The Narrow Road

In truth, most of the so-called reasons for not pursuing wealth are not reasons at all; they are excuses. Pitiful alibis, half-truths, and self-serving evasions you have erected to spare yourself from the quiet terror of taking your own financial destiny in your hands and making your dreams concrete reality. They are the children of fear and the parents of a thousand “if onlys.”

Tunnel vision helps. Being a bit of a shit helps. A thick skin helps. Stamina is crucial, as is the capacity to work so hard that your best friends mock you, your lovers despair, and your rivals and acquaintances watch furtively from the sidelines, half in awe and half in contempt. Self-confidence helps, but can be simulated or acquired along the way. Tenacity is an absolute requirement. Luck helps—but only if you do not waste time seeking it. The belief that you have a great idea is not worth cuckoo spit. Ideas are ten a penny while the ability to execute counts for a great deal more. The answer to “Who is likely to succeed?” then, is this: not those who want to and not those who need to or those who deserve to, but those who are utterly determined to, whatever the cost to themselves and to those around them.

To what degree are you prepared to dedicate yourself to the task? How many times are you willing to fail, perhaps publicly and humiliatingly, before you succeed?

Tenacity will eventually trump all other qualities, whether inherited, acquired, or mimicked.

Forget glamour if the getting of money is your priority.

Gold rushes rarely happen in old mines. New or rapidly developing sectors often provide more opportunities to get rich. The reasons for this include: (1) availability of risk capital; (2) investor ignorance and greed; (3) the power of a rising tide.

If you are not prepared to work longer hours than anyone you know, you will never be rich.

If you cannot treat your quest to get rich as a game—a silly game with serious rules—you will never be rich.

A beautiful vase of flowers in reception every week creates a better impression than $150,000 worth of fancy Italian furniture.

Compulsion trumps desire in two ways: intensity and longevity. Those who feel compelled are more likely to focus relentlessly and exclusively on the attainment of a particular goal. In addition, they are likely to shrug off repeated failure and return to the fray with undiluted energy.

Life is not a rehearsal. The getting of money may be a silly game, but it is a game with serious rules. It requires a level of discipline and toleration of hardship that is inimical to what most people regard as the purpose of a fulfilled life. Only the participant’s absolute certainty that the goal can be achieved makes such a marathon tolerable. Do not mistake desire for compulsion. Only you can hear the song of your inner demons. Only you can know if you are willing to tread the narrow, lonely road to riches.

If you are determined to become rich, there is only one talent you require: the talent to identify, hire, and nurture others with talent.

Talent is the key to sustained growth, and growth is the key to early wealth.

There are six simple rules concerning talent: identify it, hire it, nurture it, reward it, protect it from being poached. And, when the time comes, fire it.

Talent does most of the work for you, just as it has done since the beginning of recorded history. After all, who created the Egyptian pyramids? The pharaohs or the engineers? Think about it, then go hire the best talent you can find—just as the pharaohs did.

It is always the right time and this is the only place we have.

You cannot get rich all on your own. No one can. You have to work within (or, more likely, create) the right environment.

This does not mean that you require fancy offices and all the accoutrements. Human capital is by far the most important element of your environment, whether you’re starting up or deep in the game.

By focusing on obtaining the right human capital you vastly increase your chances of becoming rich. Your employees, colleagues, professional advisors, suppliers, and customers are all human capital. Choosing those that will serve you best is an art form.

Stupid people are easy to hire. The world is full of the none-too-bright. Many of them are extremely pleasant to work with, don’t cost too much, and will give you a lovely smile each morning. But they will not add to your wealth, and in the early days you should shun them like the plague. What you require are clever, cunning, and adept people.

The willingness to hire those cleverer than yourself is a potent weapon in the getting of money.

Do you need to hire anyone? Will such a hire permit the company to increase revenues by seven to ten times the base salary of a candidate? If the answer is “probably not,” don’t make the hire.

Try not to choose key employees by yourself. Have others interview them and compare notes. This guards against the natural impulse to hire those similar to oneself.

Don’t just rely on a candidate’s résumé. If you can, speak to their previous employer.

Say little if the interviewee grinds to a halt—that way, you will learn swiftly how they react under pressure.

Ignore prejudices, likes, and dislikes. This is not only good law, it’s good sense. Effectiveness, integrity, adeptness, professionalism, a desire to shine in the world—these are the attributes you seek. Who you like or do not like is irrelevant.

Any ship piloted by two captains will sink.

Most partnerships are created on the basis of three criteria: Who is investing what capital into the project? Who will be actively working on the project? Who brings what value to the project?

