Chapter 18: Education versus Academics

In my first year of studies, I was told a shocking statistic.

90% of business owners do not hold tertiary qualifications.

I was studying to skill up and hearing that my chosen path doesn’t align with where I wanted to be made me question the education system.

The longer I studied, the more I learnt of other peoples experience. Each time, I had no experience to relate too. 

I wanted to learn through my own experience. 

I was raring to go and get out there.

In an industrial psychology lesson, I remember a being told this story:

A man goes out and starts his own business. He gets married and has kids. He provides financially for his family and pays for their livelihood.

He insists that his kids do better than he did. That they get degrees to have a better life than he did.

His kids get qualified.

With their qualifications, they start trying to help their Dads business. They address the risk factors that he had not considered. 

Over time though, they were so risk-aware that the business lost sales momentum. The business landed going bust.

I have many friends who have achieved their MBA. Masters of Business Administration.

They make poor business owners. Not one of my friends with MBA’s has self-employment acumen that impresses me. They are all really good at growing someone’s business but not their own.

They can see opportunities but they follow through in independence lags.

I believe MBAs qualification kill the entrepreneurship spirit.

Another observation I have is my best man Kennaird.

In our final year of school, he left in the first term, to go overseas. He didn’t finish school.

I worried about his future. Thought imminent failure was on the cards.

Needless to say that he was the first person in our year to make a million Rand. He was the first person to pay off their first home. 

He became a skilled carpenter and reinvested his income in a property (and developments). 

He proved that the education system is a delay in personal growth. He proved that you don’t need qualifications to be financially successful.

My conclusion is that we are all responsible for educating ourselves. We can learn a lot through academia but is it relevant and empowering to our path or is it a distraction?

I lean more towards learning through my own experience.

Be encouraged. Don’t stop learning.

Chapter 17: Skills Are Needed

I remember it clear as day, finishing high school and knowing I wanted to be my own boss. 

Whilst chasing tertiary education, I wanted to start a side business and earn cash.

My friend and his Dad were repairing commercial printers on the side and they asked me if I would like to help them get more business.

We came up with a business name, a logo, we created an office in his garage and got business cards printed. 

Got out local telecommunications provider to set up a dedicated landline.

We had the infrastructure that local businesses need to operate.

The phones didn’t ring.

We were encouraged to cold call and drop off business cards at prospective businesses.

I didn’t have the business acumen or experience to handle myself in the business world. I didn’t know business etiquette or minimum expectation for professional conduct.

I didn’t know enough. I didn’t have enough experience to be able to be my own boss (yet).

When it comes to product knowledge, I didn’t understand our limitations. I didn’t know the boundaries of our limitations.

Without thorough understanding or having the skillset myself, I didn’t have confidence in my product. Without product confidence, my selling abilities were dismissal.

Years later, I entered the workforce as a sales consultant. First on a commission basis only and then progressed to the security of salary employment.

Both sets of employment had different product offerings. I had to learn about each one’s value proposition. In knowing my product thoroughly, I could sell easily.

I learnt business etiquette. I worked on my grammar and professional presentation. I learnt how the business world works. I then understood how things are done.

I skilled up and understood what it takes.

Getting the experience of client dealings is crucial.

This is where I have had to learn, I need certain skills before I step out.

If you find a product or service you are passionate about, it’s a start.

You need to have strong product knowledge. Know the insides and outs of how it works and more importantly why customers would want it.

You need to then have the ability to handle the product on a professional level (if you want to go big). 

I didn’t have the skills or abilities to handle business operations (first time around). 

I learnt that I needed to know more and that having the basics of business infrastructure alone is not enough to bring business in (and get that phone ringing).

Chapter 16: Annual Perspective

A huge shift in mindset is quantifying operations. 

  • What do I mean by this? 
  • How do you measure your businesses progress?

When business owners talk to other business owners, they talk about gross turnover. 

More importantly, they talk about the years’ performance. 

Entrepreneurs measure costs and performance in a year. This year versus that year. This year the cost of staff versus the past year cost of staff.

It’s a common standard that helps business owners talk on the same scale.

My business generates R16M gross turnover in the last financial year and my brother in laws business generates R150M gross turnover in the same period.

The purpose of the chapter is to show readers that they need to see their company’s income and expenses for the year.

Hence a yearly perspective is needed.

How much is rent for the year? How much income could I budget for in the year? Will the income exceed the costs of operation?

Chapter 15: CMA – Competitive Market Analysis

The content is slowly gearing up to starting a business. 

Once you have identified a model that works for you, the next important step is CMA.

From my experience, every time I identify a business model that interests me, I google search the business I want to start.

I find it’s the best way to see who other service providers are (exist and are operating in that field) and what the competition is like.

  • Are they doing a good job?
  • Could I do it better?
  • Has this been done before or do I have a new market?

Often, I find myself getting carried away with business development ideas without doing CMA first.

