Value transfer or value creation?

There are lots of ways entrepreneurs can make money. Some even have a valid legal status, but with questionable ethics. But all businesses which survive have some kind of value transfer. The real question worth asking is this:

Was there more value in total after we got involved?

If the answer to that is ‘yes’, then we’ve done much more than just make money.

New book – The Great Fragmentation – out now!

2 unrelated questions worth asking

Motorcycle ride across asia

The journey we are on is often associated with some goal at the end point. But what if the end point was now? What if we took a thought experiment and pretended the journey was unnecessary? Let’s do that and ask ourselves these two seemingly unrelated questions:

  1. How would you spend your time if you had 6 months to live?
  2. How would you spend your time if you were a billionaire?

I won’t try and answer these for you, but I’m reasonably certain you’ll find two things. Many of the answers overlap, and that many of the things cost very little money. In the end we remind ourselves that the ultimate asset is time.

Ok, I couldn’t resist to give personal answer here: I know I’d want to invest more time with my family, immediate and wider, and do those projects were the business model is fun and not financial. Oh, and all those billionaires we hear about…. they’re probably off on treks riding motorcycles across China. Something which requires very few zeros in a bank account.

New book – The Great Fragmentation – out now!

The average success story

While success is in the eye of the beholder, I heard an interesting fact recently about intelligence and financial independence.  And that fact was that the vast majority of financially independent people have average or below average intelligence. We are talking here about raw intellectual capability. This would seem counter intuitive to everything we are taught to believe in school, the corporate world and life. That we have to be ‘smart’ to accumulate financial advantage. Turns out the opposite is true and social researchers put it down to one simple thing:

“People of average intelligence are not overly impressed with how clever they are.”

Sounds like a silly thing to say, but it gives average people like you and me a big advantage. It means that we know we have to work hard, and maybe even a bit harder. And it also means that we don’t think we know everything already and so we have on open mind to learn new things and methods.

Turns out that some of the key factors in the success equation are about being average.

My favourite entrepreneur hacks

I recently did I podcast with a friend Murray Galbraith who runs Dads.co – a place for dads to share and celebrate being a rad dad. I was particularly happy with the chat we had as it covered many of the important parts of being a dad, and being independent economically. I really think it’s some good ear candy. You can listen to it here.

Also, this Wednesday night I’ll giving a talk at the Entrepreneurs Club in Melbourne, about how to transition from employee to entrepreneur. I’m really excited about this one as I’ll be sharing my top 10 “Hacks of Independence” to help you escape the drudgery of corporate cubicle life. It’s free and you should totally come and share some ideas with other like minded individuals. Details are here.

NEW BOOK – THE GREAT FRAGMENTATION – ORDER HERE!

What you know vs Who you know

I remember growing up having people tell me it’s all about who you know in life and business. I always thought it was kinda weird that it could work in your favour by just knowing people who could help you, especially if you happened to be a fool. Surely domain knowledge mattered more? And here is what I found out, they both have value.

But what has even more value is when we use which ever we have more of to improve on the other. This tends to happen when we learn from those we’re lucky enough to know, or use our knowledge to help whoever we meet.

NEW BOOK – THE GREAT FRAGMENTATION – ORDER HERE!

It’s already been done, or has it?

As soon as we think of an amazing startup idea the first thing we often do is trawl the internet to see if someone has already built the app, the service ,the hardware device. We want to know if it has already been done. Oft times, we are deflated to find out it has been. But if we have to search, has it really been done? If no one knows about a concept in market it raises a lot of interesting questions:

Did they execute well against the idea?

Is their product good, but the distribution poor?

If the distribution is poor, does that mean the product is actually bad?

If the distribution is poor, does that mean it’s not solving a real problem?

If the distribution and product are both good, are the switching costs too high?

Did the team have the right funding?

If they had the funding is the timing too soon – is the market ready?

The truth is we’ll never be able to answer these and other questions. And so it brings us back to the very first moment of inspiration. We thought it was a great concept and maybe that is enough. We know most things change their shape in the development process anyway. Maybe we should build it regardless of what is out there. Build our version of how things could be. Remembering of course that most fortunes are made with old ideas done better. Property is the oldest business in the world and still to this day creates the most millionaires. Even Youtube, a new kinda business, arrived when there were already over 400 video sharing websites (that we know of).

It’s another reminder our world is big on ideas and small on execution.

NEW BOOK – THE GREAT FRAGMENTATION – ORDER HERE!