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GOLD! How to create monetary wealth in just 5 years. (Or less!)

Philip Marlowe

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Create yourself a mathematical equation
For those who were not at the summit, MJ gave an in-depth presentation on his equation. And what I realized - which should have been obvious - is that your whole life is an equation. All your goals can break down in a similar way.

When I decided to lose weight, I looked at my equation. It was something like:

Wake-up late + skip breakfast + Dunkin Donuts + Working Lunch....

You get the idea. My equation now is:

Wake-up early + work-out first + healthy breakfast + pack a lunch...

You can do the same thing for your business goals. Are you waking-up late and trying to hustle at night when you're tired, or are you making it a priority and grinding first thing when you're free? I've already been up for 2 hours (EST) and gotten my "ONE THING" done for today. If I didn't do anything for the rest of today, it would be a success. It's an amazing feeling.

This is obviously a complete hijack of the concept, but MJ's presentation changed how I viewed all of my goals. YMMV.

-PM
 

jmusic

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The biggest mistake I see my peers do that prevent them from executing on this equation (early 20's) is they lock themselves into their job. They use their income from their 50k/yr jobs to get new cars, houses, pay their loans, and go downtown to the bars. They don't save, invest, or plan for the future.
Very much so. And of course, to make the cubicle jail cell complete, they put everything on credit. Even though I'm still a cubicle slave (for now), I try to think of every purchase in terms of how many hours of my life will be required to pay for the next gadget.
 

MJ DeMarco

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Yzn

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@MJ DeMarco

Does making videos about a certain topic on Youtube count? even though you don't CONTROL the platform?
 

James Gill

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@MJ DeMarco

Does making videos about a certain topic on Youtube count? even though you don't CONTROL the platform?
I know you have tagged MJ and wouldn't attempt to answer for him but I don't think YouTube can ever be truly Fastlane. However there are lessons you can learn from MJ's fantastic opening post that can get you closer to Fastlane. To compare to MJ's book example which I have oversimplified:

MJ creates the book and then sells on various platforms at a margin to what it cost to create and market per unit. MJ doesn't control the platforms but he does set the sale price and can negotiate/control the publishing and marketing costs to a certain extent. Like YouTube, the reach of his various platforms is worldwide so his potential audience or customer is therefore worldwide.

With YouTube, you can create as many videos (units) as you like, you can control your marketing and your production cost, and your audience has the potential to make you profit from these units indefinitely as long as the video stays live. However it is no secret while your video will stay up indefinitely, the YouTube algorithm gives it somewhat of a lifespan.

And unlike MJ you will never be able to control your sale price. Your earnings (adsense $ per view) will always be controlled by the platform and you're also unable to update your videos once they go out of date. MJ can republish updated versions of his books to ensure the information remains accurate.

To get closer to the message MJ is promoting in this thread you need to think outside the box of just creating and uploading videos.

Adding more layers of income to each unit (video) would enable you to be able to have more control over your total sale price (average $ per view). Sponsorships and affiliate deals not only add an extra layer of income but also can be negotiated. By adding more variables to your equation, not only does this get closer to Fastlane but you will create more income along the way.

Instead of (unit=video):

Monetary Wealth = unit X (total views X adsense $ per view rate)

Turn your equation into:

Monetary Wealth = unit X ((total views X adsense $ per view rate)+(sponsorship value)+(total views X average affiliate conversion per viewer) X affiliate $ per conversion rate))

I might be off with the brackets there but I hope you see what I mean.

This isn't totally Fastlane, you won't be able to release one or two videos and live off of the proceeds while doing minimal maintenance work, you need to keep creating units, marketing them etc. But there are certainly actions you can take to become less Slowlane.
 

Yzn

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I know you have tagged MJ and wouldn't attempt to answer for him but I don't think YouTube can ever be truly Fastlane. However there are lessons you can learn from MJ's fantastic opening post that can get you closer to Fastlane. To compare to MJ's book example which I have oversimplified:

MJ creates the book and then sells on various platforms at a margin to what it cost to create and market per unit. MJ doesn't control the platforms but he does set the sale price and can negotiate/control the publishing and marketing costs to a certain extent. Like YouTube, the reach of his various platforms is worldwide so his potential audience or customer is therefore worldwide.

