The Art of the Pitch …


“Everybody is selling something all the time” [Anon.]

I don’t know who said that (probably me!) but it’s true; everything is a sales pitch:

– asking a girl/guy out on a date

– a marriage proposal

– a loan application

– a job application

– a promotion request

– a sales visit

– a venture capital ‘pitch’

Guy Kawasaki outlines a great approach to ‘pitching’ for anything in his masterpiece for budding entrepreneurs, The Art of the Start.

And, consummate VC, Chris Rose, fills in some of the blanks in this great 14 minute video … watch it, bookmark it, you’ll need it (one day) ….

How to build a conglomerate …

I wrote a post a while ago, in response to a reader question, that questioned the sanity of an entrepreur following my path and owning multiple concurrent businesses.

I said: bad idea!

However, Diane points to a number of conglomerates (a collection of related or unrelated businesses under common corporate control) that make money because they diversify into multiple businesses and sectors:

Most conglomerates are good examples of diversified businesses (GE comes to mind). One could also buy complementary businesses. Your risk level is affected the same way as it would be with diversifying any investment.

Your example of multiplying the management teams (and thereby increasing risk to each business) is interesting, Adrian. This is precisely one a buyer of companies is looking for (like your friend Brad) – inefficient management with an underlying fairly decent business. You buy and consolidate, combining the common management (HR, Acctg, IT) that runs across each company, combine anything else you can “leverage” (logistic chains, purchasing power, for examples), and save money, thereby reducing costs and making it even more attractive to investors (depending on which kind you want).

And, it’s true: a conglomerate can diversify a company’s risks, just like diversifying a stock portfolio … the problem is – just like any other diversification strategy – you equally ‘wash out’ your successes with your failures.

My issue is that this may work as a ‘risk mitigation strategy for large companies, but it’s too risky for smaller (e.g. sole, or family) operators.

Large conglomerates build up over time, usually using one successful business to fund the rest. The key is having good management in each … the risk (for a small player, like you and I) is trying to BE that management.

A great example is Warren Buffett: he started Berkshire Hathaway by buying a controlling interest in a mediocre textile company and raised cash simply by stopping the dividend stream to the shareholders …

… he used that cash to buy an insurance company, and used policyholder cash from the insurance company to buy more companies.

The interesting thing is that he does NOT look for companies with poor management; rather he buys GOOD companies with GREAT management and keeps them in place, doing what they do best: creating more cash for his next company purchase … and, so on goes Warren’s $40 Billion – $60 Billion (his personal net worth in Berkshire Hathaway) ‘cash machine’ that owns more than 75 companies!

The problem is that Warren only got to this point because he couldn’t find one company that ‘did the trick’ … he would, however, put 60% to 80% of his entire net worth in just one investment/business, if he could find it!

Blogs, blogs, and more [bleep'ing] blogs!


It seems like I am embroiled in a torrent of writing; even my 11 year old daughter asks why I am working at my computer all day on something that makes me absolutely no money … she suggests that I go out and get a ‘real job’.

I guess neither my daughter nor I actually understand the concept of ‘retirement’ 🙂

Which leads me to Dustbusterz’s e-mail opinion, which may be shared by others, hence my posting it here:

You post on too many places, and it becomes confusing and difficult to keep up with the concept. It seems you go to one site, get a little info, then go to another site, get a little info , then get a bit of info in email. And trying to tie it all together just wracks the mind. I believe it would be much simpler for everybody if you chose one concept(such as video posting every day) instead of this post here post there kind of treatment.

Thanks for sharing, Dustbusterz!

If it helps, here’s how it works:

Blog 1: – This is my main blog where I share ideas and strategies on Personal Finance. The rough framework is sketched out via the tabs across the top (eg Road Map to Riches; Making Money 101; etc.).

Blog 2: – Because blogs (yes, even mine!) can be ‘theoretical’, I thought that I would start a 7 year ‘experiment’ by helping 7 volunteers (and as many of our readers as want to participate) to make their Number (hopefully, in the millions). This is a sequential process, albeit tailored to the needs of each of the 7 … making money takes time, so the ‘lessons’ will inevitably be spaced out over a long period of time.

