Simon’s Notes

Most of us have heard of failing forward, or falling upward.  Both those terms basically mean leveraging your mistakes and using them as a springboard for greater success.  But here’s an interesting one, ‘quiting for success’.

I first heard about this concept from Dawud Miracle over at dmiracle.com, and it’s actually something that most of us know subconsciously but we sometimes find it hard to implement.  For a lot of people, the thing that holds them back from any sort significant success, is all the insignificant projects that they hold on to.  Typically 80% of what we do only contributes toward 20% of our success, so by quitting some of those projects that fall in the 80% category, we can actually focus more on the 20% that giving us the results.  Simple really, but quite powerful.

It’s so politically incorrect, but have you considered quitting?  It might just make you more profitable

I’d like to know what you think.

Simon

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Filed under: Money and Finances, Motivational by Simon Rodrigues
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The two most common ways of investing ones savings are paper investments, and real estate. Ok, real estate makes sense, but what are paper investments? Well, these days pretty much anything that isn’t property is a paper investment, that includes the stock market, mutual funds, forex, and you get the picture. So what should you invest in? Let me try and do a little comparison.

The biggest difference between real estate and paper assets is leverage. Lets say that you and your friend each have $20,000 to invest. Your friend wants to put it in the stock market, he’s read a few books and thinks that he’s got it figured out. You, on the other hand, want to start building up a property portfolio. Your friend, Bill, scouts around, talks to a few brokers and does a little online research and thinks that he’s found a few winners so he goes ahead. But of course with $20,000 dollars he can only buy $20,000 worth of shares. In 6 months time his portfolio grows by 10 percent (not bad) so now its up to $22,000. I’d be pretty chuffed, but now lets see what happens with you.

You decide not to look too far away, so you stat doing some property research in your local area, and, of course, you don’t mind starting small. You start off with 2 options, you can find a house for $20,000 (highly unlikely), or you can use the $20,000 as a down payment on a larger piece of property. I’ve spoken about the beauty of compound interest, but now I want to talk about the beauty of leverage. By using leverage and the banks money you can easily acquire a $100,000 property asset for only $20,000. In fact, you can easily do better than that cause if you shop a around, you can find a motivated seller who is willing to sell you a $150,000 property for a mere $100,000.

So in 6 months Bill’s portfolio grew by 10 percent, which translates to $2,000, but if your portfolio grows by the same percentage (which is more likely), you could pocket $10,000. Hows that for a bit of leverage.

If you want to look into investing in property I seriously recommend ‘Real Estate Riches’ by Dolf de Roos.

Simon

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are you starting a new business? Let me warn you now, the odds are against you making it a success. The good news is that anyone can succeed, stats are just stats, so you have to look at the reasons behind the failures. The main reasons for failure in any start up can be boiled down to one thing, and that is lack of preparation.

Of course it helps a lot if you have some idea of what to prepare for. If you know why most new businesses are bound to end up in misery you might have a better idea of what you need to look out for. I’ll get straight to the point, here’s a list of the top 9 reasons for failure in any venture.

1. The number one reason for business failures is insufficient capital. The golden rule of initial capital is that ‘it’s better to have too much than to have too little’. Sounds like a no-brainer, but you might be surprised at the staggering amount of new business owners that don’t adequately plan for capital shortages. Sort this problem out and you’re on your way.
2. The second biggest reason for failure is kind of related to the first reason, cash flow shortages. One could easily think that a new company might struggle to make a profit in the first few months, but that is often far from the truth. There are a lot of new ventures that make a good profit right from the start, but they still collapse. Why? Negative cash flow. There is no point making a profit on paper if you don’t have money in your hand.
3. Incorrect sales forecast. It’s ok to be positive, but don’t be stupid. It’s better to plan for too little than to hope for too much, that way you will never be disappointed.
4. Inadequate market research. Market research doesn’t have to be a daunting task, the important thing to remember is to poll a large variety of people, don’t just ask your friends what they think. And be sure to check out my old post on market research.
5. If you want to succeed in business then the last thing you want to do is write up a poor business plan. I’m just like the next guy when it comes to writing business plans, I don’t like it, but it must be done. There are a few things that should be included in your plan, a clear statement of your objectives, a timetable, a thorough analysis of your competitors, and a good description of the administrative procedures you intend on using.
6. For a lot of people, deciding on prices might be the funnest part of a new venture, but make sure you do it with a purpose. Instinct tells us that if we go cheap we might beat the competitors, but that is often unwise. Make sure you take everything into account, including overheads. It is sometimes better to offer a better service than a better price.
7. When you first start out you will find that you’re the magic in your business, but don’t be afraid to delegate if the need arises. A lot of new entrepreneurs want to do everything on their own, but if you spread the load you will find it much easier to manage the whole.
8. Lack of good advice. Don’t be afraid to ask for help. Don’t fall into the trap of thinking that you know everything, ignorance can be a powerful tool if you use it properly. Surround yourself with people that know about every aspect of the business you are involved in.
9. Don’t be hasty. Sometimes new business owners will rush to market a new product or service that hasn’t been properly tested or thought through, this can be disastrous for credibility. Make sure you have everything in order first.