With YouTube, you can create as many videos (units) as you like, you can control your marketing and your production cost, and your audience has the potential to make you profit from these units indefinitely as long as the video stays live. However it is no secret while your video will stay up indefinitely, the YouTube algorithm gives it somewhat of a lifespan.

And unlike MJ you will never be able to control your sale price. Your earnings (adsense $ per view) will always be controlled by the platform and you're also unable to update your videos once they go out of date. MJ can republish updated versions of his books to ensure the information remains accurate.

To get closer to the message MJ is promoting in this thread you need to think outside the box of just creating and uploading videos.

Adding more layers of income to each unit (video) would enable you to be able to have more control over your total sale price (average $ per view). Sponsorships and affiliate deals not only add an extra layer of income but also can be negotiated. By adding more variables to your equation, not only does this get closer to Fastlane but you will create more income along the way.

Instead of (unit=video):

Monetary Wealth = unit X (total views X adsense $ per view rate)

Turn your equation into:

Monetary Wealth = unit X ((total views X adsense $ per view rate)+(sponsorship value)+(total views X average affiliate conversion per viewer) X affiliate $ per conversion rate))

I might be off with the brackets there but I hope you see what I mean.

This isn't totally Fastlane, you won't be able to release one or two videos and live off of the proceeds while doing minimal maintenance work, you need to keep creating units, marketing them etc. But there are certainly actions you can take to become less Slowlane.
Great reply.
 

MJ DeMarco

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Does making videos about a certain topic on Youtube count? even though you don't CONTROL the platform?
YouTube is a channel to reach an audience. As is Amazon. These are channels. They don't wholly represent my business, they are pieces of the business.
 

Envision

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Very much so. And of course, to make the cubicle jail cell complete, they put everything on credit. Even though I'm still a cubicle slave (for now), I try to think of every purchase in terms of how many hours of my life will be required to pay for the next gadget.
Credit isnt bad in all cases. You dont start out rich so I understand having to do what you have to do. Hell, i have debt but I have a method of getting rid of it and I have a reason for it. Im not unconsciously piling on debt without tracking it. Credit is fine, just be aware of what you are doing.
 
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Roughneck

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Oct 14, 2018
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As someone who has only just started reading unscripted, learning to change mindset about hyper-realities. This has really set in. Starting to view the world differently.

Everyone scripted is focused on that hourly rate or annual salary. I even found myself excited to see the "3%" pay increase thinking 'awesome, that's above inflation'.

These equations, simple equation I might add, make so much sense. Saved this post so I can come back to it again.

Sent from my Pixel 2 using Tapatalk
 

Roughneck

Contributor
Oct 14, 2018
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Sometimes debt is a necessary evil in alot of cases, like you said - having a game plan to reduce and eliminate is the key.
Credit isnt bad in all cases. You dont start out rich so I understand having to do what you have to do. Hell, i have debt but I have a method of getting rid of it and I have a reason for it. Im not unconsciously piling on debt without tracking it. Credit is fine, just be aware of what you are doing.
Sent from my Pixel 2 using Tapatalk
 

NMdad

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Instead of trying to scale time (more debt to earn a better education to earn a better paying job under an annual salary regime) start scaling units— units separate from your time.
Holy moly, the simplicity of this is astounding.

It's been a while since I read TMF, and I know time can't be scaled. But focusing on scaling UNITS--that's the key to the puzzle. I knew that, but seeing it as an equation compared to wage-earner equations--that's the red pill.

Probability is another piece of the puzzle, and I think it's often either ignored or glossed over. For example, some people make an assumption: "If I could capture 10% of the market..." instead of making a reality-based assessment: "If A & B & C are true, then X is likely."

Probability lets you compare opportunities so you can choose what to focus on. For example, does X opportunity have a 1% or 80% probability? Very different. Does X opportunity have the (reality-based) potential to scale to 10x or 100x more units compared to Y opportunity? And what variables can you control that could increase the probability?