Good ideas are like Nike sports shoes. They may facilitate success for an athlete who possesses them, but on their own they are nothing but an overpriced pair of sneakers. Sports shoes don’t win races. Athletes do.

If you never have a single great idea in your life, but become skilled in executing the great ideas of others, you can succeed beyond your wildest dreams. They do not have to be your ideas—execution is all.

When confronted with a great idea, your reaction should be to scrupulously analyze its commercial potential in the context of your own ability to transform that potential into triumph.

Ideas don’t make you rich. The correct execution of ideas does.

When you are starting up, however, I believe you should dress conservatively in business attire with the traditional accessories. After all, it’s you asking others to invest in you, to work for you, to become suppliers to you, to trust you. By dressing in what some may consider an old-fashioned way, you show respect without exhibiting undue deference.

When I put on my suit, white shirt, tie, and black shoes, I am subconsciously donning armor. I am going out to do battle. Nobody will give me more money—I am going to have to earn it. By dressing in this way, I remind myself I am dressing for war, not stepping out for a stroll in the park.

You should insist that salespersons working for you dress conservatively.

The getting of money is a game.

To become rich, every single percentage point of anything you own is crucial. It is worth fighting for. It is worth suing for. It is worth shouting and banging on the table for. It is worth begging for and groveling for. It is worth lying and cheating for. In extremis, it is even worth negotiating for.

Nothing counts but what you own in the race to get rich.

Ownership isn’t the most important thing in the getting of money—it is the only thing.

Your customers are the final arbiters of your financial destiny.

I urge you to keep thinking and keep researching your future customer base(s). Hone your USP (unique selling proposition) to a razor-sharp instrument.

There is only one enemy.

Time spent recharging your batteries and maintaining your physical and mental health is not wasted. It is a necessity. Time frittered away attending to tasks easily achieved but relatively inessential to your ultimate goal is wasted—a criminal waste of a precious resource.

If you will not prioritize your tasks for the day, the week, the month (even for the year) and execute them on the basis of their relative importance, you remain at the mercy of your idle subconscious and happenstance.

Ruthless prioritizing in the getting of money is the sign of a disciplined, determined mind; one far more likely to succeed. The happy-go-lucky may call it an obsession. So what? I doubt you will meet many happy-go-lucky souls on the narrow road. Prioritize everything in your working day!

My own rule is to keep company debt, if at all possible, to less than 25 percent of annual revenues.

There is an often overlooked adjunct to the subject of ideas in commerce; stealing them. Or, to put it more pleasantly, emulating them.

The error of failing to emulate a winning idea pervades every industry, at all levels, and always has done.

What works for others on the narrow road will very likely work for you, too.

All who learn to delegate wisely (and early) increase their chances of success in the getting of money to a significant degree.

Micromanagers, by contrast, unwittingly “kill the thing they love” and endanger their odds of making real money.

I would add that the person who employs the person who tells others what to do is even better paid. And always will be.

Entrepreneurs and moguls are often poor managers because they never had time to practice the art of management. They were too busy delegating and becoming rich.

Tenacity is not persistence and has nothing to do with stubbornness. Instead, it is a potent weapon in the armory of those few destined to become far richer than their neighbors. I will go further. Not only is it a weapon—it is a fuel. A fuel to sustain those who continue the long trek on the narrow road when others have decamped and built their modest homesteads in the safer plains of mediocrity.

Coupled with tenacity, self-belief lies at the core of the getting of money. Without self-belief, nothing can be accomplished. With it, nothing is impossible.

Lead. Do not be led.

You have hired a talented group of employees at your start-up, many of whom are smarter than you. Great. But you are their leader.

If you sniff an opportunity, get them to consider it. If they equivocate, call a meeting and brainstorm. If they still won’t get excited, take the project into your private office and begin it there. Do not leave such an opportunity within the company to be sabotaged, focus-grouped and committeed to death—which is almost certainly what will happen if, for whatever reason, your colleagues are not excited by it.

How do you become a leader? By not seeking all the glory (only the money!) your smarter employees earn. And by uncompromising, sustained effort. As Warren Bennis observed in On Being A Leader: “Leaders learn by leading, and they learn best by leading in the face of obstacles.”

The work undertaken by your colleagues and employees is more important than your work. Your job is merely to lead, to point the way, unless there is no one but you in the enterprise. (In which case, you had best stop reading this and get straight back to work.)

