How to become rich....

[xxThe_Lebowskixx]

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Plastics

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I missed this the first few times I opened this thread. I wasn't crazy about the movie, but I loved that line! Great post.

[thehun69]

Interesting thread...

Three ways to get rich:

1)Investments - real estate, stocks, commodities, other companies, etc etc etc

2)Entrepreneurship - start your own business and no, it doesn't have to be high tech, there are tons of examples of billionaires starting regular nontech companies

3)Here is a nice longshot, hump a job long enough to work all the way up the ladder to CEO.

Lots of great points here. A good book that sheds light on the superwealthy is How to Be a Billionaire link (I don't know how to post it without that massive link, if someone can do that, that would be great)


The book profiles alot of the principles used in how the superwealthy became that way..and I mean the superwealthy, not your average $400,000 a year Wall Street stiff I'm talking about liquid. Rich enough to have your own jet. Rich enough not to waste time. Fifty, a hundred million dollars, buddy. A player. Or nothing. Most of the people that were profiled didn't have money on their mind as their motivation, that's not how it started, money keept the score, but that's not why they played. It gets back to that doing what you love, or are intereseted in, or challenged by, and the money really does follow.

Here are some of the principles:

Martin starts out with several fundamental strategies:
* Take Monumental Risk
* Do Business in a New Way
* Dominate your Market
* Consolidate an Industry
* Buy Low
* Thrive on Deals (my favorite)
* Out-manage the Competition
* Invest in Political Influence
* Resist the Unions

And key principals:


 Pursue the Money in Ideas
 Rules are Breakable
 Copying Pays Better Than Innovating
 Keep on Growing
 Hold on to Your Equity
 Hard Work is Essential
 Use Financial Leverage
 Keep the Back Door Open
 Make Mistakes, Then Learn from Them
 Frugality Pays
 Enjoy the Pursuit
 Develop a Thick Skin



It was stated before and I'll state it again, if you don't love or even like what you do, you will never be rich, no matter what.


THE HUN.

ED: fixed link

[Evan]

Here's an interesting passage I just read, written by Ben Horowitz, CEO of Opsware Inc.

To find that out, we have to examine what motivates CEOs in general. Is it pure greed -- the burning desire to have more money than Bill Gates?
Surprisingly (at least for anyone who watches TV or movies made in Hollywood), the answer is: not necessarily.

What motivates most CEOs -- not all, but most -- is some combination of winning and, as a result, building something great. Building a great institution, a great place to work, a great place to do business with, and a great investment. This is what's most motivating and what's most gratifying. And what they'll fight to hold on to most dearly.

Of course that doesn't prove or disprove anything. It's just one guy's opinion.

If you want to read the rest of the post (which mostly has nothing to do with this thread but is pretty interesting) it's here: http://blog.pmarca.com/2007/06/ceo-crime-punis.html

[Tien]

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nothing gets me going more than the "people don't realize how big of a factor luck is in X."

first of all, a lot of people do realize how big of a factor luck is. luck is a factor in everything, business, sports, getting hot chicks, whatever. what the "naysayers" forget is that a certain type of person consistently puts himself in the position to get lucky. starting any business requires some luck, but i would assume 90% of people don't have the motivation, risk tolerance, intelligence, etc. to even ever try to start a business. to punish the people that actually go out there and start something, do it well, get lucky, and get rich by attributing more than a very small percentage of their success to luck just drives me crazy.

the way i've always looked at luck/success/riches is that somebody is going to do it, it might as well be me. i'm going to consistently put myself in situations where i have the chance to get lucky in order to achieve my goals of being filthy rich someday. that's really my only plan and i'm going to stick to it.

also, i do agree that money is just a way to keep score. i don't want to get rich to change the world, although of course when i get rich i want to make sure i help a lot of people.

i've thought about this a lot in my life and i honestly think you have to have somewhat of an unhealthy obsession with wealth in order to become insanely rich. i care about being rich more than just about anyone i've ever met. i don't really know why, i think it's just that i am so competitive and money seems like a good way to keep score. i realize it's sort of ridiculous but i really can't help it.

tc

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Quoted for mother [censored] truth.

