10 Principles I Learned From a Self-Made Multi-Millionaire

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10 Principles I Learned From a Self-Made Multi-Millionaire post image

If you are rich, sexy, funny, powerful, good at the guitar, a great writer, a fast talker, a fun times maker– and I know many of you are– I am taking notes.

Below you’ll find 10 princples I penned after spending a lot of time with a my friend Keith. He started from zero– nada– and built an empire. I’m confident that if he started all over from zero, he could build it again. A lot of people get lucky, I suppose, but after meeting guys like Keith, its hard to believe luck has everything to do with it.

Even though he’s amassed a fortune of close to 10 million bucks, he doesn’t think his advice is all that useful to the world. He cites that fundamental insecurity about his success as part of the reason he’s achieved it in the first place. (Unfortunately for us, I think that means no blog :()

If I were to pull out one point that is important, but beyond the scope of this post it’s this: wealthy people think about money much differently than almost everyone I’ve been surrounded with my entire life. If you care about amassing wealth, and you grew up around un-wealthy people, re-education is critical.

It’s also important to decide what wealthy is to you. You can live like a millionaire without a million bucks– I’ve tested that one out first hand. I’m not for the blind pursuit of money. If you step back and define your financial goals in painful detail, half the battle is won. <– nobody does this. What’s up with that?

Let’s get started…

  1. DO NOT SPEND YOUR MONEY. Keith keeps jamming this one in to my head. “Dan, when you get that first chunk of cash, DO. NOT. SPEND. IT.” Some corollaries: don’t buy super nice crap, don’t get a huge mortgage (if you must, 20% down, 15 year term shout to Dave Ramsey), don’t get a car loan. Speaking of Dave Ramsey, he’s got this great quote: “live like no one else so you can live like no one else.” Perfect. Cash is your runway, cash is your security, cash is your in to lucrative deals and businesses, and cash is your opportunity. Earn it and protect it above all else.
  2. Find games to play, not roads to take. Think of roads like established paths to success. “Just go to grad school and then get the right job and then … ” Most people are looking for roads to take. College. Grad School. Credentials. Dues to pay. Rules to follow. Keith prefers to hack his way to results. What’s the most effective way to create the result he is seeking? Seeking out established credential systems is a form of permission asking, which is something this blog doesn’t support. It’s also a bad policy if you want to have some serious fun.
  3. Learn fast. Learn well. Keith is a world leading expert in the businesses he operates. Since Keith has serious chips in the game, he evaluates all information that comes his way. He doesn’t take the time to figure out if its reputable, cool, trendy, or whatnot. If you’ve got info, he’ll hear you.
  4. Have an incredible focus on the details (and don’t be sloppy). It’s impossible to know every detail in every organization. What I’ve noticed with guys like Keith is they don’t show up to a meeting about the accounting procedure and say “whatever.” If they are taking the time to be there they’ll dig in to every detail.
  5. Making money from business is easier than making money from money. You hear this advice from a lot of balla ballas like Mark Cuban. The stock market is, in general, not a good place for you to make money. You’ve heard it– if your portfolio manager knew how to make money he wouldn’t be a portfolio manager. I can understand the allure of dumping your cash in to stocks. Fair enough. If you know something I don’t know, go for it.
  6. Have no fear of confrontation. This is one I’m particularly bad at. Keith will immediately confront issues and people who stand in his way. He’s not a jerk about it– but he’s intense and won’t stand for people screwing up his vision. I’m still working this one out, but one of the traits I’d like to develop in the coming years is an effective and positive way to confront people immediately when I sense a problem.
  7. Proatively seek critical feedback. People don’t like to give critical feedback directly to you. At least not good critical feedback. Sure, people love to talk shit about 3rd parties, but when is the last time somebody sat you down and gave you good advice on how to improve? Keith is excellent at soliciting this type of feedback from many of the people in his immediate business and social network.
  8. Work all day long, and demand that everyone else do so as well. Wake up early, work all day long. This attitude takes an incredible kind of energy that I find exhausting. I’m not hot on riding people, but my millionaire friend thrives on it. He will push you until you break. It reminds me a lot of way Jason Calicanis talks about his staff. Especially for his top assistants, anything short of 100% effort and responsiveness is not acceptable.
  9. Everything is for sale. Most people are super attached to their stuff. It’s not that big of a deal. Keith once sold his dream home (for a healthy profit), he couldn’t turn away from the huge offer. Everybody moaned about it for a month or so until he found a nicer place, and a better deal, and promptly moved in.
  10. Take 100% responsibility for your finances. Don’t trust your accountant. Don’t trust your portfolio manager. Don’t trust the IRS. As a business person, this is your primary domain of responsibility. Like it or not.

One final thing: there is this inhereted wisdom, “you won’t get rich working for somebody else.” Not true. Keith has made more than one person rich as well. Wouldn’t that be fun?

Back to work :D Hope you are having a great day.