Blog 3: – This is not really a blog at all, but my live Internet chat show … my son’s idea; not sure why I am doing it, but I enjoy the ‘real time’ aspect. And, my Youtube videos (posted at yet another site: get multiple viewings. I guess some people like to hear an Aussie with a funny voice/accent speak!?

Whereas Blog 1 is random/theoretical, Blog 2 is paced/practical and centered around the needs of each of the 7 MITs.

Blog 4: (which has taken a pause, while I set about launching Blog … actually, Site … 5) – This is purely for fun and to see whether it’s possible to make money online … with this blog it’s ME who is the subject of the ‘experiment’!

Blog 5: There isn’t one (officially) yet … but, I will be making an announcement very shortly! In the meantime, you can get a ‘sneak peek’ here.

Read one or all blogs/sites, together or independently … it doesn’t really matter as long as we can all get something out of it.

Thanks for your suggestions, Dustbusterz, I’ll see what I can do (like this post for example) to make it all easier to navigate!

Finding your Life's Purpose!


This blog is called “How To Make $7 Million in 7 Years”.


Not “Why”.

Not “I made $ 7 Million in 7 years so nyaaahhh!”.

But, how you can make $7 Million in 7 Years.

It’s written from the point of view of a pretty ordinary guy who went from worse than you ($30k in debt) to financially better than you (most likely) … and, who happens to believe that there is a ‘system’ to making money that you can follow.

Not some secret “buy my $10,000 course on how I went from broke to millions [insert method of choice: flipping real-estate; gambling on stocks and options; buying tax liens/gold/silver; or even futures trading]” but, a ‘system’ – or roadmap, if you prefer – nonetheless.

And, I want to share that system here and at my sister site 7 Millionaires … In Training! where you will even get to participate (or just follow along) as 7 ordinary folk actually do make their own millions over the next 7 years.

No catches … no schemes … just good ol’ fashioned financial advice.

Hell, I won’t even take advertising, let alone ask anybody to pay me a penny, through either of these sites!

So here is the how, but I warn you …

… you’re not going to like it.

Because it begins now … with finding Your Life’s Purpose.

You may wonder what all this New Age crap is all about, and what it has to do with making serious money?!

“Finding your Life’s Purpose” sounds like something that you would more likely find in The Secret more than in a ‘serious personal finance blog’ 🙂 such as this one?!

And, it’s true … while I don’t hold much store in the idea of “Visualize your way to Abundance” mantra …

[AJC: after all, why restrict yourself to a few measly million bucks, if you can just as easily visualize your way to $5 Billion AND feeding the world, putting an end to all wars and sickness, and reversing global warming … all before lunchtime?]

… I do like the idea of starting a journey with a clear idea of your destination.

Building personal wealth is like sailing a huge cruise liner … those things just don’t steer all that damn well!

So, you had better have a good idea of where the final destination is well ahead of time, so that you can:

a) Choose your ship – Long journey? Short hop?

b) Identify your likely route – In harbor? Open ocean?

c) Prepare for the worst – Mild chop? Ocean swells?

In personal finance terms these translate to:

a) Your Number: $1 Million? $10 Million? and Date: 20 years? 5 years?

b) Job + 401k? Business + Investments?

c) Interest rates? Market cycles?

It’s only if you know how your Number/Date combo. lies on the Small/Late to Large/Soon continuum that you can begin to select optimally from a), b), and c).

So, I found that setting my destination – my Life’s Purpose – was the catalyst that drove me from also-ran small-business owner to real-estate magnate and multinational entrepreneur.

Once I knew that my Number / Date was rammed so damn far along the Bloody Large / Impossibly Soon side of the scale, that I was literally forced totally out of my comfort zone into (eventually and not without significant risk and trauma) a totally new one!

