Millionaires’ Guide to Making Millions
If you want to learn how to fly a plane, you’ll hire an experienced instructor. Same, if you want to make millions and become fully independent, you really want to listen to millionaires such as Richard Branson, the legendary Warren Buffet, Jim Rohn, Mike Cuban and alike.
But for some strange and irrational reason, when it comes to success and money, most people are reluctant to hear the words of those who made it. They just prefer to stick with envy and engage in blaming game and self-pity.
T. Harv Eker best explains this phenomenon one of his Wealth Files:
“Rich people admire rich and successful people. Poor people resent rich and successful people.”
For those who are willing to listen, we made an efficient guide to making millions – a condensed wisdom, leadership, and ingenuity of few of the most successful people of our time; the walking proofs of how even the science fiction can turn into reality.
We won’t fly into the orbit just yet. It’s always better to start with something simpler until we become experienced.
You are going to learn how to take those first baby steps into the world of high-end entrepreneurship.
Millionaires will help to guide you through the process with their experience. For that purpose, we handpicked a couple of the most influential points they made over the course of time that we will here decrypt and further explain.
It’s a sequence of steps that you should follow where everything starts with the idea that’s been swirling in your mind for some time now.
Is it a sure deal?
Let’s find out.
STEP 1 – The INSTINCT
You’ll often hear how good instincts are what separates success from failure. We could also add that following them is that tip of the spear that makes people like Branson and company so successful.
As pornographer, Larry Flint once said, “Once I began following my own instincts, sales took off and I became a millionaire. And that, I think, is a key secret to every person’s success, be they male or female, banker or pornographer: Trust in your gut.”
Still, regardless of the fact that we all know that, most people are reluctant to follow their gut feeling and here’s why. Listen closely because we will explain why sometimes, after a thorough consideration, you change your mind and it turns out that you made a mistake. It would be better if you followed your gut instincts instead.
First, let’s hear how important instincts are to Sir Richard Branson, founder of Virgin and one of most successful dreamers our species has ever seen:
“Never be frightened of taking risks and always follow your instincts! Don’t be afraid to take that leap into the unknown.
I definitely go on gut instinct but it has always had the backup of research and information.”
System 1, as Kaneman called it, is that fast, instinctive, “hunch” thinking, where the brain pulls out the memory blocks at the speed of the light and answer (decision) just pops in front of your eyes.
System 2, however, is the analytical, cold, emotions-free and definitely logical system of thinking that gets activated AFTER the System 1 – if you allow it.
It’s like when you are playing a card game, let’s say poker, and you really get that first feeling about what to play. That’s System 1. A complex process that’s occurring in less than a blink of an eye. If you wait for just a few more seconds, System 2 takes over and you are changing your mind. Sometimes it turns out to be a good decision but often not.
How to know when your “hunch” is right and when it may lead you to a disaster?
Tip: start taking notes about your averages, just to see how efficient your System 1 really is!
The logic implies that you should always wait for the System 2 to kick in. After all, that part of your thinking process doesn’t rely on hastily analyzed data. We are talking about hardcore calculations occurring in a background, with the power to force you to get the book or open your laptop to seek for missing information.
In gambling, just like in business, the odds are always against you!
Naturally, in both situations, System 2 will sound the alarm and activate your defense system – every time. It will always yield a negative opinion and will try to remove you from the “danger.”
System 1, however, will never do that, because the odds have nothing to do with the process. You’ll either “feel” the opportunity or not.
That doesn’t change the fact that System 1 is often wrong. That fact can be easily proved with the age-old “The ball and the bat” question that goes like this:
“The ball and the bat cost $1.10. If you know that the bat is $1 more expensive than the ball, how much is the ball?”
What you need to know is this: your brain is capable of some unbelievably complex operations that you are not even aware of. There’s no computer even remotely capable like the human brain is. And we have predominantly talked about System 1 here or the “gut feeling.”
But since it’s inherently wrong in a large number of situations, making mistakes along the way is inevitable. Yet, every mistake — no matter how odd this sounds — is building up the overall experience, improving the efficiency of that tricky System 1.
The situation presents a real “Sophia’s choice” because every time you are thinking about some opportunity, you’re being torn apart between what you feel you should do and what you think you should do.
2% of the population goes with what they feel, no matter where it might lead them. 98% wait for the System 2 to kick in and give up entirely. That’s the reason why 2% of the entire human population hold 86% of everything this planet has to offer!
Now, let’s recall a part of Branson’s quote: “…but it has always had the backup of research and information.”
If you have a gut feeling that you should start something, then you should start the real prep work on it. And the real prep work includes using much of the System 2 and its analytical capabilities.
For instance, let’s say that you want to design the next generation smart wallet for men. The idea just popped into your mind one day and your gut feeling is telling you that you should embark on that endeavor.
But you don’t just get the sketchbook and invest $30,000 in building a working prototype. Due diligence is a must. System 2 must be employed in the process to be effective. You have to investigate the market and see what else is there and WHEN was it released on the market. It can take more than three months to properly research your competition and feel the pulse of your targeted market.