Cheers,

Dan

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Published on 02.07.11
  • http://twitter.com/AlanPerlman Alan Perlman

    Sounds like an interesting guy. Would you mind elaborating on point 2? Do you equate “playing a game” to staying flexible, and “taking a road” to limiting yourself by staying on one path? Makes sense, but I just want to make sure I’m getting that right!

  • http://www.tropicalmba.com Dan

    I think I articulated that really poorly, I should probably fix it. When I think of “roads” I think primarily of tracks, like grad schools who give you a certain certification then you are lined up to do the next thing etc. I’m trying to expressing the difference between following established rules and hacking together results on your own.

  • http://reeceschofield.com Reece

    Great Post, Dan.

    I’m also pretty guilty of avoiding confrontation, but it’s a role that I’m increasing finding myself in. I’ve found that exercising #7 – seeking out constructive criticism early and often – makes issues that require confrontation very minuscule and painless (in regards to dealing with clients and customers)

  • http://www.tropicalmba.com Dan

    Thanks Reece. Confrontation is probably the most difficult thing here. Doing it well can have huge upside, but its super tough. Also on the critical feedback part, I’m becoming more and more interested in “blind spots.” You know those things all your friends know about you but you don’t know about yourself? I’m trying to figure that one out :D

  • http://neti-pot.co Richard Riley

    Definitely one of my favorite posts on this blog. I especially like, “…that fundamental insecurity about his success [is] part of the reason he’s achieved it in the first place.” I think we all fear failing with our businesses and I know that, atleast for me, facing that fear and going for it anyway is one of the hardest things to do. Awesome post!

  • http://www.tropicalmba.com Dan

    Thanks Richard appreciate you stopping by. Fear fear fear its everywhere, I think doing business at a high level is definitely about confronting it regularly.

  • rafunzelle

    “Do not spend your money”- a very good advice Dan This really got me.

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  • http://www.lifenthusiast.com Tony Kwan

    Love it – “Live like no one else so you can live like no one else”. Every story of deca-millionaires and billionaires I’ve heard run with the central theme of living well below your means. Absolutely crucial in the beginning stages of a business, even a lifestyle business. I am not a good penny pincher so I found a “stingy” partner who oversees my business spending. As a budding entrepreneur, it is incredibly easy to fall into the trap of thinking you need more than you actually do.

    Tony

  • http://www.tropicalmba.com Dan

    Its true how amazingly different this advice is to what is sort of the general perception seems to be.. I was sort of shocked at my first business mentors old shoes and car, he was like focused on the bottom line, and in my case, I’m really lucky to have a guy like @AnythingIan around who keeps my taste for the good life in check :D

  • http://twitter.com/NickBerggreen Nick Berggreen

    Have no fear of confrontation. <– Is the best one. People will walk all over you if they think they can, because they can.

    Stand up for yourself in every matter that matters to you.

  • http://www.tropicalmba.com Dan

    Word :D

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  • AJ

    Great read Dan. Thanks!

  • http://www.tropicalmba.com/ Dan

    Cheers!

  • http://www.superfastbusiness.com/ James Schramko

    details. Important.

  • http://www.tropicalmba.com/ Dan

    :)

  • http://www.superfastbusiness.com/ James Schramko

    I also like the confrontation point

  • Matthew Newton

    Love this

    “Keith is excellent at soliciting this type of feedback from many of the people in his immediate business and social network.”

    I see this post was a while ago but would have loved to have heard more on this point.

  • http://www.tropicalmba.com/ Dan

    cheers Matt… i was always impressed at how good he was at getting others to talk and dish the goods… didn’t matter if you were on day 1 or a seasoned vet he wanted to hear your thoughts. very cool.

  • JeremyFrandsen

    Great post man! I love the message of #10 especially.

  • http://internetbusinessmastery.com/ Jason Van Orden

    I need point 6. I’m bad using confrontation when needed. It’s a co-dependency issue really. That’s something I’m committed to working on. Thanks for sharing this inspiring and insightful list.

  • http://stevepohlit.com/ Steve Pohlit

    There is a lot of wisdom in those 10 principles. I don’t approach business that exact way although I once did. The process that I use for my business and as well as coach people to implement actually includes specific action steps depending on the condition The condition can be overall business performance or an individual job or function. With the right data the condition is identified and there is a precise formula depending on the condition. It is not a robotic process – not at all However I have learned that if you follow the processes you cannot fail. I have found this to be absolutely true. What the processes do is take the emotion out of confront and hold each clearly defined position accountable for performance and showing they are achieving agreed upon milestones or not. It is simply amazing and for the first time in my career. I am shouting – results guaranteed. I have said it and I have written it is good faith, now I know with certainty. A very nice place to be.

  • http://stevepohlit.com/ Steve Pohlit

    There is no reason for there to be any blind spots.Dan.

  • ioan pongrat

    Yes , very interesting comment Mr Dan Kennedy .. what can say i .. ok forgive please , all the best – Romania

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