Understanding my Life’s Purpose ‘scared’ me into massive action – and, as we know massive action breeds incredible results – which is exactly what my doctor ordered 😉

So, if you are now totally driven to find Your Life’s Purpose, here’s how to do it; a simple 6 step program first taught to me by Michael Gerber of E-Myth fame:

1. Whet (wet?) your mental whistle with a few well-chosen questions.

2. List the things that you don’t want in your life.

3. List the things that you do want in your life.

4. Break the (always self-imposed!) barriers in your life.

5. Write your rear deck speech (really!)

6. Wacko Jacko … Presto … 48 hours later: Your Life’s Purpose.

Easy … perhaps, but not quite as as easy as it sounds. Profoundly financially life-changing … absolutely!

Even for a cynic like me ….

… maybe it will do the same for you?

Now, hear the word …

I don’t normally chain my video-on-Sundays (too much hard work for both you an me on ‘day of rest’ Sunday) …

… but, I showed a video that explained how important marketing is, to which Scott responded:

I completely agree that marketing and being a good marketer is one of the most important wealth building tools you can have. A definite and powerful Money Making 201 skill, but one I personally don’t enjoy, lol.

It’s not that it’s so bad, it’s just the part of my practice that goes into the “work” category, along with paperwork and dealing with insurance reimbursement, when I would rather be focusing on my ‘life’s purpose’ part of my practice, which is helping patients.

However, it’s only when I step it up and be more of a marketer and insurance master that my income goes up.

It’s funny, in school I thought the opposite would be true, that I would be more financially successful if I focused on being a better, more caring and more compassionate doctor.

Scott, you’re a doctor so, just remember:

Your marketing bone is connected to your income bone … your income bone is connected to your investing bone … your investing bone is connected to your Number/Date bone … your Number/Date bone is connected to your Life’s Purpose bone …

… Now, hear the word!

When you truly understand this (through trying it and beginning to see results), you will magically shift your thinking:

Marketing will no longer be in the “work” category (along with all of that other boring stuff like “paperwork and dealing with insurance reimbursements”) …

… it will pop into it’s own “enabling me to truly live my Life’s Purpose” category and you will grow to LOVE it 😉

Riding in the big boat while carrying the little boat …

There was a great article in eLance’s blog today (AJC: I didn’t know they had a blog, but I used the site to find my research assistant, Muhammad, who lives in Pakistan and is doing a great job for me at $4 an hour!) …

… here is a summary (with my thoughts in italics):

Tips for Incubating your Small Business Idea While Still Working Full-Time

Have you considered starting a business while still employed?

My Shanghai-born friend, Annie, says the Chinese have a term for this: “riding in the big boat while carrying the little boat.”

Some entrepreneurs only launch their business officially once they leave employment. However, they incubate the business concept while employed.

Other times, they actually launch the business and run it on the side while still employed. They may continue to run it as a side business for a period of months or even years. Only later do they leave their jobs.

No matter how you do it, I’ve got 6 practical tips for starting a business while you’re still employed:

1. Consider Your Employer Your Banker
I am a huge fan of bootstrapping a business, i.e., using personal money to fund growth. One form of using personal funds is to set aside a portion of your salary to fund your business. That means you need to protect your funding source — your job — until you are ready to cut the cord.

The author of this article suggests that you need to canvass your employer on ‘moonlighting’ otherwise you should wait until you leave your job to start the business – I would suggest that if the business is critical to your financial future (and, if you’re reading this blog, it probably is) then you should take steps to find a replacement job asap – and, let the new employer know that you are “working on a business ‘on the side’ to improve your business skills” … they might even see that as an asset!

2. Write a Business Plan
Sure, much of your plan will turn out to be incorrect (same goes for most startup business plans). But it’s not the plan that’s important … it’s the planning.

I agree – to an extent: as with your Life’s Purpose, having a Plan for your business is a great idea … but, trying to plan every detail is (at least for me) a waste of time … but, don’t let me stop you! If you want to see a practical approach to planning for any business – certainly, fast-moving startups – read Guy Kawasaki’s Art of the Start.

3. Get your Spouse’s Buy-In
Your husband or wife needs to be committed to your startup. If it isn’t a shared dream, or if your spouse is resentful of the time you are spending away from family, you’re adding stress on your relationship.

You want to stay married and have a business that sucks up all of your non-working time?! ‘Nuff said ….

