Make Yourself Rich

MAKE

YOURSELF

RICH

The Untold Secrets to Becoming Wealthy

ROBERT BANKS

Copyright

MAKE YOURSELF RICH

The Untold Secrets to Becoming Wealthy

ROBERT BANKS

Copyright 2015 Robert Banks

A Smashwords Edition.

All rights reserved.

No part of this book may be reproduced in any form or by any electronic or mechanical means including information storage and retrieval systems, without permission in writing from the author. The only exception is by a reviewer, who may quote short excerpts in a published review.

The information presented herein represents the views of the author as of the date of publication. This book is presented for informational purposes only. Due to the rate at which conditions change, the author reserves the right to alter and update his opinions at any time. While every attempt has been made to verify the information in this book, the author does not assume any responsibility for errors, inaccuracies, or omissions. The author makes no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaims any implied warranties of merchantability or fitness for a particular purpose. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. The author shall not be responsible for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential or other damages.

About the Author

From the dotcom frenzy to the present day, I've led and advised businesses in Travel, Internet, Advertising, Telecoms, Gaming and TV. I've mingled with the global super-rich from Moscow to Monaco. Everything I say is based on my own real-life experience. I made it from broke to millionaire. With this book, so can you.

Contents

Title

Copyright

About the Author

Introduction: Why You Should Read This Book

Why You Need to Take Action

1. Your Odds of Getting Rich

How Many of Us Are Millionaires?

The Rich Are Getting Wealthier

The Richest Astrological Sign?

My Own Evolution

Who’s in the Game?

Should I Go for It?

2. Seven Surprises About Getting Rich

1. You Don’t Need to Be Original

2. You Don’t Need to Invent Anything

3. You Don’t Need to Start a Business

4. You Don’t Need Money

5. You Don’t Need a Team

6. You Don’t Need to Take Big Risks

7. You Don’t Need Connections

3. Think Like a Millionaire

The 21 Traits of The Wealthy

1. Know Themselves

2. Have a Plan

3. Invest Rather Than Buy

4. Leverage Their Time and Assets

5. Disciplined

6. Greedy

7. Discontented

8. Practically Minded Dreamers

9. Practical Intelligence

10. Independently Minded

11. Ruthless

12. Decisive

13. (Sometimes) Immoral

14. (Very Occasionally) Psychopathic

15. Jealous of Their Reputation

16. Socially Connected

17. Work = Play

18. Rootless Cosmopolitans

19. Instinctive Traders

20. Charming

21. Don’t Consider Themselves Rich

4. How Big Companies Stifle Innovation

The Advantages of Ownership

Other People’s Money (OPM)

Nobody Wanted Google

Good Ideas Are Precious

Have Courage

5. Ownership Is the Key to Wealth

Keep Majority Control

Reduce Your Risk

Cash Is Oxygen

Flash the Cash

Live on the Edge

Peace Brings Prosperity

Own the Toll Bridge

Own a Business With Asset Value

Potential for Growth

Go East Young Man (or Woman)

The Magic of Compound Interest

Real Estate

I’m Happy As I Am, Thanks

6. The Right Business for You

What Makes You So Special?

Five Profit-Killing Forces

1. Aggressive Challengers

2. Easy Substitutes

3. Demanding Customers

4. Powerful Suppliers

5. Fearsome Rivals

Don’t Open a Restaurant

The Well in the Desert

7. Make Selling Your Friend

23 Practical Selling Tips

1. Know Your Product

2. You Deserve Respect

3. Listen

4. Your First Sale Is the Hardest

5. Deliver on Promises

6. Get Referrals from Satisfied Customers

7. Talk to People Who Have the Power to Buy

8. Talk to People Who Are Ready to Buy

9. Keep Records

10. Don’t Try to Persuade Minds Which Are Made Up

11. Work From a Big List

12. Network and Use the Internet

13. Use Email Intelligently

14. Never Cold Call

15. Smile and Dial

16. Give Yourself a Target

17. Follow Up Promptly

18. Keep Presentations Short

19. Personal Win for the Customer

20. Justify Your (High) Price

21. Recognize the Power of Brands

22. You Don’t Have to Be an Extrovert

23. Make It Look Easy

8. Get Rich With No Money

Friends, Family, and Fools

Where the Rich Put Their Money

Why People Become Investors

Banks and Government

You Don’t Need a Business Plan

Ingredients of Your Investment Pitch

1. Market Size and Potential

2. Proof of Concept

3. Secret Sauce

4. Management Team

5. Summary Financials

Seal The Deal

Managing Investors

Alternatives to Investment

9. Why Most Startups Fail

Expect Surprises

Risks Faced By Startups

1. Market Risk

2. Sales Risk

3. People Risk

4. Technology Risk

Join the In-Crowd

10. Buying a Business

Management Buyouts

Turnarounds

Who Needs You to Survive?