Never forget what Warren Buffet said:
“The difference between successful people and really successful people is that really successful people say no to almost everything.”
It’s a process where you are using both System 1 and System 2 simultaneously to work out your business plan to every last detail. An exhausting process, not suitable for everyone with only one goal: to see if it’s a go or no go, in an elaborated way.
And, if you want to do it efficiently, you need:
STEP 2 – The PASSION
Too much has been said on a subject of passion when it comes to startups and businesses in general. The problem is that people are not quite getting the true meaning of that applied form of the term passion.
While it shares much of similarity with it, there’s a difference between passion you feel on a sexual or emotional level and passion for some sport or achievement.
The difference is that you can’t detach from the emotional connection you feel towards a person because of the oxytocin influence, no matter how logical that move would be. Your “feeling” is totally ignoring the logic implied by the System 2. That analytical part of your thinking process is screaming how that person is not right for you. That you should move away. Yet, you are ignoring the hint and go with your gut feeling.
In case of businesses or some other type of success, like climbing the Mount Everest for instance, passion is the energy that serves as the ultimate motivator. It’s that drive that pushes you forward, enabling you to reach the end line, it’s much like the case with relationships.
But unlike love, you can easily detach from unfavorable option as suggested by your System 2. There’s no oxytocin influence in the process. That gives you a steering ability to avoid holes and obstacles along the way.
When you combine INSTINCT with RATIONALITY and PASSION, you are perfectly capable of changing the odds in your favor because the rules of engagement are set by us, the humans. It means that we can influence the odds every time we want and there are millions of examples where one man managed to challenge the odds and change the world.
Who says that you can’t achieve the same effect? If, of course, you are passionate enough about it.
Like Jim Rohn likes to say:
“When you know what you want, and you want it bad enough, you’ll find a way to get it.”
But what about your motives?
STEP 3 – The MOTIVES
Are you starting a business for your own personal well-being? Of course.
What happens after you make some progress? Do you continue focusing on your own gains?
Simon Sinek, the famous business coach, and motivational speaker, has this brilliant philosophy he calls:
“Always start with WHY.”
And the following quote from Richard Branson offers the answer to what that WHY might be:
“Ridiculous yachts and private planes and big limousines won’t make people enjoy life more, and it sends out terrible messages to the people who work for them. It would be so much better if that money was spent in Africa and it’s about getting a balance.”
What’s that telling you? And remember, it’s coming from one of the most successful people on this planet; the man who knows no limits to what can be achieved.
Successful entrepreneurs are not helping others through charity work or non-profit institutions just for tax deductions, as many believe.
Most of them understand and respect the need for at least some kind of equilibrium.
In other words, Your motives should far exceed your personal agendas.
For you to succeed, you need to include the benefits of the others into the equation. That means that you must start giving back one way or another, without thinking about your own profit.
It’s that big WHY Simon Sinek is always talking about.
But as you know already, there are always those who will do their best to talk you out. Wherever you turn, there will be DOUBTERS. And they will start showing their faces BEFORE you start.
STEP 4 – Dealing with DOUBTERS
If we are to believe Jim Rohn’s claim,
“You are the average of the five people you spend the most time with,”
Then we should be very cautious with whom we are spending our time.
The important thing to know here is that there are doubters, and then there are those who know their business – the experienced analysts, who know when something just doesn’t fit in.
Your job is to distinguish these two groups because it may easily decide the future of your business.
How do you do it?
If Matt works as a mechanic and struggles to connect the ends, you definitely don’t need his doubt. The man has already proven that he’s never used the System 1. He’s fonder of “sure” things like having a fixed-paid job, where someone else is doing the hard thinking. You could listen to what he has to say, but don’t expect any wise conclusion.
But if George has at least some experience in running the business, there’s no harm to listen what the guy might say. However, if George failed and was forced to shut down his business for any number of reasons, you should take his words with caution because George got spooked. He now sees risk and danger in any kind of new endeavor.
At the same time, your close neighbor Jack drives a brand new BMW. He’s got this new one because his “old” BMW was already a year old. And he’s got a big ass swimming pool in his backyard. Why not knocking on his door and ask for the advice?
You see, the problem with men is that they are reluctant to take the leap into the unknown, no matter what their gut feeling is telling them. At the same time, they know how cowardly they appear to the others so to defend their positions, they will do whatever they can pull you down and equalize the situation. Just so no one would think they are pussies. People like that will never knock on Jack’s door, even if he lands the spaceship in front of his garage.
Bottom line: always take the person’s background into consideration.
With INSTINCT, RATIONALE, PASSION and a GOOD MOTIVE in your pocket and DOUBTERS moved away, you are ready to start.
STEP 5 – The START
This is where you must leave the thinking to System 2 because your System 1 is, well, reckless.