Doing a CMA is often a sobering experience.

It is vital though for new business success.

Delaying or avoiding it is grounds for unnecessary setbacks.

If the market is saturated, it will be harder for your site to rise to the top. If there are no other quality or dedicated service providers, the opportunity has a greater chance of success.

Chapter 14: Observe Business Models

There are so many opportunities. So many ways to approach the self-employment model.

Using observation, you need to identify what works for you.

I am personally chasing after passive income streams.

This means I want to live in a world where I make money while doing nothing.

That’s the reality I want to live in. That’s the world I want to create.

Yes, I need to invest upfront but once invested, I can sit back and get remunerated. Set up a system where I get paid a monthly income (not based on hours worked).

Observing business models is important for this task. Weigh up different approaches and markets is key in determining which path to follow.

Traditional examples:

  • Convenient retail
  • Product creators 
  • Service providers
  • Selling advertising space
  • Property investors and portfolio managers 
  • Property developer 
  • Renting out of assets
  • Investing in shares and unit trusts.

What are business models that can generate income that you can come up with?

Chapter 13: Money From Nothing

In a world of unlimited opportunities, making a profit is so easy and exciting.

To me, the beauty of the profit model is that you can literally make a profit out of nothing.

Before I tell you of how I have made money from nothing, I first need to tell you are the basics of the profit model.

If you go to your local convenient store or grocery store or cafe and buy any product, take that product and sell it for more than you bought it for, you have made a profit.

Why would someone buy your product at a higher price?

Many variables can help enable this:

  • Convenience 
  • Presentation 
  • User experience 
  • Accessibility 
  • Exposure 

These variables that entrepreneur have at their disposal. If a product is made conveniently available, the price doesn’t play a factor. 

For example, bottled water. 

You can buy the water for “x” from your local store.

You can take that bottle of water, and sell it in the desert. Someone dying of thirst would be willing to pay anything for that bottle. They wouldn’t worry about where you got it or at what price. Their needs would bypass that consideration.

The convenience adds value to the product. Paying more makes sense.

The basics of the profit model though are simple. Buy a product and sell it for more than you bought it for.

Easy.

I stand before you though as a person who made money from nothing.

On the 30th of June 2010, nothing existed. Nothing had been built. Nothing was being sold. Not a thing. Not this thing.

The next day, I registered a website and built a site. I got a logo designed and make documents. Registration forms and set up email accounts.

It took some time but I slowly got website ranking to climb and business deals coming through the door frequently.

Today, I have a team of staff that deals with clients, thanks to my website and forms.

I created a business from nothing. I make money from nothing. Nothing was there before. Now, where nothing was, is my company and my company generates income. 

I am proof that it is possible to make something from nothing. To make money from nothing.

Endless opportunities exist.

Chapter 12: Making Money Is Easy

By now you can see I have referenced some commonly heard of sayings or philosophies. 

A saying I came across is that:

Making money is easy“.

Hey!?! What?

If it is easy, then I want to quickly make some.

What the author was actually saying was:

John McAffee makes the bold statement that has shaken me to the core (from a young age).

Making money is easy.

In life, you sometimes have to go down the path before you can relate to what the author was saying.

Now that I have built up a successful business, I know know know what the author was saying.

I was guilty of focusing on the first part of the discussion. Making money is easy. How does that work?

Only once you have built up your own business and generated income from your business can understand that making money is easy. 

Keeping money is challenging.

Having gone down this path, I believe the full statement should look like this:

Making money is easy. It is easy once you have worked hard to develop a business that works well in meeting clients needs.

The difficult part now, once your business is operational and generating a constant income, is working out how to keep funds in the business.

It is not as easy as it sounds.

Chapter 11: Continual Improvement

The mind shift continues to go deeper into this chapter.

Using observation as a tool for improvement, identifying systems that exist and knowing that there are endless opportunities, this next chapter really drives forward motion.

A challenging thought that I practically ask every day is: “how can things get done better?

How would I do that better? If I was the owner of that company, I would do things this way.

Identify, plan, execute and review.

Continuous improvement process (abbreviated as CIP or CI), is an ongoing effort to improve products, services, or processes. These efforts can seek “incremental” improvement over time or “breakthrough” improvement all at once.

In my business, things started to get busy (2 years in) and I needed support. My wife quit her job and joined forces.

She wasn’t my first employee but she was my greatest team member.

Anyway, in joining me, she learnt key entrepreneur skillset. 

There is no perfect start.

Once my wife had settled into understanding my business offerings, I got her to help diversify the company offerings by setting up a new service.

We had never done it before. 

It was interesting to see her concerns.

We don’t know how to do it? What if the client finds out? What if the client asks a question that we don’t know how to answer? What happens if we get it wrong?

This is a natural place I call: “fear of the unknown“.

Trial and error will teach us. We learn through experience. We gain expertise through experience.

We learnt together. We learnt quickly.

