the promise of responsible delegation and promotion based on achievement, can move mountains.
Realize that within your company, the work of your employees is more important than your work. Your work is to lead and tell people what to do, and their work is to do it well.
Delegate. If you don’t, you’ll exhaust yourself.
The author no longer runs his companies and rarely joins board meetings, but he still controls them.
He created a list of things that cannot be done without his approval.
- Voting someone on or off the board.
- Physically move the headquarters of the company.
- Dispose of, or shut down, any substantial asset.
- Purchase, or launch, any substantial new product or business.
- Award themselves bonuses or salary increases
Allow young managers to make mistakes and don’t blame them when things go wrong.
Chapter 14: A Piece of the Pie
Reward your employees by sharing with them the annual profits of the company and use the rest to grow it. Don’t worry if your sales managers earn more than you – that’s how things work.
Don’t share the money you earn when you sell the company with your employees. At the end of the day, it’s each man for themselves. Your employees would have left you for a better position somewhere else.
The meek shall inherit the earth, but not the mineral rights.
Your employees get a monthly salary, pension, benefits, holidays, etc. They didn’t take the risk to build a company – you did.
So they’re not entitled to a part of the pie.
Now…there are exceptions.
- Very senior managers who turned down attractive offers from elsewhere to stay with the company and grow it.
- Very long-term employees.
- Key employees who made a crucial difference.
For whatever reason, a surprising number of first-class employees (managers or otherwise) are not overly motivated by money. They want security, or respect, or the chance to learn or the opportunity to shine.
All they need for that is a monthly salary, motivation, and respect.
You and I are different: we want the money.
Understand that others are not incentivized by the same things that you are.
You won’t go far if you only offer money as a motivator. Use praise, courtesy, fairness, integrity, and camaraderie.
Here are 21 ways to grow your company. Note that each depends on you, your personality, and your individual circumstances.
- Pay high bonuses to performing employees.
- Separate money invested in new projects from company earnings and expenses.
- Keep costs low
- Never delegate bonus allocation.
- At senior level, insist on collective responsibility for bonuses.
- Praise excellent work. Not good work. Excellent work.
- Fire malingerers, incompetents, toads, and glory hounds mercilessly.
- Don’t give company perks.
- Don’t fly the sales team on holiday to “boost morale”. Offer them legal perks you have paid so yourself. For example, enable them to use your house or car when they perform well.
- Set an example: don’t get a fancy office if you don’t want the employees to have one too.
- Go over annual results with your senior managers.
- Back up your managers in public. Don’t contradict them. Punish those who badmouth their peers.
- Promote talent.
- Interview your rival’s talents.
- Don’t be secret. Share stuff with people. They will work harder for you in this way.
- Share successes with suppliers. Take them out to dinner.
- Don’t badmouth rivals – praise them.
- Sell early. Assets don’t grow forever. The purpose is to become rich, not a manager.
- Enjoy the business of money-making.
- Never miss promoting your asset.
There is no amount of pie in the world worth being miserable for, day after day. If you find you dislike what you are doing, then sell up and change your life. Self-imposed misery is a kind of madness. The cure is to get out.
Chapter 15: The Power of Focus
Keep your eyes on the prize: money. Don’t fall in love with your company or industry. If a big company comes to buy yours, sell if that can make you rich.
If you have entrepreneurial flair, then you can go into just about any business and make money.
If you wish to become rich, look carefully at the prevailing industries where wealth appears to be gravitating. Then go to where the money is! That is where you should focus your efforts.
The second thing you need is timing. That’s mostly random, but you improve your chances by doing stuff.
The third thing is environment.
You cannot get rich all on your own. No one can. You have to create, or work within, the right environment.
Human capital is by far the most important element of your environment, whether you are just starting up or deep into the game. By focusing hard on obtaining that human capital you will vastly increase your chances of becoming rich.
Hire clever, cunning, and adept people. They will work for you because most of them are risk-averse – and you are not because you want to get rich.
You do not need to be clever. You do not even need to be that adept. You need only a little cunning and massive determination to become rich.
Here’s how to choose employees and suppliers:
- Don’t choose them alone. Get someone to interview them too.
- Get references about that person.
- Take notes and don’t talk too much when you interview them.
- Good suppliers are conscientious.
- Pay your employees well and give them bonuses.
- Be aware that someone may not fit one position well but may fit another position very well.
- Only hire winners, no losers or whiners.
- Ignore your own prejudices. Hire who’s good, not who you like.
- Promote from within when you can.
- Don’t leave senior employee in their job for too long or they will fall asleep.
The fourth thing is to do an outstanding job.
Ownership Shall Be Half of the Law; Doing an Outstanding Job Shall Be the Other Half. There is no point in owning 100 percent of a rubbish company.
When you do a great job:
- Talent wants to work for you.
- You’ll make fewer errors.
- It places a premium on the worth of your asset.
- It’s more enjoyable.
Part 4: Troubleshooting and Endgame
Chapter 16: Whoops!
It’s important to analyze why you fail when you fail.
If your unprofitable asset can be sold to somebody, sell it.
If it can be spun into something else do it.
Only shut down in a last resort. Realize that shutting it down will cost you money too.
Whatever happens, don’t despair. It’s only money. Despair is only allowed when death and disease are upon you.