To secure buy-in from your spouse, talk frequently about your dream. Paint a picture in words. Get him or her involved, too. Nothing creates buy-in better than being actively involved in business decisions.

4. Choose the Right Business

Here are some examples of businesses that can be operated on the side indefinitely for years, or eventually taken into full-time businesses:

  • Software development
  • Web design
  • Freelance writing
  • Online businesses
  • Graphics design
  • Consulting
  • eBay business
  • Event planner
  • Any hobby that you can turn into a business

The author recommends these because you can often be flexible in hours and/or hire outside staff/contractors … the catch is that a number of these businesses aren’t dramatically scalable, which is the #1 criteria that I look for in a business …. remember: scalable = salable.

5. Set Aside Dedicated Schedule for Your Startup

Many entrepreneurs who have successfully started a side business do it by setting aside dedicated hours each day for their startup. I’ve known budding entrepreneurs speak about going home to “start the second shift.” That’s exactly how you have to think of it. Commit to spending X hours per weekday and/or on weekends on your business. Stick to a regular schedule – it makes it easier. P.D. James, the novelist, worked for years as a hospital administrator, arising early to write for 2 hours each morning before work.

This is the best piece of advice in this already excellent post … it is hard to come home from work, only to have to go to ‘work’ … but, it must be done (hence, the prior discussion with spouses and bosses).

6. Turn Your Employer Into Your First Customer
Think of your employer as your first big sales target (assuming your product or service is relevant to your employer). Many a business has gotten off to a great start when the owner’s former employer became the first customer.

Good luck on this one! Still if you CAN get your employer to become your first big customer, it’s a great start: not sure how the whole employee/supplier co-existence thing will actually pan out … I think it will be better if you are able to transition from employee to supplier

If yuor objective is to build a second income stream to support your investing activities – or, perhaps to build up capital to start That Big Business of yours [AJC: I would never let a little issue of capital stop me from starting that one NOW 😉 ] – then this article provides some great suggestions …

… however, if you want to build a ton of money, fast, then you may have building the next Facebook in mind and this article (along with this one) presents a way to get off the ground with minimal risk.

They don't want a drill …


I came across this neat summary of a great quote by Perry Marshall the other day … a quote is as good as a post, so here is one of the greatest pieces of advice about marketing your business that I have ever come across:

“Nobody who bought a drill actually wanted a drill. They wanted a hole. Therefore, if you want to sell drills, you should advertise information about making holes – NOT information about drills!” – Perry Marshall

What that means is that people do not care about your opportunity, what they care about is a solution to their problems.

So, what you need to do instead of pitching your [whatever it is that you sell] to your prospects, sell them inexpensive or free information on how to solve their problems, on how to drill that “hole.”

If you can show them how to make that hole, your prospects will come to the conclusion that they need a drill from you because you gave them free knowledge or inexpensive information on how to accomplish their goal, and therefore earning their trust in you.

Put simply: education sells!

In fact, this is the way to sell ANY client ANYTHING … it’s what I did to make my businesses a success. If there is anything that neatly encapsulates the reason for my business successes, this is it. Really.

College is over. Time for Plan B?

A while ago, I took a risk on this blog … I gave some potentially risky, dangerous, damned GREAT advice!

I suggested – controversially, I would think – that college-age kids should skip Making Money 101 (you know, the standard “save your money, buy some mutual funds” and so on steps) and start to find ways to create new money

… and, the BEST way that I know how to do that is by starting your own business!

And, the best kind of business for college-age millionaire-wannabe’s to start is an internet business (but, any business will do … even a car wash). But, I’ll let you read that post to find out why …

For now, I want to answer this question from Josh:

Would you suggest someone in Alex’s position to possibly skip college and just work on money making 201, saving years that would be used on Money Making 201 activities? Sometimes I think this is what I should have done.

Well, you could – and, I know of others who would suggest that since there’s more money to be made in business than in college, why not skip those years altogether and avoid the wasted time and loans?

But, what if you don’t succeed with the business/es (I did suggest that you plan on at least a couple of failures)?

