Rich Dad, Poor Dad: The First Book I Read That Got My Mind Tweaked…
Sometimes a book can really change your outlook and your perception of your opportunities. In 2002, I was working at Home Depot, assisting a friend in starting a painting company. Additionally, I was going to college full time. I had some extra time on my hands lol. I had also just bought my first rental property. During this time, I went to a multi-level marketing event. They were selling a website portal where you could purchase groceries online. This was well before the time of Amazon. The business model was to have each subscriber pay a monthly or yearly fee, like Costco or Sams Club. Consequently, the subscriber would have the ability to purchase items online for delivery like paper towels, soap and other household items.
One of the guys at the event gave me two books: Rich Dad, Poor Dad by Robert Kiyosaki and Cash Flow Quadrant by Robert Kiyosaki . Are you looking for a book that will help you take the LEAP? These are probably my top two books that tweaked my mind! Start your business today!
Cash Flow Quadrant: If You’ve Never Read It, You Must
The “quadrant” is broken up into 4 parts: E (employee), S (subcontractor), B (business owner) and I (investor). The premises behind the whole book is that if you’re an employee, you trade your time for money. A Subcontractor (meaning a trade job – Lawyer, Doctor, Painter, Carpenter, etc.) you’re trading your time for money, but there is no real way to scale this. For example, if you are a doctor and you don’t show up, you make no money, because you have no billable hours. At the time I was painting houses so it really resonated with me to say, “Hugo, the only way that you can make money, is if you show up and paint this guy’s living room”. That, I understood. It changed they way I started to think.
If you are a business owner you are still working in the business and on the business and have to be there to managed that process. But you can scale, grow and make more money.
As an investor, you are looking for passive income opportunities. Such as real estate, where you can make the purchase once, and the amount of money you make is disproportional to your time spent. For example, if it takes you an hour a month to manage the property, and you are making $200-300 per month in passive income, your income is disproportionate to the amount of time spent on that property. If you purchase stock in a company and get a dividend and do no work, you are making more income with less effort. Both of these can be scaled.
Rich Dad, Poor Dad: New Ideas That Inspire Entrepreneurs
The second book, Rich Dad, Poor Dad, is about the author as a boy. He watched two dads (friend of the family and biological dad) work their whole lives. His own father was a school teacher and worked every day. His friend’s father was an investor. He saw how much wealthier this friend’s dad got. As a result, he started to work less and less.
I have always remembered this. How can you think bigger. Think outside the box and look for new opportunities. For instance, with a SaaS (software as a service business) you probably spend a ton of money and a ton of time marketing it, growing it, and getting businesses to sign up for a monthly service fee. Furthermore, once you build it and build the client base, you are charging everyone throughout the month for the service. As a result, if you need to have Monday off, you can take Monday off and the world still turns and you still get paid. It is a great business model. BUT it does take a lot of work and time to get it to that point. (As a side note if you are interested in building your own SaaS platform, I am happy to advise you, click here)
Right now, I am back to being an employee, a business owner and an investor. I get most of my income from “E” quadrant but my goal is to start and grow more businesses so that more of my income comes from the “B” quadrant so that I can invest more money and time in the “I” quadrant.
You can fit yourself in many different groups. I see the goal as getting to a place where you have enough passive income to be solely in the “Investor” category.
Both of those books helped me see that there was more to life than just a job for 35 years. These books helped me take risks and explore new opportunities.