The more honest you are about your misfortune with those affected by it, the easier the comeback will be.
Realize that your company ≠ you.
You can’t use the company’s money how you’d use your own money.
Pay your taxes.
Chapter 17: A Recap for Idler
Most of us love shortcuts, though they often lead us astray.
Don’t worship money. It will decrease your inner core, your integrity, your belief in the worth of others, and the love of those dear to you.
Make sure that getting rich really is what you want when you pursue it. Most people should not. Getting rich will neither make you happy nor free. It will take a lot of time. And time is all you have.
Cut loose from naysayers and negative people and anyone trying to discourage you or tell you it won’t work. And of course, cut loose from working for other people.
Get over the fear of failure. This is the only roadblock on your way to wealth.
Choose the right market.
The world is full of money. Some of it has your name on it. All you have to do is collect it.
Don’t get into an old market unless you have a new angle to go there with.
Don’t do anything because you feel you have to. Go for what attracts you. Go for something that exploits your natural talents. Go to the mountain which produces money. Money that has your name on it.
Easier said than done. Realize that one day, you will die, and that one day, everyone you know will die too.
If you can do it, this will transform your life. Not for the better. I didn’t promise you that. But you will instantly perceive just how much money there is in the world and how pitifully easy it is to obtain it.
You must make an accommodation with your fears if you are to succeed.
Finally, you have less time than you think. So go. Don’t waste it.
You will never start unless you start NOW!
If you wish to get rich, there are no reasons why you should not get rich. None at all.
The only three valid reasons for not attempting to become rich are: “I do not wish to be rich.” Or, “I wish to be rich but I have other priorities.” Or, “I am too stupid to try to get rich.”
Chapter 18: How to Stay Rich
Don’t do drugs, don’t pay for sex, don’t waste money on cars or alcohol.
Minimize your taxes, but pay them.
Here are a few other hard lessons the author learned.
- Give your money away: The faster you give it away, the more money will flow back to you because you’re less focused on keeping your money and more focused on making some.
- Forget about money you have spent, invested, loaned, or given: if you get any return, good! But it shouldn’t be your primary concern (unless you have invested for the sake of safety).
- Never loan the money to your friends or family: you will lose both of them.
- Get through insane spending as fast as possible: the private jets, fancy cars, champagne, will destroy your health.
- Your oldest friends are your only friends: not all of them will be comfortable with you being rich. As for the ones who are, get used to reaching out to them because….
- You will be cut off: a lot of people will try to take money from you.
- Remain open-minded: don’t cut people off your life, keep on hanging out with them, especially if they don’t know how rich you are.
- Get other hobbies besides making money
- Get your own private advisers: they must be the best at what they do. There is no substitute for a first-class lawyer, tax advisor, accountant, auditor, estate manager and business advisor. Do this earlier than necessary.
- Watch out for fraud: people will try to steal from you, especially in the early days.
- Don’t try to be friends with your staff: they know you’re worth more than them and that it’s phony to try to be “one of the boys”.
- Don’t sleep with your staff.
- Choose personal aides with enormous care: they must work for you, not for the company. If they don’t work out, fire them, but be very gentle. Tell them it was you.
- Don’t abuse people: being rich doesn’t give you that right.
- Hire security: you may feel like a fraud, but it’s an important thing.
- Never stop looking for talent and promoting it: if you are known for being kind to talents, talents will flow to you.
- There are no such things as “must-do deal”: don’t get into trouble overreaching.
- Lead – don’t be led: you are the owner of the company. People look up to you and wait for you to tell them what to do. Sometimes it’ll get hard to get them to work, but that’s what you have to do.
- Stay as healthy as you can
- If a company bores you, sell it: Your lack of enthusiasm leaks out of you and infects those around you. They can sense it and they will find it hard to forgive and easy to emulate.
- Sell before you have to: buyers are looking for growth in a business. Sell it while there is still growth to achieve.
- Retirement will kill you. You will never stop working.
- You’re only richer than them, not smarter than them: making money doesn’t mean you are smart. Remember to hire smarter people than you. Believe in your own bullshit and grow steadily poorer, or listen to the people you employ and get richer and richer.
Chapter 19: The Eight Secrets to Getting Rich
- Analyze your needs. Desire is insufficient. Compulsion is mandatory.
- Cut loose from negative influences. Never give in. Stay the course.
- Ignore “great ideas.” Concentrate on great execution.
- Focus. Keep your eye on the ball marked “The Money is Here”. Remember that the purpose is to get rich, nothing else.
- Hire talent smarter than you. Delegate. Share the annual pie.
- Ownership is the real “secret.” Hold on to every percentage point you can.
- Sell before you need to, or when bored. Empty your mind when negotiating.
- Fear nothing and no one. Get rich. Remember to give it all away.
Chapter 20: Remember to Duck!
Technology changes. Tools change. The social landscape changes. Human nature does not change.
Never retreat. Never explain. Get it done and let them howl.Benjamin Jowett
For more summaries, head to auresnotes.com.
Did you enjoy the summary? Get the book here.
Subscribe to my bi-weekly newsletter and I'll send you a list of the articles I wrote during the two previous weeks + insights from the books I am reading + a short bullet list of savvy facts that will expand your mind. I keep the whole thing under three minutes.
Oh, and you'll also receive a hidden article for new subscribers only!
How does that sound?