Well, if you skipped college, that would have been high-risk advice from me …

…. but, since you took my advice and STAYED IN COLLEGE the business failure/s didn’t change your life … my advice only changed how you spent your time and your money during college: instead of drinking and partying – as much 🙂 – you ‘played’ at business and learned something and PERHAPS even become a millionaire in the process!

What could be wrong with that?

But, where’s the benefit (besides the obvious learning experience and the lack of damage to liver and brain cells that would have no doubt occurred if you had chosen the party-and-drink-your-way-through-college-route)?

Well, while you were hunkered down working on your various businesses, you were actually learning some very valuable Making Money 101 lessons in disguise!

Even though I told you to skip Making Money 101, you were actually (by necessity) learning the most valuable Making Money 101 lesson of all: delayed gratification.

Assuming that you followed the strategy that I outlined in my earlier post you kept:

… living like a penniless college kid, mooching off family and friends like any ‘normal’ college kid does, while you’re busy investing 99% of what you earn.

This is invaluable advice (even if I do say so, myself). Why?

Because, in the event that Plan A failed, and your businesses do not make you rich while you are still in College – or at least get you started on the path – you are well-placed to move straight into Plan B:


That’s it? Well, not quite ….

Because you have just become a Frugal Graduate: while most of your peers are already on the path to credit card debt, consumer debt, car debt, and all sorts of bad spending habits you are still in the habit of NOT spending (and certainly not borrowing, unless it’s for your latest venture) money.

So Plan B is simple: Graduate, get a job, and keep living like a College grunge as long as you can possibly can.

You hold out and invest 99% of your money, then 98%, then 90%, then 80% …. but you refuse to buckle at anything less than investing 33%, and only then after a long-and-hard-fought battle against the tide of consumerism that is inevitably going to wash over you.

You keep investing that money in a mixture of real-estate, stocks, and more small businesses (if you have the stomach to keep trying after failure-upon-failure, since this is the ‘worst case scenario’ Plan B) and …

… repeat until rich!

Under this strategy, wealth will come, but I cannot predict the time frame: that is a function of how long and how well you hold up against the tide of consumerism and how fruitful your investments (particularly your businesses) turn out to be.

But, I can tell you this: if you are starting college now, or soon … this is the only financial advice that you will ever really need (conventional wisdom and mom-and-pop financial advice be damned!) …

… if you have the guts to go with it, and the stamina and foresight to stick with it.

And, the rest of us who are already too old, can simply envy you, because time is more valuable than money.

The correct way to look at debt …

BradOK asks:

What’s a better use of my money – pay down debt or invest it in the market?

To which JillyBean responded:

At what rate of interest is your debt? How much debt do you have? Do you have an emergency fund? If you invest your money, what is the purpose for the money — short term or long term? The markets are on a downward spiral and very volatile — it might be more prudent to answer the above questions to determine the answer for the actual question.

You could always compromise and do both! It never is bad to pay down debt.

But, I am always working from the assumption that you want to get rich /stay rich …

… if that’s also your mindset, you might have more clarity if you rephrased the original question as “what’s better, to INVEST in debt or INVEST in the market?”

Once it’s clear that you are making an INVESTMENT every time you pay off debt – even personal debt – or, decide not to, then you will realize that you simply need to consider relative returns.

Then it will suddenly become clear that INVESTING in debt returns you a guaranteed rate equivalent to the interest rate (plus ongoing fees, if any) being charged. On the other hand, investing elsewhere MIGHT return more, over the long-term.

So, your real question that you need to answer is: “What investment will give me a greater AFTER TAX return than my highest interest rate currently outstanding debt?”

If you can find one (and, you have the required skills/interest/knowledge/stamina) then invest in that, otherwise pay down some debt.

Naturally, start with the highest interest rate debts first and work your way down (remember the ‘debt avalanch’?)

More online scams …

Actually, not more, but the same … this time of YouTube.

BTW: This ‘top secret magic code’ that the product will tell you about if you are stupid enough to buy it is none other than Google’s Adsense!

How do I know … well, d’uh … common sense.

PS if it’s NOT Google Adsense (or Adwords) send me an e-mail with proof of what it is and I’ll send you a gift.