Ok that’s it. I hope this helps. Just remember that the key to success is plan, plan, plan, and plan some more. There is no such thing as too much planning, but you don’t want to experience too little.

Simon

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So you’ve found that house of your dreams now comes the time to find a good mortgage. There are a few things to consider when shopping for the right home loan. The very first thing that you need to do is get your finances in order, if you haven’t made a budget yet, now is a good time to do that. Once you know your budget you should have a pretty clear idea of what you can afford.

There are basically two types of mortgages, one comes with a fixed interest rate, and the other is a fluctuating interest rate loan. Your first impression might be that the fixed interest rate would obviously be the better option, but you might be wrong. The fixed interest rate remains the same throughout the life of the loan, and the adjustable rate fluctuates with the current rates. So if the rates are projected to go down you might want to go for an adjustable loan, but if they might go up you might consider a fixed rate.

Another good idea would be to take a look at your credit report. The last thing that you want is for your application to get rejected because you don’t have a good credit history. If there are any bad marks on your report, sort them out before even consider a loan.

Here are a few links that might help you come to a good mortgage decision:

• Mortgages
• Compare Mortgages
• Fixed rate mortgages

Simon

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Selling is an integral part of any business, whether we like it or not. Sometimes we try to come up with different names for it, or maybe we disguise it as something else, but when the crunch comes you will find yourself selling something in one way or another. In some instances selling is when you’re trying to grab that huge account, or in other instances it might be convincing prospective investors to fund you.

Lets face it, we all hate the close. I used to get so caught up in my sales talk, and I would blabber off a bunch of nonsense just so that I could avoid the close. But there comes a time when you have to stop the chit-chat, or the sales talk and just cut to the chase. You have to close that sucker. As time went on I started looking forward to the close, and hopefully, with the following tips, you will to.

• Don’t put yourself in a position where you’re dependent on your prospect. Develop the mindset that, if the deal doesn’t go through, he will miss out and not you. If you have this attitude you will find it much easier to pin him down.
• Your job is not to make a sale, your job is to help your client or prospect. Find out what they want by asking lots of questions, then tailor your close to their needs. This works just as well if your prospect is a potential investor, find out why it would benefit him to invest in you.
• Don’t be afraid of awkward pauses. As long as you don’t break the silence, you are in control.
• Avoid “yes/no” questions. Instead of “are you interested in *******”, you could say something like “in what way could you see your company applying *******”. You want to get the prospect involved so that instead of feeling that you sold him something, he will feel that he bought something. There is a difference.
• Certain “yes/no” questions can help you lead the prospect to the close, but you should use questions that you already know the answer for. For example, you could use a question like “it’s impossible for your company to completely avoid taxes legally, right?” The obvious answer would be yes, or right, which would then lead you to the next question such as “But you must know that with proper planning you could minimize your taxes quite considerably, right?” Nobody wants to be the idiot, so the answer to that one will also be yes. With questions like these it’s quite easy to make the prospect feel that he is the one having all the ideas, and eventually you will lead him to making a purchase, instead of chasing him to make a sale.
• When the time is right, just go for it. Honesty is always the best suggestion. Start peeling away the objections. Ask something like “can you see any reason why you wouldn’t want to do this?” If he gives you an excuse then say “if we could solve that problem, you’d get on board, right?” Repeat that question till he gives you the real objection, then solve it, once you’ve done that you’ll have the prospect hooked.

The important thing is not to be phased by negative prospects. Seldom will the meeting be perfect, and if you get a negative prospect that just means that you’re one closer to the positive one.

These tips won’t guarantee a sale every time, but hopefully they will stack the odds in your favor.

Simon

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Are you a shy person? If you are you need to learn to get over it, otherwise you won’t succeed in business. I’ve said it before but I’ll say it again, it’s not what you know, it’s who you know. As a business person you have to develop the habit of always looking to build your network. I read somewhere that every person in the world is only six people away from knowing everybody else, I’m not sure how true that is, but it’s something to ponder.