Later down the road, my wife started testing new services. Without me know or ask.

She learnt to conquer the fear of the unknown. She now takes steps in her own business. Creating products and testing responses in the market.

Don’t let that fear hold you back. Using Continual improvement enables you to learn and make things work. Better.

Chapter 10: Ultra Rich Think Differently

I have drawn this conclusion based on my observations of the super-rich.

This chapter has the purpose of asking you to question your wants.

  • What do you want?
  • Why do you want it?
  • What do the rich want?
  • Why do they want it?

The basics of economics teach us about supply and demand. It is balanced over price and quantity.

Where supply meets demand is known as equilibrium. Equilibrium is the point where price and quantity will match the demand and supply of products at the right point.

If there is a higher demand than supply, the price will increase. If there is a higher supply than demand, the price will drop.

That’s the basics of economics.

If we take this economic principle and we add psychology consideration, we can draw new conclusions.

Psychology has helped us realize that we want what we cant have.

A fundamental truth in human nature.

The easier things are to obtain, the less desirable they become.

This works in relationships as well as physical possessions.

Economics studies peoples demand products and psychology studies why we demand products.

New rich tend to buy fancy sports cars where old rich don’t. Just because they can afford it doesn’t mean that they will buy it.

New rich tend to be flashier because they previously experienced a lack of access to finances to afford these goods. Where old rich have always had access to funds, they never felt that they couldn’t afford it, so they never felt the demand for it.

The super-rich (old rich) don’t wear branded clothing or drive fancy sports cars. They dress well but not branded. 

Their demands are different. 

This perspective will hopefully get you to think about your desires and wants. 

If you were super-rich, would you still want it?

If you know you could afford it or if you bought it, would your desires be met?

If you were super-rich, what would you want?

Reverse Psychology

Have you ever bought something you always wanted, and once you had it the excitement of getting it had gone.

As if once you took ownership, your desire ends.

This is what new rich often chase after. All the things they once thought they couldn’t have.

Once they buy all their primary desires, the excitement goes.

New rich then tend to chase after the next exciting purchase (and buy bigger).

Old rich/ wise rich focus on growing wealth rather than finding ways to spend it.

To learn from the super-rich, I recommend thinking about the transactions backwards.

If you owned it, what would you do with it? How often would you use it? Would it really be used often? Where would you store it?

The superrich doesn’t buy unnecessarily. It adds chaos to their lives. They like simplicity.

Chapter 9: Self Educate

You are the gatekeeper of your mind. You control what sticks and what gets tossed out.

No one else can teach you.

There is an old saying: “you can lead the horse to the water but you can’t force the horse to drink”.

You are the horse. You can be stubborn and not learn what is good for you. You need to take responsibility for your thoughts. 

You need to be open to learning more.

The way I look at the world, there are 3 types of education.

  • Survivalist
  • Institutional learning
  • Self-awareness

Survival learning, we learn not to touch what is hot. How to swim. How to crawl, walk and run.

We learn balance and spacial awareness.

We learn how to cross the road, who to trust. Where to find food, shelter and support.

We start off in this world learning how to survive.

Over the years, the man realized that they can pass down skills to the next generation through schooling. Reading and writing were fundamental in doing so.

Then academics got involved. Over the years, an institution of education was built. Its objective shows a way of thinking. Much like this book.

Science teaches observation through cause and effect. A way to draw conclusions through reactions of events.

If “this” interacts with “that” and a reaction occurs, why does it happen? What is the lesson we can draw from that reaction?

Math teaches us that we can solve problems and ultimately predict results.

We can solve angles and measurements. We can time events in the future and we can calculate complex equations.

English teaches us professional conduct.

Art teaches us expression. It teaches us to look at our reaction and assess what emotions are evoked. To me, good art (be it a physical display or musical performance) draws on a unique past emotion we have experienced. 

I personally chase after positive experiences in art. Uplifting, peaceful, inspiring. Art that brings hope or happiness.

The complication of institutional education is that you are not taught how to succeed.

You are not taught how to be successful.

Rather you are only taught how to professionals solve certain problems and you are tested on your ability to mimic someone else’s approach to solving a problem.

Don’t get me wrong, there is value in learning problem-solving techniques. The problem is the application.

How often do we apply maths in solving our day to day problems?

Self-awareness is what we learn outside of school. Professional interpersonal conduct and application of educations theory in the workplace. What you have learnt in school applied in the workplace.

It shouldn’t stop there. Learning should never stop.

In a world of unlimited opportunities, where failure doesn’t exist, we should be continually testing things and teach our self new skills. Trying new things.

Searching for more things that we like. More things that we are good at. More things that we enjoy doing. More things that we can do, better.

We should be chasing after a full experience of life. To go out and see as much as we can. To go out and taste as much as we can. To go out and see the world around us.

To me, that is living. That is the purpose of life. 

Being open to trying new things.