Profit margin per unit is another piece. Can I make $.01, $1.00, or $1,000 per unit, taking into account the probability of selling X units?

Having an equation is inescapable. But we have the choice to determine what it looks like.
 

MJ DeMarco

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Probability lets you compare opportunities so you can choose what to focus on. For example, does X opportunity have a 1% or 80% probability? Very different. Does X opportunity have the (reality-based) potential to scale to 10x or 100x more units compared to Y opportunity? And what variables can you control that could increase the probability?
Probability based strategy is a key component to everything. Everything we do carries unseen probabilities, but they are there. Glad you caught it. ;)
 

Jonathan Hoch

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So, I just counted. 58 streams of income... Why not 60? Lazy? Just kidding, don't ban me I like my new home!
 

Surf16

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When I decided to lose weight, I looked at my equation. It was something like:

Wake-up late + skip breakfast + Dunkin Donuts + Working Lunch....

You get the idea. My equation now is:

Wake-up early + work-out first + healthy breakfast + pack a lunch...
Great idea @Philip Marlowe

I am going to create equations for some of my daily, weekly, monthly goals outside of my business equation.

Thanks!
 

MJ DeMarco

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So, I just counted. 58 streams of income... Why not 60? Lazy? Just kidding, don't ban me I like my new home!
My equation has far more variables, the "58" was an simplification of a more complex equation. ;)
 

Leo Hendrix

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Great to see you're into crypto.

Would be nice to have a legend/ brief explanation of your formula :)
 

Santiago_12

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Apr 14, 2018
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Thank you , Mj.



Asked on Quora which I answered...

https://www.quora.com/How-can-I-create-massive-monetary-success-in-five-years/answer/MJ-DeMarco-1

Create yourself a mathematical equation that scales, then work that equation to death while acting, assessing, and adjusting along the way.

Few people understand that all of our actions and career decisions implicitly tie us into an equation.

This equation can be relatively simple or extremely complex.

At the end of the day, it will be your self-directed EQUATION that determines how much wealth you can (or cannot) accumulate.
  • Equations that scale make their owners rich.
  • Equations that do not, make their owners slaves to the system of “trading time for money.”
The beauty of this equation is that you can control its basic variable parameters. But most people DO NOT because most people don’t even know this equation exists!

If you decide to get a job at McDonalds and are paid $12/hour — congratulations, you just created yourself an equation to which you are now bound to:

Monetary Wealth = (rate of pay) x (hours worked)

If you work 30 hours, your equation is 12 X 30, which equals $360.

If you go to college and accumulate $140K in debt so you can have the privilege of earning $40K/year, congratulations, that’s your new equation.

Monetary Wealth = (hourly salary) X (years worked)

To complicate the mix, you are then suggested to save your money and give it to Wall Street.

There you get another equation:

Monetary Wealth = Market investments X annual ROI

This mainstream advice is the standard prescription for mediocrity.

And it’s clearly not a method to create monetary success in less than 10 years, much less 5.

As you can see, the problem with “trading your time for money” or “Wall-Street” as a conduit to wealth is that the variables are extremely limited and uncontrollable. You cannot work 3,000 hours at McDonalds in one week. You cannot force McDonalds to pay you $1,000 per hour. You cannot ask Wall Street to give you a 4000% return.

There are only so many hours in a day, and years in a life.

And herein lies the lie behind college: Young people are told to go to college so they can increase their PER HOUR rate from $12 to, say, $25 or $30. Or if they go into more technical fields (STEM stuff) they get away from hourly to annual pay. Now instead of making $50/hour, they make $50,000/year.

The problem remains.

TIME CANNOT BE SCALED.

You cannot work 1000 hours in day.

You cannot live to be 500 years old.

You cannot ask Wall Street to give you a 4000% return in one year.

You cannot ask your employer to give you a raise from 50K/year, to $500K.

Your hands are tied because the equation you’ve given yourself SUCKS.

Instead of trying to scale time (more debt to earn a better education to earn a better paying job under an annual salary regime) start scaling units— units separate from your time.