Turnaround Plan

Month 1: Stabilization

Months 2 + 3: New Business Plan

1. Products

2. Sales & Marketing

3. People

4. Finance and KPI’s

5. Implementation

Plan B: Prepack

11. Why Working for Yourself Is Different

Change These Ten Bad Habits

1. Stop Asking for Permission

2. Don’t Look Back

3. Don’t (Over) Analyze

4. Don’t Listen to Feedback From the Wrong People

5. Don’t View Investors as Colleagues

6. Don’t Treat Employees as Co-Founders

7. Don’t Talk to Your Bank

8. Don’t Bet the Farm

9. Don’t Congratulate Yourself

10. Don’t Over-Sell

12. Cashing Out

Lay the Groundwork

The Process of Making the Sale

It’s a Numbers Game

Don’t Use an Accountant

Nobody Wants a Bargain

13. How to Be Rich and Happy

Why Money Is Sexy

Pay More, Get Less

Stealth Wealth

Make It and Give It Away

Be Rich and Be Free

Living Among the Rich

Wish I Had Your Problems

14. Get The Life You Want

How Wealthy Do You Want to Be?

Can You Be Rich And Good?

What’s It All For?

Money Gives You Options

Introduction: Why You Should Read This Book

The only people who say that money doesn’t matter are poor and don’t want to feel depressed about it. Or they’ve been too rich for too long to remember how miserable it is to have no money.

This book is for the rest of us. It tells you how striking out onto the path to riches will change you.

I aim to cut through the confusion and mixed messages that characterise the acquisition of wealth. You hear talk about life being tough in the corporate jungle – what does this mean exactly? What kind of animals prowl around there? How does this relate to you? It is said that money changes people – how exactly? Should you be worried?

Do most self-help books about making money not ring true to you? Me neither; they talk about a world I don’t recognize. The books describe a world that is fair and principled. Everybody wins by working together and companies prosper by delighting their customers.

Not to say that these factors don’t play a part, but the full picture of how a small minority beguile their way into appropriating most of the planet’s resources is rather different.

Most business writers don’t speak from experience, or at least not their own first-hand experience. They are lecturers, bloggers, writers or journalists. They rely on secondhand information by interviewing people with money. Problem is, the rich have their own agenda. They want to become recognized as philanthropists and an inspiration to future generations. If their ego is big enough, giving them a strong desire to be loved and admired, the rich write books about themselves with the same legacy-building agenda.

This is not that kind of book. You deserve honesty in return for parting with your hard-earned cash. I describe the tough and exciting world that people like myself operate in. Our primary goal is to provide for ourselves and our families. We want to make as much money as we can with the least risk possible. My story is based on nearly twenty years clawing my way up from penniless to self-made millionaire. I wish someone could have told me what I had to learn for myself the hard way. Spend a couple of hours reading the practical wealth tips in this book and you won’t have to.

I tell you what it feels like and how taking the path to wealth will change you. The fear, exhilaration, loneliness, pride, and confidence that comes from leaving the security of the herd and standing up for yourself, and thus providing services that people value and employment for others. Sadly, it is the way of the world that rich people are generally not nice people. Money is a hugely powerful force, sucking you in and warping values and attitudes. The stresses and demands of making and then having money can have alarming consequences for yourself and those close to you. This book warns you about what to expect and how to protect yourself.

Why You Need to Take Action

Do you really want to be rich? Or are you just tired of being poor? After a century of generally rising living standards, during the past decade middle-class incomes in the US and Europe have slowed to a standstill. The doctors, teachers and architects who form the backbone of our society face the an uncertain financial future.

It’s even worse for blue-collar workers. In the face of cheap immigrant workers undercutting the power of the unions, their incomes have flatlined now for twenty years. Nothing against people who come to a new country to seek a better life; they are bettering themselves like anyone else. It’s just that the benefits of global migrations are not equally shared.

National incomes have risen, but the extra wealth has gone to the rich and the very rich. As we are all living longer, to make things worse, the wealth gap continues to widen in later life.

Easily the most common way that people become rich is by owning a business. Most of the rich are self-made these days. Globalization has given the rich a bonanza that shows no signs of letting up. Previously poor countries are industrializing and getting richer, creating new business opportunities and cheaper supply costs. Having far-flung global operations and an international lifestyle means the rich avoid paying taxes. Those who benefit the most pay the least.

None of this is right. But this book is not about righting wrongs. Wouldn’t it be nice if we lived in a fair world where everyone was justly rewarded? The truth is we don’t. You can’t beat the capitalist system. It overcame communism and nationalism. It is more powerful than governments. The system will crush you if you dare to challenge it. If you’re not happy with your current situation, do yourself a favor and make the system work for you.

With this book, learn from the rich and become one of them.

1. Your Odds of Getting Rich

Along with being happy, loved, and in good health, being rich must rank as an almost universal aspiration. Clear evidence for this is that in any country in the world that has a lottery, ticket sales are huge despite the fact that the chances of winning that life-changing jackpot are tiny.

