Salespeople regularly offered me lifts back in the eighties. It’s fair to say I enjoyed the banter. Their cars went faster too.
London bound, one bright weekday winter’s morning, I was hitching a lift onto the M1.
Without warning, a car was jamming on its brakes and pulling into the empty slip road ahead of me. The smart-suit in the driving seat said he could take me 60 miles. In no time we were doing 90+ in the outside lane. All was good with the world…
Money, motivation and achieving millionaire status
Proud of his shiny motor, my twenty something companion loved his job in sales. I forget what he peddled, but he was quickly talking about his money and achieving millionaire status. And he was happy to volunteer his salary too – £20k plus perks. In 1984, that was gearing up for ‘loadsamoney’.
Being 18, skint and without meaningful employment I was impressed by my flash friend. But it was his brutal honesty that really appealed. Having spent 15 minutes ‘bigging’ himself up, he then declared in a slightly depressed tone he was practically broke.
He excelled at earning money. Unfortunately, we was even better at spending the stuff.
Lessons for startups – Put yourself last
People in salaried roles are typically guaranteed a pay-check at the month-end.
However, the precarious life of the start-up means there is seldom the luxury of financial certainty. As such, managing costs is critical.
Entrepreneurs who excel at spending money typically don’t last long in the job. Fast cars, designer labels and posh restaurants undoubtedly make us feel better; but they are all unnecessary especially in the early days of running a business.
Sir Richard may now spend every sixth week on his own private island in the Caribbean, but it wasn’t always that way. For several years he lived on an old barge and drove a car that regularly ran out of petrol; such was his desire to keep money in the business where it was really needed.
It will feel counter intuitive, especially if you’re employing staff, but the secret in the early days is to put yourself last when spending money. If you look after the goose, the golden eggs stand a much better chance. It took 7 years in my first business to become the highest earner.
Does money motivate?
Many studies have been compiled that examine the question ‘What motivates entrepreneurs?’ If this is an area of particular interest you’ll find lots of scholarly research right here.
But if detailed analysis doesn’t float your barge and you want more definitive answers from practising entrepreneurs, then the following film will appeal. This production called ‘Shine’ is a collaborative project from BIZNIK.com involving over 400 entrepreneurs who gathered in Seattle to share their views about starting a business.
Achieving millionaire status is not a pursuit of wealth
You’ll see their work goes way beyond the sound-bite with many interviewees talking honestly and frankly about their personal journey. The evidence strongly suggests entrepreneurs are motivated by such things as people, ideas, following dreams, making a difference, creativity and achievement. Peoples’ stories do not chime with the linear construct that starts with wanting to make money.
If you want to understand this thinking more deeply and learn first-hand how people make money, I suggest you read ‘Shoedog’. This honest, in depth and very frank autobiography by Phil Knight reveals the journey’s real truths. If you are wondering who the heck Phil Knight is, he’s the guy behind the Nike brand (thanks must go to my entrepreneurial nephew Kevin, who recommended the book to me).
So when it comes to achieving millionaire status, successful entrepreneurs it seems are patient, unselfish and self-disciplined. Moreover, they are motivated by deeper needs and are able to defer reward rather than seek instant gratification (a subject worthy of its own HHGE blog). This attitude of mind makes businesses more sustainable over the long term and ultimately, as a bi-product, also makes the entrepreneur far richer.
Key Learning Points: Careful cost management is essential for any start-up. Entrepreneurs who are prudent with their own spending in the early days and are motivated by deeper needs, are more likely to be financially successful in the long-term. By contrast, those that see money and achieving millionaire status as a linear idea are far less likely to achieve their dream.