From the category archives:

millionaire club

The 6 Best Ways You Can Protect Your Business From Being Vulnerable

by David Finkel on February 18, 2011

Thanks for all the positive feedback about the last post with the three “words of advice” from billionaire business builder Jeff Hoffman (founding team member and former CEO Priceline.com).

Because of that I’ve decided that today I’m going to share with you something else that Jeff taught when he was a guest advisor at a recent workshop–the six best ways you can protect your business from being vulnerable.

One:   Get Educated

The education we’re talking about here is not academic education, but rather practical advice and input from actual business owners who live day in, day out in the real world of business.

How do they find their customers?   What technology do they use to hold their business systems?   Hold do they scale with limited resources?   Where did they get their funding?   What mistakes did they make and what did they learn?   How would they do it different if they were starting all over again today?

The answers to questions like these can best be learned by listening to business owners who have done it before themselves, ideally multiple times.   This is the backbone on which the Maui community is built – success leaves clues and successful business owners can teach you out of their experience.

Two:   Find a Mentor(s)

Can you find or create a deeper relationship with a seasoned, successful business mentor who has a real commitment to helping you grow and succeed with your business?

This can be someone local in your area or halfway around the country you speak with via phone a few times a month.   The key is that you both build a relationship so that he or she gets to know you and your business and has an emotional stake in seeing you succeed.

Three: Upgrade Your Peer Group

Character is contagious, be careful who’s character you catch!

Unfortunately the world we live in is full of people who are resigned… Resigned to live less than they want.   Resigned to accept a business that is not what they really want.   Resigned to just slog it out, day after day.

To reach your business goals you need to be around an upgraded peer group of other business owners who like you are committed to stretching and playing big.

Four:   Get Into a Mastermind Team

Building your business in isolation is dangerous.   It’s too easy to let your bias push you into rash mistakes.

We need other people who can be the “circuit breaker” to stop us from making poor decisions… Who can be the catalyst for holding us accountable for our goals…   who can spark us with outside perspective and fresh ideas.

This is precisely the role of your mastermind team.

Five:   Follow a Better Road Map

Most business owners are building their business day after day as a way to earn a living for their family.   They look at their business as a way to generate active income to support their lifestyle.

While there is nothing wrong with this, the most successful business owners see their business as a way to build something of value beyond just themselves.   They know that by building their business in such a way that it is independent of themselves, they are both building an asset that has scalable value AND they are able to create more value for the market.

You’ve read about our model for building a business (i.e. Level One, Level Two, Level Three).   What matters most is that you build your business with a bigger picture sense of where you want to end up (an Advanced Stage Level Two or Level Three business) rather than just following the masses and get stuck in the Self Employment TrapTM.

Six:   Have a Concrete Plan

Your road map is your big picture strategy and model.   Your action plan is how you translate that strategy and model into concrete action.   This is where your quarter by quarter action plan comes into play.

Each quarter you’ll identify your top three strategic objectives, and the action steps and milestones to accomplish them (or a substep to them) that quarter.

The power of your quarterly plan comes from two things.   First, it forces you to narrow your focus on fewer, better things.   Remember, doing a few things better and to completion will almost always outperform spreading yourself too thin on too many conflicting priorities that you only half do.

Second, your quarterly plan will take the guess work out of what you need to accomplish each week.   You’ll have a clear timeline to follow that gives you the mile markers along the way to reach your quarterly targets.

Free Business Bestseller!


Build a Business, Not a Job: How to Build Your Business to Sell, Scale, or Own Passively

Get your copy of this 176-page classic from Wall Street Journal Best Selling author David Finkel.
Or for more information on growing your business visit David on the web at: www.MauiMastermind.com

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The 6 Key Risks to Any Buyer of Your Business

by David Finkel on February 10, 2011

Have you ever thought about selling your business? Ever dreamed of what it might mean for you?

Today I wanted to share with you the 6 key risks from a BUYER’s perspective so that you can take steps now to mitigate these risks and make your business more valuable.

1. Management team: How talented are the managers? Will they stay? What happens if one or more leave? Who will lead the enterprise as a whole?

2. Reliance on owner: Will this business work well without you (the owner) around? Which customers rely on your personal relationship to keep them happy? What banking relationships are based on your personal financials or rapport with a specific banker?

3. Truth and accuracy of financial records: Are your financial records clean and up to date? Have your financials been audited by outside firms? Are there any warning flags like discrepancies between corporate tax returns, filings, or investor reporting and the company financials?

4. Customer base (concentration and future prospects): Are the customer relationships with the company or with the owner? Is any one customer so big that the business would suffer if that customer’s orders diminished or went away altogether? What are the future prospects for your key customers? Your industry? Your specific business?

5. Competition: Where does your company stand in the marketplace compared to your competitors? How will you assure your prospective buyer that sales and market share can grow, not just be maintained?

6. Industry future: What trends affect your industry? What potential disruptors could kill your industry overnight? What contingencies do you have for these scenarios?