I felt like those words came right out of my mouth.

I feel exactly the way you do down to every single word in your post.

Hoorah for Hardcore Capitalists!

[Tien]

It's not rediculous to want to be filthy [censored] rich.


Only poor people ever say it's a bad thing to have so much ambition for success / money. Filthy rich people never say such rediculous things.

[Subfallen]

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Plastics

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I missed this the first few times I opened this thread. I wasn't crazy about the movie, but I loved that line! Great post.

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QFT, Graduate pretty much bored me to tears. Midnight Cowboy is 10x better, and wtf you never hear about Hoffman in that film, and nobody watches it.

[Jeff W]

Note to Mod: Please fix long link in TheHun's post--it breaks the forum width.

[Scorpion Man]

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I think I would appreciate it more if you power hitters answered more of OPs original question rather than these tangents. Is it more important in achieving wealth to love something and dedicate yourself to it, or dedicate yourself to the pursuit of "getting rich?"

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This is pretty simple. Starting your own (non financially oriented) business (if it's real...not a dry cleaner, but something that has a shot at getting scale and going public or being acquired) is the best way to get really rich (let's say $100m+). But it has massive variance, and many very good and very (and I mean absolute top of the heap) people will fail at this.

Working in the finance business has much much less variance and gives very good probability (if you are skilled and pedigreed) of finishing with at least $10m, with reasonable probabilities of multiples of that.

By the way, best possible route of combining variance and the general upside of finance oriented businesses? Start a finance oriented business! It costs little to start a hedge fund and you have a reasonable shot at real money. That said, this is only true if you have a certain kind of background and skillset.


FWIW, I will take the guy who is desperate to get rich (that was me) over the guy who just loves his product any day of the week, although the product loving guys will show up once in awhile as huge winners. The variance is just way too big. That is why venture capital is so much better than entrepreneurship. Entrepreneurs have a portfolio of one. Look that one up in your finance theory books.

[Arnfinn Madsen]

One good thing to keep in mind is that to become rich you need to build a brand (doesn't have to be a consumer brand). So any kind of idea where you are franchising for McDonald's or you base your success on selling Sony TVs will never make you rich. Your brand needs to be so strong that it is what determines where the customer buys, the customer may go to one of your stores and end up buying a Sony TV, but if he comes to your store looking for a Sony TV you will never get rich.

A few aquaintances of mine just started a franchise. So why didn't they start a new brand given what I wrote above? Well, my guess is that they lacked confidence in their ability to market and/or sell the product without a strong brand. I think that 95%+ of entrepeneurs never will become rich due to lacking ability or confidence in this regard.

So basically you are forced to either learn marketing (for low value mass sale products) or learn how to sell (for high value niche products) or a combination of those.

To conceptualize and use Cardrunners as an example, on Cardrunners it says: "Videos - Online poker Videos from the pros", it doesn't say "Phil Ivey-videos here", they don't cop out by hiding behind an established brand, they go ahead and build their own. You go to Cardrunners to find videos, then you click on one of the Aba-videos, you don't go there to find the Aba-video, because if that would be the case Aba would start a site tomorrow called abapokervids.com, and Taylor would never get anywhere.

[MagicNinja]

IMO the key to making lots of money in life is just like in poker, el diablo alluded to it earlier;

objectively look at a situation and make the best money making decision taking into account variance / ev.

do something where you can work as hard as you possibly want and still gain non diminishing returns (or less diminishing)- eg if u start your own business you can work 24 hours a day if you want, and every hour will be as useful as the last hour; in employment you will climb ranks fast doing this but you are still handicapped by someone else.

Also i guess working in an objective way is important like all things; eg u can cut the onion how you always cut it and spend half the time, or you can slowly cut it the same way a chef would and eventually cut it twice is fast forever.