Back to our smart wallet example. You have a cool upgrade of this everyday item on your mind. Something others didn’t come up with. It will work, no doubt about that. Every single analysis is a point in that direction.
How long has it passed since the most recent launch of the similar product? Is the timing right?
System 1 will have no doubt about it. It will push you to start the show. And it won’t be hard for it to do it because you’re passionate about the entire deal and your gut feeling is telling you that you simply can’t miss.
The truth is: System 2 is smarter in these kinds of situations.
Your idea might be the greatest of all but if you miss-time the market, you’re in for some long and exhausting waiting until the market finally opens up. It can ruin your financial situation or at least cause less favorable initial results.
We are talking about the satiety index of the market here that is similar to the satiety you feel after a great meal. If you are full, you simply won’t care about the dish on the other table, no matter how tastier it looks.
Many startups fail to do their homework, which causes the launch of their solutions in wrong time. Since most of them are short with capital, the time they have to wait eats them alive.
If your solution obeys the rules of the business, you’ll make it work sooner or later. It’s the matter of optimal timing, that’s all.
Sir Richard Branson explains those rules in a single paragraph:
“First and foremost a successful business must have a sound knowledge of its market and work on how its product or service will be different, stand out and improve people’s lives. If you can ensure it responds to a real need out there in the marketplace, your business can punch well above its weight.”
However, even if you do everything right, the failure is always an option.
STEP 6 – Dealing with FAILS
In an interview he did for Foundr magazine, Branson said this on failures:
“I’ve had many challenges – every entrepreneur does – it’s the nature of the beast. It can be a challenge not to let failure, or negativity from others, prevent you from going after what you believe in and what in your gut you know can work.
However, it is important to face these challenges head on and give them a go and importantly don’t beat yourself up if you fail – just pick yourself up, learn as much as you can from the experience and get on with the next challenge.
I’ve taken many knocks over the years, but it has only made me stronger and more determined to succeed.”
Warren Buffet has this to say about failing:
“I bought a company in the mid-’90s called Dexter Shoe and paid $400 million for it. And it went to zero. And I gave about $400 million worth of Berkshire stock, which is probably now worth $400 billion. But I’ve made lots of dumb decisions. That’s part of the game.”
It all corresponds to Mark Cuban’s favorite quote:
“You just have to be right once.”
Nothing much to add to this besides this simple question:
How did you learn to walk?
ANSWER: By using a system known as “trials and errors.”
Your baby-brain learned from hundreds of fails. Not one did act discouraging.
Every drop on your butt thought you something new. Like that grabbing a leaf of a tiny plant, your mother placed on a living room table will not help you keep the shaken balance.
Eventually, with experience earned through many fails, you walked across the living room without anyone’s help and made your mother cry from all the joy and proudness she felt in that single moment.
Wake up that baby again. That’s all there is to it. And make sure to forge the last and probably the most important skill for every entrepreneur:
STEP 7 – The LEADERSHIP
Do you like your boss?
Incompetence? Utter selfishness? Borderline enslaver mentality?
If you talk to employees across the sectors, you’ll end up with the mind-blowing conclusion. 80% of all executives are perceived in a negative way by their workers and considered as primary reasons for non-optimal or even poor results of the companies or units they are running.
They all lack good leadership skills because the majority didn’t “earn” their position in an appropriate and expected way.
But why would you even be concerned about your own leadership skills?
You might start the show alone, but if all goes fine, you’ll inevitably start building the team.
The team’s efficiency does not depend on their individual skills but on your leadership.
According to Sir Richard Branson, this is what good leadership means:
“I believe a good leader brings out the best in people by listening to them, trusting in them, believing in them, respecting them and letting them have a go. When employees tell you about their good ideas for the business, don’t limit your response to asking questions, taking notes and following up. If you can, ask those people to lead their projects and take responsibility for them.”
This might easily be the best thought on leadership we’ve heard in years, but here’s another one coming from Jim Rohn that explains the character of a leader:
“The challenge of leadership is to be strong, but not rude; be kind, but not weak; be bold, but not bully; be thoughtful, but not lazy; be humble, but not timid; be proud, but not arrogant; have humor, but without folly.”
Do you like that? Do you have what it takes?
There’s only one way to be sure. And that’s taking the action.
Your next move is obvious
If you have an idea swirling in your mind and your gut instinct is telling you that you should make it happen, follow the STEPS we explained here and get that show on the road.
You don’t have much time to see what happens, but you have all the time in the world to regret not even trying.
Fail is a lesson, not the end of the line.
By the way, in case you were wondering, the answer to the “Ball and the bat” question is not $0.10. Do the math. It’s $0.05. System 1 screwed you over.
The funny thing is that after you make calculations and get the real answer, you’ll be having a hard time detaching from the impression left by System 1.
It’s a simple demonstration of how utterly powerful System 1 really is and how easily it may lead you in the wrong direction. Thus, expose yourself to the opportunities and fails to improve your responses and start building the way to your first million!