Sunday, 18 December 2011

Get Rich the Hard Way

Recently I have noticed a boom in get rich gurus. Many of them without a particularly strong track record in business or an obvious skill. They are rich because you and I pay money for their books and courses, because I watch their DVDs and you play their board games. It is fair to say that I am quite sceptical of why closing my eyes, standing on one leg and screaming "I am a money making machine" would put any cash in my bank account. But that certainly doesn't mean I am against a positive attitude and sensible financial planning.

Guy Kawasaki, one of the original and most prominent wealth gurus, preaches a particular brand of money management which can essentially be boiled down to spend less money than you make and invest the surplus cash in revenue generating assets such as investment properties. I've read Rich Dad Poor Dad a long time ago and the advice is pretty sound, just don't believe it will turn you into the next Kawasaki.

Extreme prudence is not the path I have chosen. Rather than worrying too much about what I spend, I worry about what I make. There are two factors in Kawasaki's equation, what you make and what you spend. Kawasaki focus mostly on expenditure as the variable, I focus mostly on income as the variable. WHY? Because I didn't give myself much of a choice.

I have always had an unwavering belief in myself and when I was a student, I saw borrowing to pay for my lifestyle as merely a way to to redistribute some of my life earnings, and when I inevitably used more loans to continue my lifestyle after finishing school and more loans to start my first business, I wasn't worried at all. AND THEN I WOKE UP.

My first business adventure turned out to be a fairly spectacular failure and as there was no more money left to borrow, I had to get myself a job. So I did get a job, a normal reasonably good graduate position in a big brand bank. My problem was that I couldn't afford to stay there, a normal graduate salary wouldn't allow me to even service my debt. I studied the job boards and discovered that the higher salaries were to be found in hybrid roles. For me, at that time, in the country I had ended up in, the big money would be in designing IT systems for banks, not just banking, not just IT but in the area in between. I thought yes, I know something about banking and yes I know IT, but how could I convince people I could glue it together, I needed a framework, so I bought a book about IT business analysis (I remember I thought of it as a big investment at the time), internalised it to the point where I could present all the tools as my own. When I finally got a chance to interview (after many many applications) with a company and the COO asked me the question "whats your methodology" I explained in great detail all the models and techniques "I use". I got the job. Once I had the job I needed to work twice as hard to keep it, because losing it would be an impossible scenario (in a county where I wasn't eligible for any income support), and I think this obsessive need to succeed was why only a year later, I was made head of products and analysis, leading people with 10 - 15 years more experience than me. Over the first year I tripled my income and carved out a niche for myself that I'm still benefiting from today. Looking back, being broke and without a safety net was probably what I personally needed to rid myself of my biggest demon, my own laziness and complacency. After that, I worked very hard to avoid ending up in that situation ever again. The failure of my business was my formative experience; easily both the worst and best thing that has happened to me professionally.

So do I advocate this hazardous approach? I certainly don't recommend borrowing too much, now that I have paid my loans back and am debt-free I am much less stressed and I don't ever use credit cards anymore. What I do advocate is setting yourself ambitious goals, if you know you can do it, don't be upset that other people initially don't share your optimism, you just have to demonstrate it. The only question is whether you prepared to work really hard, because what I am talking about is not a 9-17 job. You can substitute experience with effort if you are willing to pay the price, you are the one who has to stay up all night to study what the other people already know, so you are the best prepared at next days meeting (whoever is better prepared tend to get what they want), day after day, for years, but one day you will become an expert in your chosen field and when you are in the top 5% (which I would argue is a credible goal for everyone of normal intelligence) you can ask for a very good salary.

I have seen, and interviewed, many graduates who seem to expect to be taken care of. After graduating, they expect somebody to give them a job, expect their employer to tell them what to do, expect to be given a career plan. There are so many great opportunities in the world, but it is your own responsibility to seek them out. Look at yourself honestly, what is it you want to do, are there any gaps between your skills and the requirements of the job. Find out how you plan to bridge those gaps and present a credible plan to an employer. If they think you will add value, they will pay you. If you can add a lot of value, you can ask for a lot of pay.


  1. I was self employed...but the way to win cases is to prepare thoroughly, home in on the points that matter and research intelligently.
    And when a chance comes along to take on something in another it did when the U.K. joined the have the tools to take it on.
    I loved the early years of European Law in the U.K....most judges didn't have a clue, and were likely to take the opinion of the Advocate General as law because he was British!
    Lots of fun!
    And as for Competition was at the level of elasticity of demand as described in Economics 'A' Level...

  2. @thefly: Research and preparation? Surely you mean money exercises :) I wanted to embed a youtube video with people doing the “millionaire mind wealth conditioning program” but I feel quite sorry for them.

    Your story demonstrates how it really works. Acquire a skill that is in demand, go where the work is, take what you can while you can and remember to always plan the next step, because nothing lasts forever.

    And have lots of fun.

  3. @thefly: btw funny you should mention Competition Law.I had a long debate yesterday with our counsel about the enforceability of non-compete clauses. 

  4. Hey, I know someone who is starting global financial startup! he is an IT person as well. I think you both should meet or work together. If interested, shoot me an email

  5. @thefly: not a problem. Believe it or not, most people I work with are supposed to be retired.

  6. @Rania: Thanks very much for the offer. What would your friend need me for? Do they have funding? Already up to my tits in startups so I hope it's okay I'll contact you in the new year? I'm currently working on something that require a high degree of discretion, and I hope you understand I therefore don't post all my details online.