This means you become a creator of relative value.

Creators produce products, services, books, information, inventions, it doesn’t matter so as long as:
  • A) Your creation can eventually become separate from your time.
  • B) You can scale your creation to a level that can change your life.
The other metric is relative value.

Sure your blog full of fitness tips my be valuable— but it isn’t relatively valuable because the web is filled with ‘em.

Whatever you create, it must be relatively valuable in the global pool of options. This doesn’t mean you have to be the next Steve Jobs — it just means to skew value on one or two attributes; faster shipping, improved operation, better logistics, better service, better UI, better this, better that.

Entrepreneurship is about improving, more so than inventing the next hot thing.

So let’s assume you invent a cool new widget that appeals to women who are mothers.

Your equation now becomes:

Wealth = Widget Profit X Widgets Sold.

This is where things change.

Now you can SCALE a part of your equation. There are billions of mothers on the planet. Additionally, you control your widget operations and can fiddle with pricing, sourcing, and other operations integral to your widget.

So if you sell 100,000 widgets at $5 profit each, you just earned $500,000.

If a IG influencer raves about your product in IG and you get a rush of traffic for 1 week, selling 4,000 units, you make $20K in week.

Your ceiling for wealth can be influenced by your execution, marketing, and decision-making. You cannot do this under a “time trade” regime.

This is how you create wealth beyond the BS preached in the mainstream (get a job, save your money, invest with Wall Street for 50 years blah blah)

Of course I’m not suggesting this is easy.

The key is to change the equation, change the probability, and change your potential outcomes. Nothing is easy, but neither is getting up at 6AM, fighting traffic for 50 years, and retiring with a gold watch on 50% of your income.

Just to give you an example, how this works in real life, I’ve been “off the clock” for over 20 years. That means I earn money 24 hours a day, 7 days a week because my income and net worth is tied to UNITS, not HOURS or TIME. This is how can effectively call myself “semi-retired”.

I’m a best selling author [The Millionaire Fastlane] and [Unscripted] (published in over 15+ countries/languages) so part of my “equation” is how many books that sell worldwide.

And when you move to a “unit” metric, your markets expand beyond your local city — so what not appeal locally, might appeal globally. For instance, my second book Unscripted is a the #1 best-selling business book in South Korea (at least that’s why my publisher is telling me) but barely known in the states.

I also run a global community on entrepreneurship [The Fastlane Entrepreneur Forum] which operates 24 hours a day. A 24 hour operation means I earn 24 hours a day. I could go on and on with the other ventures but hopefully you get the point…

So are you ready?

Here’s my SIMPLIFIED equation for wealth currently. (Actually it’s much larger but I think you get the picture.)

(bup)(bs1)(bc1) + (bup)(bs1)(bc2) + (bup)(bs1)(bc3) + (bup)(bs1)(bc1) +(bup)(bs1)(bc4) + (bup)(bs1)(bc5) + (bup)(bs1)(bc6) + (bup)(bs1)(bc7) +(bup)(bs1)(bc8) + (bup)(bs1)(bc9) + (bup)(bs1)(bc10) + (bup)(bs1)(bc11) +(roy1)(bs1) + (roy2)(bs1) + (roy3)(bs1) + (roy5)(bs1) + (roy6)(bs1) + (roy7)(bs1) + (roy8)(bs1) + (roy9)(bs1) + (roy10)(bs1) + (roy11)(bs1) + (roy12)(bs1) + (roy2)(bs2) + (roy2)(bs2) + (roy2)(bs2) + (bup)(bs2)(bc1) + (bup)(bs2)(bc3) + (bup)(bs4)(bc2) + (bup)(bs5)(bc2) + (bup)(bs2)(bc6) + (bup)(bs2)(bc2) + (bup)(bs2)(bc2) + (bup)(bs2)(bc10) + (bup)(bs2)(bc2) + (wt)(webconv)(ad1) + (wt)(webconv)(ad2) + (wt)(webconv)(ad3) + (webtraffic)(insconv)(insfee) + (inv1)(roi1) + (inv2)(roi2) + (inv3)(roi3)+(inv4)(roi4) +(inv4)(roi5) + (inv5)(roi4) + (inv5)(roi5) + (inv5)(roi5) + (inv6)(roi6) + (res)(avg-app) + val(biz1)(pe) + val(biz2)(pe) + val(biz3)(pe) + altcoins(value) + altcoins(value) + altcoins(value) + altcoins(value) + btc(value) + eth(value) + …​

Most of those variables listed above I can CONTROL and SCALE.