Making time to sleep well, eat well, and take an occasional walk in the park is not slacking, not a betrayal of the cause. It’s just good sense. The getting of money is a marathon, not a sprint. Keeping mentally and physically fit is essential.

It is astonishing how often young entrepreneurs forget the need to diversify revenue streams.

If, on my deathbed, I had only a short time to pass what wisdom I had accumulated about the getting of money to a son or daughter, it would be this: Ownership Shall Be Half of The Law Doing an Outstanding Job Shall Be the Other Half

Talent will flock to a company with a reputation for excellence.

It is more enjoyable to own a company dedicated to excellence—you will relish coming to work and will spend more time focusing on doing an even better job.

Salaries for senior employees are decided by the market. Bonus arrangements are yours to make. Make them generous if you wish your managers to concentrate on improving margin and bottom-line profit while growing the business.

Consider a three-part system for senior managers: two bonuses to be paid annually and a third at the close of a bonus cycle of three to five years. The first is for individual performance; the second is for performance as a group—to encourage self-policing against slackers. The third is the big payday—by staying the course and delivering consistent profits and growth over an agreed number of years, all managers in the bonus pool receive a substantial additional bonus. This encourages your managers to turn their back on short-termism and guards against poaching.

In the event of outstanding performance (especially in difficult financial times), it makes sense to err on the side of generosity.

Western capitalism is made bearable only by competition. Death to monopolies! Your rivals will keep you honest and inspire you to emulate their successes. They are a terrific source from which to poach talent and fun to meet with from time to time, to swap notes and tell lies to one another. An entrepreneur who loathes his rivals is usually a fool. Bad-mouthing rivals is a sign of weakness. You should set an example among your troops, encouraging them to analyze a rival’s strengths rather than sneering at its failings.

Make it a habit to meet informally with a rival’s talent when you can. I have never known a single person in a rival organization, however well paid or cosseted, who refused to meet with me for a quiet drink after work. In this way, I have discovered more about what my rivals are up to than they ever imagined. Then, too, I have often been so impressed with an individual that I poached him or her to work for me later. No intelligence-gathering exercise is ever entirely wasted in business.

Never fall in love with a deal. A deal is just a deal. There will always be other deals and other opportunities. No deal is a must-do deal. If it is, you are at the mercy of the party sitting across the table and—trust me—they will know this perfectly well. In that case, your goose is cooked and your future will already be in their hands.

Hire the best-qualified accountant or finance director you can afford, even before you can afford them. Bean counters are one thing; qualified accountants and finance directors are another. Books and records need to be kept, but there will be no books and records to keep if you stint on full-time expert financial advice. Such people will fight tooth and nail to reduce costs. They will impress suppliers and banks and help extend your credit. They will constantly remind you of the perils of overexpansion. They will become a burden and a pest to you every working day. But they will also ensure that you survive, if that is at all possible.

You will greet the arrival of your first finance director and chief operating officer with open arms. Then you will come to loathe them. Then respect will creep into the equation. Then you will hand them huge bonuses (and do so gladly) as the company turns the corner into blessèd profitability.

All money you take from your company must be paid as salary, a bonus, a dividend, or the equivalent—and all such payments must be declared.

The company’s profits are the company’s money. Despite being sole shareholder, if you take money out of the enterprise and do not declare it as salary, a bonus, or a dividend, you can be accused of stealing from your own company, not to mention stealing from the tax man. It sounds bizarre, but it’s true.

How to sum all this up? If your company can afford to pay you money, that’s fine, just as long as you declare that it has been paid and are ready to cough up the tax on that payment.

On Buying Private Yachts, Airplanes, etc. Don’t. If it flies, floats, or fornicates, rent it. It’s much cheaper in the long run.

Not worth considering, in my view. Taxes are an abomination, granted, but you are not in a position to muster the army necessary to counter that at the disposal of the tax man: sheriffs, the police, the fraud squad, the courts, and all the rest. One of the most important hires you will ever make, once you have earned a little money, is your personal financial advisor. This individual should work for you, not for your company. As soon as you have enough money, they should work for you full-time. For many entrepreneurs they may become the nearest thing to a “partner” you will ever have.

Finding ways for you to pay the least tax permissible is a personal financial advisor’s job.

Well done, well done! I will probably be dead by the time you come to this juncture. My posthumous advice is to cut that tiger loose from your ankle and begin giving your money away right now. (You might find that almost as hard as it was to make it.) It was all just a silly game, wasn’t it? Good fun, though. Don’t forget to help other young entrepreneurs when you can. But don’t tell them what you found at the end of the road. No need to spoil the surprise!