Most people know at least 100 people, so your direct network of friends and acquaintances would be at least 100. But now imagine that each of your 100 friends knows another 100, suddenly your network has grown to 10,000. You can imagine how fast this can grow, and how useful networking can be for your business.

Becoming an instant networker can be a difficult habit to develop, especially if you’re shy or not used to talking to complete strangers. But once you get used to it, it becomes as easy as riding a bike. Here’s a list of helpful suggestions that might get you on your way:

• Make an attempt to notice people.
• Don’t just stand in the queue, be active with somebody around you.
• Don’t be afraid to make eye contact with people, you might have to force it at first but it’s a good way to connect with people.
• Always have business cards handy, ALWAYS, you will look very unprofessional otherwise.
• The best accessory for any business person is a smile, don’t be afraid to share yours with the world.
• Look for common ground. For example, if you are standing in queue for a long time and there is someone else there with you, you might mention something about how annoying it is to stand in long queues.
• There are 4 things that can easily start a conversation, those 4 things abbreviate to F.O.R.M. Family, occupation, recreation, and money.
• Ask lots of questions. People are never interested in you, they are interested in themselves, and they will be your instant friend if you show interest in them as well.

Today I was standing in a queue waiting to pay my cell phone account and there was a guy there also that looked like a very successful person. This guy was maybe in his thirties, he was wearing a suit, had a nice laptop with him, and was on his fancy phone, he gave me the impression that he was a very busy and important dude. I looked like a bum, I had a pair of shorts, a dirty T-shirt, and a pair of slippers that were ready for the garbage. I was certainly not in the networking mode, I didn’t even have any business cards. But I started talking to him anyway, we spoke about his business, my business, his family, and the rugby. By the time I left he was more than happy to give me his details and take mine. He is an important person in his firm, and you can bet that I will be following up on him.

Networking is an asset, cultivate it and you will see tremendous results.

Simon

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What is the most important element, yet sometimes the most subtle, of any business? Two words, cash flow. When you first start a new business there are two very deadly traps that you can fall into, one of them is too little business and the other is too much business. Obviously, one of the traps might not make much sense… at first.

Too much business? How can too much business be a problem? Too much business can sometimes lead to a shortage of cash flow. What happens is that a lot of times new entrepreneurs get a little over eager especially when they see a lot of business. Here’s a scenario, you start a new business and your business takes off, you quickly run out of stock so you make another big order. Maybe you have a few clients that are ordering a lot of stuff from you, so you have to buy more. In your eagerness you don’t pay much attention to the payment plans that some of your prospects are offering (business is a cutthroat business), maybe you accept a few checks. The end of the month comes around and you find that you’ve sold a lot of stuff but you don’t actually have any money, the creditors won’t care, they want their money now, and you are screwed.

You might think that that scenario sounds a little silly, but it is a very common occurrence amongst startups. The way to avoid the pitfall of too much business is the same as everything else, plan your heart out. If you have a proper plan in place with regards to payments and orders, you can avoid these types of problems altogether.

A good idea would be to start small, make a commitment to not over commit yourself. If you’re starting a small business it might be a good idea to only accept cash, at least until you have a proper system in place. Don’t get tempted by the prospect of making thousands of dollars, it’s not worth the risk.

I can speak from personal experience, except that my experience went a little further. I started a computer business not too long ago. I was so excited by the first large order I received that I didn’t realize that the client had deposited a check into my account and not cash. I lost a lot of sleep over that check (I had already delivered the merchandise), and eventually I was slightly relieved when it was all over. That didn’t change the fact that the check was stolen and I had been scammed out of quite a bit of money.

All that to say, be very careful not to fall prey to too much business. Take a good hard look at every large order that comes your way, and don’t feel pressured into committing before you have analyzed it from every angle. Be wary of the guy that says he wants his stock right away, but is not willing to pay right away. Remember, if it’s too good to be true, it probably is a lie.

Simon

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I was listening to a CD the other day by a guy named Robert G. Allen where he uses a very interesting analogy. He says to imagine that your financial life is like a giant bathtub. When we turn on the faucet, it’s like getting a job. The problem with most people is that they turn the faucet on but they don’t realize that they haven’t plugged the drain, not only that, most bathtubs have many drains that are letting the hard earned money waste away.

What’s the normal mentality in this situation? Most people want to look for ways to turn on more faucets, or maybe they can make more money flow out of the faucet they have, so they try to get a raise or something. The problem with this mentality is that the drains are still unplugged, and if you’re not careful you could find yourself with more drains then you had before.

So what’s the solution? You have to do a bit of both. You have to look for more faucets to turn on, and you have to plug your drains.

