Thread: HOW did you jump from 6 to 7-8-9 figures...?

Originally Posted by ITA

(MJ I hope you also go over this big time in your book - I suspect I'm not the only one curious about this process.)

Very good question.

I do mention this in the book; its called "Rapid Wealth Acceleration" -- its the stage when your revenues (and hopefully profits) experience an exponential growth vs linear growth. One month you're making $12,000/mo and the next its at $20,000. It's very easy to go multi-millionaire status when you're earning $200,000/mo.

The key to witnessing RWA in your business? Have a chance.

Be engaged in a business that can exponentiate/scale -- I did a video about this. The guy who buys a sub franchise is not in a business that can exponentiate very easily -- one day he isn't going to wake up and his $42,000/year sandwich shop will suddenly be making $890,000/year .... unless he buys more franchises. That's why in general, I recommend selling franchises, not buying them. The best venues for exponentiating business are web business, authoring, and inventing.

My RWA experience was very much like this ... one year I was earning $10K/mo, then the next it was $50K/mo, then $100K/mo, then eclipsed at $200K/mo.

The second part of the process is to sell your asset(s) and accelerate your cash flow into one lump sum. If you build a business that cash flows, it becomes worth X times earnings. A $300K/year business might be worth $2M.

In all these big success stories, the conduit to wealth is always something that scaled well to serve the masses.

MJ's plan/outline of accelerating wealth is a great one. Developing something that can be scaled up/automated can lead to big, big paydays.

We're not in the mega-millions category, but we have transitioned from being worth low six figures, to mid, then high six figs, then over a million, and now a few million.

And like SteveO, we've done this by repeating our "One Trick Pony"-- learning how to do something well, then getting bigger and bigger ventures with it.

And I think that's where the "6 figure to 7 figure" guys (and the 10M to 50M deals) are, for many. You choose a "one trick pony" that has both big deals and smaller deals. Learn lots on the smaller deals, and progress to the bigger ones.

Another important thing to mention here is motivation: We are motivated by the challenge, and the fun of doing this. It is much less about money that you would think! I'd venture to guess that folks who do this for money slow down/stop when they have "enough" to live comfortably*. So that would explain why folks stop when they get to a mil, or 2, or even to $500K*.

Again, MJ's route is much more dynamic, and has a much bigger payoff. But you can still make millions the slow and steady way-- and be a multi-millionaire in less than 10 years.

-Russ H.

*If you own your house and car free and clear, and have no children/dependents, $500K invested in 5% T-bills gives you about $2000 per month-- which is lots when you don't have to go to work, buy gas or work clothes, etc. Remember-- if you put that $500K in a 5% interest bearing investment, the $500K just stays (you don't spend any of it). You just live off the interest ($25K/year). Want more? Make more: $2,000,000 x 5% = $100,000 income per year, just on the interest alone.

Originally Posted by ITA

@MJ: I heard of franchise owners making millions though...owning 7 or 8 McDonalds can build some solid wealth apparently.

Of course, you ask about the best franchise out there ... McDonalds ... a franchise with a built-in fail-safe, but what about the 1000's of others? There are some great "top-tier" franchises out there (McDonalds is #1 if you are lucky enough to be awarded one and have the hefty $$ for the fee) but below the top-tier, are 1000's of others that are nothing more than buying a job.

The point is ... the franchise SELLER always makes more than the franchise BUYER - and it don't matter what brand it is. The Seller is the entrepreneur, the Buyer is more of an operator and/or manager.

If was to buy any franchise, I'd be doing it for the sole purpose of replication -- not operation.

Wow, what a thread to view on a sick-day, where I am still contemplating my future at the j-o-b

Originally Posted by SteveO

Sorry to burst any bubbles but I actually made less when I quit my job. The rapid rise of the equity in the properties and the resulting cashflow were the primary drivers of income growth.

it is interesting to see that many of the success stories on here come from a strong working background where making that "leap of faith" has extreme risks- having a family and mid to high 5 figure/low 6 figure household income is difficult to give up, especially in this economy. At the same time it seems like that's the "carrot" that most employers hold out to keep top-tier talent under their control.

In my situation, the "carrot" is the strong possibility of 6 figures within 2-3 yrs, but in the meantime a laughable $25k base pay with little to no commission in the first 6-12 months makes it easy to give up what I've got to pursue an opportunity with more flexibility.

The risk at the moment is actually stronger if I stay where I'm at, as I am being groomed for a "career" and really what I need is a "job"- just to pay the bills and allow for the most valuable assets- time, energy and flexibility to devote towards my own personal ventures. Instead of having to commit 50+ hrs/wk towards something that may or may not pay off in 2-3yrs.

Originally Posted by fanocks2003

As a franchisee you are supposed to just follow the laid out formula and never complain. Paint by numbers and be happy (it's like school all over again).

See above- while I see a lot of business skills in my current position, it feels very much like a franchisee where I am forced to conform to THEIR standards and not question the status-quo. One example of this micro-management is the emphasis on "effort numbers" which is a combo of outbound calls, talk time and quotes, something that has made me more of a glorified telemarketer than a true sales-professional

What I learned from B&P and even my own experience as a franchisee in the small business I ran is, if you're good enough to run a franchise, you're better off running the whole business. Otherwise you waste that valuable resource known as time and don't learn from the mistakes/failures that it has taken many a successful entrepreneur to strengthen themselves towards their 6/7/8 figure net-worths

Keep in mind that the successful franchises such as McD's, Jimmy Johns, etc come with a hefty startup cost($655k-$1.25m for McD's and $229k-$368k for JJ's) and as MJ mentioned they are selective towards who they award the franchises to in the first place, meaning you have jump through hoops and usually sign agreements to open 5-10 new locations within a certain time frame, basically keeping you bound to the franchise.

Your not counting the knowledge and experiance which is where most of the real value is.

I'm speaking from the RE side because thats what I know, but at first its hard because you lack a good pipeline for deals and capital, also knowledge and experiance.

Its actualy a very simple concept, you start by making a little on smaller deals and roll them into bigger more profitable ones. As your knowledge and experaince grow you can help the process along through partnerships and leverage. You can't do one without the other because you need the capital you made from your first deals to buy into the bigger ones. Really their isn't much difference between a $100k, $1m, or $10m deal other than some zeros. They do get more complex but the basics are all similer.

Start working at it; its not something that can be explained, you have to start doing it to understand.