The bottom-line question is this: “Are you taking action to mitigate as many perceived buyer risks as possible over the next two to three years before you sell?

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Maui Advisor Bill Shopoff on Self Directed IRAs and the Recent Tax Law Changes

by David Finkel on November 9, 2010

I wanted to get you this link to an article that Maui Advisor Bill Shopoff wrote on self directed IRAs and the recent tax law changes.

Bill, who has personally done over $1 BILLION in real estate deals, shares how and when to convert to ROTH IRAs versus standard IRA.   And he has a cool strategy to “back door” your way into a ROTH no matter your income level (but you have to do it SOON!)

Here is the link:

http://www.shopoff.com/article_detail.php?ID=77

My favorite part of the article is the “multigenerational wealth tool” ideas he shares.   I never really thought of a Roth IRA as an estate planning tool before he mentioned it in his blog.
Enjoy the article.

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Bottom Lines to Focus on in Your Business

by David Finkel on November 4, 2010

I’m really excited–tomorrow morning I fly out with my family to Maui for the 2010 Maui Mastermind Wealth Summit event.

In my prep for the event, one of the things that really came clear for me was how important it is to focus in your business on the things that make the REAL difference, and not allow the urgent fires or demands grab all your attention.

Today I’m going to do my best to succinctly “bottom line” the most important focuses for your business at each Stage and Level of its development.  

Before I do that I wanted to encourage you to get a complimentary copy of our newest book, Build a Business Not a Job: How to Build Your Business to Sell, Scale, or Own Passively.

This short book (176-pages) is full of hundreds of ideas for you to apply to make your business more successful AND less dependent on you the owner.

The reason we are giving  readers a free copy is because we’ve learned over the past 10 years of doing this business that most of our best clients originally decided to work with us because of the demonstrated value of one of our books or weekend workshops.

Here is the link to get your complimentary copy of the book:

www.Mauimastermind.com/custom/freebook  


I hope you enjoy it!  

Now on to the “bottom lines” in your business…
The Bottom Lines to Focus on In Your Business

Level One:   4 things you MUST do…
1.      Clarify your business concept and do your market research.

2.      Create your draft business plan.

3.      Test market your offer so you get REAL feedback from people in your market.

4.      LAUNCH!  

Early Stage Level Two: Sell, sell, sell, sell.  

All kidding aside, if you’ve got an Early Stage Level Two business, no need doing fancy systems or planning 5 years down the road.   You’ve got to make those early sales that ensure you have the cash flow to survive!

Beyond this early selling, you need to start building rudimentary (i.e. rough and incomplete) systems to generate leads, close sales, collect your money, and fulfill on your promises.   (See below.)

Middle Stage Level Two:   Build out your core system(s) in four areas:

Now that your selling regularly and you know your business has a regular sales stream, it’s time to go back to the 4 core systems and improve them into your “baseline” system for each area.

Here are the four core systems:
1.      Lead generation (so you have a baseline system for reliably generating a minimum level of leads).

2.      Lead conversion (so you have a baseline system for reliably converting your leads into paying customers.)

3.      Fulfillment or production of your core product or service.

4.      Your accounts receivable system to collect on the money you’re owed.

Advanced Stage Level Two:   Finish fleshing out your systems, controls, and winning management team.   This is the time you’re scaling your business and you need these building blocks to do it well.

Ask yourself, “What is the single greatest limiting factor to my business’s growth currently?” and then apply yourself to push back that limiting factor.

In addition, you need to start building out your management team too.  

Level Three:   Deciding, planning, and executing on your exit strategy… whether that be to sell, to own your business passively, or to scale it much larger.

These are the bottom lines by Level and Stage.   Don’t make things overly complicated.   Building a business is a known equation.   You don’t have to reinvent the wheel.

Focus on what’s most important to your business at your current stage and level of development.   Let the other future focuses go for now and laser in on what matters most.

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Top 7 Insights from Last Night’s Investing Webinar

by David Finkel on June 19, 2009

Last night was an amazing online workshop – thank you again Bill!   Also, thank you all forthe feedback you shared, I’m appreciative that it was so well received.

What I wanted to do today was share my personal insights from the session with Bill.

For those of you who missed out, I’ve made arrangements to post the replay of the online workshop (all 75 minutes of it) through next Wednesday when it will be taken down off the site.

Click Here To Watch the Replay

Insight #1:   While you may have taken a hit on your asset values, the money you have now to invest will go a LOT further. In other words, assets are still on sale.   Bill shared on the webinar how he was able to buy back one of the projects he sold to a developer for 25 cents on the dollar.   But for a word of caution, see insight 2.

Insight #2:   Just because the price went down doesn’t mean the asset is a good buy. Now is a time to be very picky and cherry pick the best assets at the best prices.   This requires that you get very good at determining the real value of an investment so that you know if it really is a good buy or not.

Insight #3:   Going to be some real bargains coming up in world of commercial real estate and some major “pain” as commercial values are going to continue to take a hit (lack of financing, dropping rental values and cash flow, increasing vacancy factors…)   Commercial real estate market has NOT bottomed out yet.