As an entrepreneur you have to always be on the lookout for opportunities. They are everywhere, and when an opportunity comes your way, you have to be ready to identify it and turn on that faucet. But if you want to be a millionaire, you also have to think like one, and millionaires hate leaks. Take a good hard look at your monthly budget (if you don’t know how to do a budget, don’t worry I’ll be doing a post about it soon), see what you can cut out, and cut it out.

Turn on faucets, but don’t forget to plug those leaks.

Simon

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So you’ve started your new small business, you’ve worked out an effective plan and set some realistic goals. But, just like the online world, you need to find a way to generate traffic to your business, cause no matter how cool your idea is, if nobody sees it you won’t make any money.

Advertising doesn’t have to be as complicated or as expensive as it may sound. If you’re starting a new business on a tight budget, you might be pleasantly surprised to find out that there is a multitude of very effective ways to get your name out there without breaking your wallet.

Before you think about advertising at all, you have to make sure that you’ve done your homework properly. Its a good idea to do a bit of research in your target area to find out who your target market is. It’s not enough to just spray some fliers across town and hope that you’ll get some response. You might still get some business that way but it’s a huge waste of resources, and with a little planning you can be a lot more effective.

Here’s a small list that I’ve put together, from my experience and research on the internet, of advertising methods for the “tight budget entrepreneur”.

• Print and distribute some fliers – This is still one of the simplest and most effective methods available, but like I said, be wise in your distribution. Instead of just handing out fliers, it might be a better idea to put them in some key places. For example, whenever I print fliers for my entertainment business I try to leave them at places like toy shops, schools, or family restaurants.
• Print business cards – This one should actually be first. Business cards are not really a way that will generate a lot of customers right away, but if you’re a true entrepreneur you will always be looking for opportunities to network with people and if you don’t have a business card handy you’ll look very unprofessional.
• Car magnets – To me this makes a whole lot of sense. If you have a car it would be stupid not to use it for advertising.
• Launch your company properly – Make a bit of a splash out of the whole thing, and if you can afford it, give something away, people love freebies and they always seem to find the place where they can get some.
• T-shirts – This one’s fun. Make a bunch of t-shirts with your details on them and give them away. Maybe you could give a bunch away during your launch.
• Other promotional material – People always need things like bookmarks, calendars, and pens. It might be a good idea to invest in some odd promotional materials like these and give them out to potential clients.
• Door to door – Yep, its all about networking, get out there in the trenches and tell your prospects about your services.
• Offer incentives for word-of-mouth referrals – Network, network, network. Do whatever it takes to start the word-of-mouth ball rolling.

Hopefully this gets you thinking. It’s really not that hard to get some exposure on a limited budget, all it takes is a little thinking outside of the box. If you’re a true entrepreneur, this should be easy.

Simon

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What’s the first thing that you should do when you start a new venture? Set a goal. Without a goal your endeavors will be in vain. But it’s not enough to simply have a goal, now you need to achieve it. Sometimes our goals can seem a little unachievable, and that’s a good thing, I’ve always been a firm believer in shooting for the stars, chances are that you’ll hit the ceiling. But if do hit the stars, boy is it worth it.

There is quite a bit that can be learned from the life of a gold medalist in the Olympics. When he’s just born there is no way that he is going to win the gold, but he sets a goal to hold his head up, which he knows can be achieved. After that crawling becomes his focus and that to is conquered. Maybe he wants to stand, and eventually walk. Now, of course, he sets a goal to start running. Beating all the neighbor kids in races is a must, and eventually he’s training for the school championship. He’s constantly setting a goal to beat his previous best time, and for his persistence and efforts, he goes on to win it. He gets selected for the Olympic team, and although his dream is to win the gold, his goal is to continue beating his previous best time. We all know how it ends.

The moral of the story is that you climb mount Everest one small step at a time. Have a dream but set small, achievable goals and you’ll see that those stars can be reached.

You should always have a dream, because that is what will ultimately drive you to success. Then set some goals, but divide them up into

• Long term
• Medium term
• And short term

Personally, I think your long term goals should be what you feel can be accomplished in 5 years. Your medium term goals should fall under 1 year. And I don’t think you should make short term goals that can’t be reached within the month. If you do this you won’t feel like you’re always trying to reach something that can never be reached.

If my dream is to have the best blog on the planet, I don’t make that my goal, my goal is to write good content. If I want to have 10,000 feed subscribers, I don’t make that goal, my goal is to break 50. Or maybe I want to make 20,000 dollars per month online, but that’s not my goal, my goal is to make 50 dollars per month.

Do you get my point? Small goals fulfill big dreams, so keep setting goals, and don’t stop dreaming.

Simon

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