1) Create relative value.

2) Recognize your equation.

3) Work the equation.

4) Act — Assess — Adjust

5) Repeat​

That my friend is how you create monetary wealth within 5 years.
anank
 

MJ DeMarco

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NAVEN23

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Apr 3, 2019
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Holy moly, the simplicity of this is astounding.

It's been a while since I read TMF, and I know time can't be scaled. But focusing on scaling UNITS--that's the key to the puzzle. I knew that, but seeing it as an equation compared to wage-earner equations--that's the red pill.

Probability is another piece of the puzzle, and I think it's often either ignored or glossed over. For example, some people make an assumption: "If I could capture 10% of the market..." instead of making a reality-based assessment: "If A & B & C are true, then X is likely."

Probability lets you compare opportunities so you can choose what to focus on. For example, does X opportunity have a 1% or 80% probability? Very different. Does X opportunity have the (reality-based) potential to scale to 10x or 100x more units compared to Y opportunity? And what variables can you control that could increase the probability?

Profit margin per unit is another piece. Can I make $.01, $1.00, or $1,000 per unit, taking into account the probability of selling X units?

Having an equation is inescapable. But we have the choice to determine what it looks like.
Where can I learn more about this probability ?
 

Matt Hunt

Contributor
May 9, 2019
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Seeing how I'm now 37 years old, and have tons of student loan debt still to pay off, yeah... the whole 50 years of compound interest definitely isn't gonna work for me! I never really liked the idea, anyway. For years I've felt that the process of getting enough to retire on is too slow. I gotta figure out a faster way. I'm not gonna work 80 hours a week... I'll burn out and quite possibly end up in an insane asylum. I could increase my income, but only in small increments. The amount of time it takes off the Slowlane equation to retirement is too small.

I call my previous plan the middle lane. Invest half my earnings in multi-family real estate (much better returns than Wall Street). It's not a terrible plan, and could get me to a modest retirement in roughly 10 years.

But 10 years is still a long time to slave away at a job! I can't see myself doing that. Gotta build up a Fastlane business that can buy me freedom within the next few years!
 

fishgodeep

Contributor
Read Millionaire Fastlane
Oct 11, 2015
35
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Edmonton
I feel like I was napping in class only to wake up while @MJ DeMarco was saying exactly what I needed to hear. Thank you.

Recently I've started 'doing well' as a wage slave earning ~$3k/week in a job where I have a lot of free time. Currently writing this post while at work, been here 5 hours and literally haven't done anything except read.

Ironically, I've been able to 'move up' into this position at work because (among other things) this forum. I've applied a lot of the aspects of an entrepreneurial mindset to my career i.e. taking responsibility for everything, going the extra mile, showing up early and staying late, seeing every failure as an opportunity to learn etc.

Most people I feel would be happy to make $150k/year while doing little. But to me it still feels like prison. The only difference is now they've moved me to a much nicer cell where the bed is soft and the food is good. But I'm still in a cage. I'm still trading time (a finite unit) for money (an infinite unit).

My equation is better but it still sucks. Thank you for the reminder and helping me shift my focus. I'm not going to lie like a lot of others on here and say I'm going take action right now! #worktillmyeyesbleed #serialentrepreneur.

The truth is I'm not really an entrepreneur. otherwise I'd be doing it not reading threads on how to do it. But what I do possess is an immigrant mentality. I work harder because I feel I must work harder. There is great great strength is being the underdog.

Anyway, thanks for writing this and my apologies for the rant. I guess it was on my mind for some time now lol.

To summarize I don't know how I'll escape from my cell but I will escape.
 

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