Insight #4:   Residential markets in many areas HAVE approached bottom. (Impossible to call it exact, and very location specific, but Bill made a compelling case last night as to some of the markets he is following, and why he sees them at or close to bottom.)

Insight #5:   Bill’s most memorable line from the call, “I’ve paid millions for my education!” Meaning he’s taken some MILLION DOLLAR LUMPS over the past 24 months.   Why in the world would he jump to a new niche when he’s just paid for those lessons?   Now is the time for you to INVEST your lessons in your niche investment vehicle and turn your lessons/pain into profits for yourself.

Insight #6: Your real seed to invest are your Advantages. Let your Advantages guide your investments.

Insight #7:   Another very memorable quote Bill said, “If the deal can’t afford some lawyering, then you can’t afford the deal.” GREAT bit of advice.   Don’t be cheap on your documenting and contracting in your investment deals… You’ll pay a hundred times more in the long run to be cheap.

This is my short list of personal insights from Bill.   What about those of you who attended, what were your best insights?   Please add your thoughts for the rest of us to learn from.

And for those of you who want to listen to a guy who in one 5 year stretch made himself and his investors $145 million in profits, I strongly suggest you listen to the online workshop replay and take very good notes!

Click Here To Watch the Replay

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3 Biggest reasons traditional financial advice is so dangerous to your financial future

by David Finkel on May 15, 2009

Hi everyone.
I’m doing my final prep for teaching on how to intelligently manage and invest your net worth for maximum wealth.   Just sat reading through my notes on traditional investments pushed on most individuals and I noticed i started getting a little bit angry.

Hence I thought I’d “blog it out” and share my 3 biggest reasons why I hold traditional financial advice to be so potentially dangerous:

1)   Most financial advisors are really securities dealers with NO fiduciary responsibilty to you.   They only have to give you advice to investments that are “suitable” and that standard is just not acceptable to me.
LESSON:   make sure you ask, in writing, if they are a fiduciary role for you or not… that term matters… it has legal force.

2) For those of you who invest in securities (think stocks/bonds/mutual funds), study after study show that Index funds held over long term and NOT actively traded will outperform over 80+% of the actively managed funds for total returns over the long term… If you are going to use this vehicle (and personally I’m a commercial real estate and business guy so I don’t, not where my personal advantages are) why would you go any other way?

LESSON: if you are going to invest in securities, then appropriate LOW COST index fund (i.e. expense ratio under .3 percent) is the way to go… and DON’T actively trade it!

3) “Stocks… Bonds… Other…” and the myth of diversification.   I do not believe that you manage investment risk by investing in a huge cross section of areas… I think the best way to manage risk is to educate yourself and cultivate investing advantages… this requires you t oFOCUS not diversify.   You can’t be great in all areas, choose the area that best meets your goals, your Advantages, and your current starting point.   Then out of strength you can choose to broaden your niche over time.   In the interim, 1-2 index funds gives you plenty of diversification if you want to just take the average market returns (and DON’T just take this unless you have a LONG — think 10+ years– window to needing your money.)

LESSON:   Invest in yourself.   If you asked me, David I have $20,000 where should I invest it?”   My simple answer would be for you to take 5-10k of it and over 12-24 months invest it in your financial,business, and wealth education.   This means getting the books, taking the classes and workshops, and going through the home study courses.   This is one investment that to ignore could cost millions…

Thanks for listening… I feel a bit better.

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Who’s In Your Millionaire Club?

by David Finkel on January 27, 2009

We’re talking about a principle here, not an organization for you to join. The principle is simple: in every walk of life, including wealth building, we can do more together than we can alone. If you won’t take my word for it, let me call in some higher authority:


 â€œTwo are better than one, because together they can work more effectively.
If one of them falls down, the other can help him up…  Two people can resist an attack that would defeat one person alone.  A rope made of three chords is hard to break.”  Ecclesiastes 4:4  

Or closer to home, the wealthiest man of his time, Andrew Carnegie:

“No man is smart enough to project his influences very far into the world without the friendly cooperation of other men. Drive this thought home in every way you can for it is sufficient unto itself to open the door to success in the higher brackets of individual achievement.”  

So the concept of the Millionaire Club is really that your journey to wealth begins with the connections you make. Surround yourself with a mindset of poverty, and you will stay poor. Conversely, surround yourself with dynamic, creative people who refuse to surrender to any obstacle, and you will find yourself swept towards your dreams — on a current stronger than yourself. Here’s how I put the principle in my own words:

 â€œWe learn to know who we are inside of the social mirror of our peers.
One of the most powerful decisions we can ever make is to consciously
Choose who our peer group is going to be based on the person
We consistently are when we are in their company.”

Look around and ask yourself: who is in my Millionaire Club today? And who would I like to see there? By asking — and living — these questions, you will immediately understand what Maui Mastermind  is all about.

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