In Europe, the odds of winning the Euromillions jackpot of up to €190 million played in nine European countries are 117 million to one. In the US, the $448 million Powerball record jackpot in August 2013 had even worse odds of around 175 million to one.

In comparison, your chance of being injured in a lightning strike in any particular year is between 500,000 and 750,000 to one. So this fervent but unrealistic aspiration to get rich is matched only by the extremely long odds. I used to run a lottery, and it’s a good business to be in.

Annual Ticket Sales of World’s Largest Lotteries

Italy: Lottomatica S.p.A. $29.9 billion

China: China Welfare Lottery $17.4 billion

France: La Francaise des Jeux $14.8 billion

China: China Sports Lottery $14.7 billion

Spain: Loterias y Apuestas del Estado. $12.6 billion

Japan: Mizuho Bank Ltd. $11.9 billion

United Kingdom: The National Lottery $9.9 billion

Greece: OPAP S.A. $6.8 billion

United States: New York Lottery $6.8 billion

Italy: SISAL S.p.A. $4.7 billion

So if almost everybody wants to be rich, how many of us become millionaires?

How Many of Us Are Millionaires?

Lets look at the US as an example. The US population is 313.9 million, and nine million are millionaires. Therefore, being a millionaire puts you in the top three per cent. Of course, if you are one of the lucky three per cent who looks around at your nine million neighbours in the Rich Club, some of whom will be your actual neighbours whom you see every day, and compared to them, you’ll consider yourself relatively poor. The guy who has a Rolls-Royce in his garage envies his neighbour who has a Rolls, a Bentley, and a Ferrari.

But viewed by the other 97% of us, being part of the three per cent looks pretty darned good!

So on the face of it the odds are thirty to one, which is better than Powerball. Particularly when you consider that most US millionaires consider themselves self-made, with only a minority (around 14%) born wealthy. Marrying money is the other common route into the Rich Club.

You might imagine that the members of the US high-earning Rich Club don’t change much from year to year, but you’d be wrong. The average American has a one in nine chance of spending at least one year of their life among the top one per cent of earners at some point, according to research. More than a third (36%) of us will spend some time in the top five per cent and just over half (53%) will make it into the top 10%. You have a 70% chance of making it into the top 20% of earners, according to Professor Thomas Hirschl at Cornell and Professor Mark Rank at George Washington University in St. Louis.

The study was based on forty-four years of official US tax returns from 18,000 people. The income required to make it into the top one per cent was a combined household income of $375,000. This is a substantial sum. But the study claims that over the past thirty years, college educated people have increasingly married other people with a degree, meaning that this is not a massive hurdle for families with two white-collar professional incomes.

These are the top earners but they are not necessarily the rich. You can have a high income but not much to show for it at the end of the year.

Wealth means owning assets.

The vast majority of millionaires have made their money by owning a business, so this is the main subject of this book. It is your guide to the paths and pitfalls that lie ahead of you on the road to riches.

If you are unhappy, you have the choice of either trying to beat the system or joining it. The internal contradictions of the capitalist system do not seem likely to result in its collapse anytime soon. So if you can’t beat the system, join it on your own terms and stake your claim for the means of production, distribution and exchange.

Most people drift through life and do what they’re told. It’s an easy life with much to recommend it. Most of the people you know, and most of your friends and family probably follow the herd.

Either you learn to think for yourself, or others have to do your thinking for you. If you let others take on this responsibility, you can hardly expect them to be thinking of your best interests. Most of us know we’re being exploited. We grumble but we’re never going to do anything about it.

It’s a comfortable life and no one will criticise you for living it. It’s the way that most people live. It is up to you if you want to make your own choices and follow the only realistic path to wealth, which does not include winning the lottery.

The Rich Are Getting Wealthier

The trend since the 1980s is for a tiny proportion of the population to make an increasingly eye-boggling amount of money. How you react to this trend depends on your view of the world. According to the charity Oxfam, the world’s richest one per cent own almost half (48%) of the world’s assets. The richest 20% have 94.5% of the world’s riches. The other 80% of the population have to get by with the remaining 5.5%.

Forbes magazine counts 1,826 dollar billionaires. A third are US citizens, with three of the top five being Americans. Microsoft Founder Bill Gates takes the top slot. Gates has been the world’s richest person for sixteen of the past twenty-one years. Gates is followed by Carlos Slim (telecoms) Warren Buffet (financier), Armancio Ortega (retailing) and Larry Ellison (software). None of these individuals came for spectacularly wealthy families.

The US has more than twice as many billionaires as the runner-up, China (including Hong Kong), followed by the UK in third place and then India, Germany and Russia.

Self-made money forms an increasing percentage of the wealthy which is encouraging news for the rest of us. Only about one-third of the Forbes billionaires started from a position of wealth, in other words having inherited some or all of their riches. This trend is replicated in other