How to get rich, p.4
How to Get Rich, page 4
And you know what? The kids and the house and the mortgage and your retired parents and the love of your life (whether a man or a woman) and all your current responsibilities—they are not the real problem. They are either inanimate, or they love you, or they don’t love you. They will not love you less (or more) if you decide to surprise everyone around you and seize the time. As you could seize it, if you truly wished to. Then you’d show them.
Why not face the unpalatable truth? These are excuses. They are nothing but a smokescreen. An alibi. Convenient camouflage to prevent you from accepting that you will probably never be rich.
Soon, you must choose. Many people would say you have left it too late to choose. But still, you picked up this book. You’re still curious. You’re still hungry. And you know it can be done. Even better than the young and penniless and those on their way up, you know it can be done. Better still, you know how it can be done. You have helped make it happen—for someone else.
The only question is: will you dare to try? If you will, then you are one in a million. Or two million or three. Your chances are slim, but they are not impossible. My earnest advice is to get yourself a young and fearless partner with tons of stamina.
Choose him or her with care. It’s your best chance to get rich.
2
A Million to One
There are three kinds of lies.
Lies, damn lies and statistics.
—THOMAS CARLYLE, CHARTISM
“Dare not” is one thing. “Cannot” is another. Not everyone can be rich. But anyone can dare to. Somebody has to. Let’s take a look at the arithmetic relating to the odds.
By my earlier definition, only 0.000016 percent of 60 million British citizens, for example, are rich. That’s less than 1 percent of 1 percent of 1 percent of 1 percent of 1 percent of the total population. If your best friend inherited one million dollars and gave you 0.000016 of their windfall, you would receive a princely sixteen bucks. “Hey! Thanks a bunch, old chum.”
If wealth were decided by lottery, you would have sixteen chances in a million of scraping into the top thousand richest people in the UK. To reach the top fifty, you would have to do better. A lot better. Like one chance in a million, allowing that a fair percentage of the places in those leagues are taken by those who inherited their loot— or a good chunk of it, anyway.
These are not very enticing odds.
Fortunately, less and less wealth is decided by the lottery of inheritance. Only a quarter of the entries now in the Sunday Times Rich List (a list published annually by the UK’s most prestigious Sunday national newspaper) find themselves there due solely to inherited wealth. If, indeed, it is that many.
Twenty-five years ago it was a different story. Back then, nearly three-quarters of the buggers were force-fed their wealth from golden spoons. (In those days, though, there were only 200 entries on the list.) Low have the mighty fallen! And they’ll be falling further yet when another blasted nouveau riche like you, dear reader, elbows his or her way into the golden horde.
If you can, that is. Because not all of us are cut out for it. Let us explore factors likely to exclude an individual from becoming rich. This is where we sort the wolves from the does, the prey from the predator and you from a lifetime of wage slavery.
There’s health, for a start. People in poor health usually find it difficult, no matter how clever they are, to muster the stamina that becoming rich demands. In any case, when you are really poorly, the allure of wealth rapidly recedes—except as far as first-class health care is concerned. (I can attest to this from personal experience. Twice now I have survived life-threatening illnesses. Making money was not big on my list of priorities at that time. In fact, I was so far gone at one point, that I forgot to sue the bastards who were responsible. Looking back, I must have been very ill indeed!)
As always, there are exceptions. The theoretical physicist, Stephen Hawking, has been confined to a wheelchair for years with a rare and appalling disease. Yet he made a bundle with a book that very few people have ever read right through to the end. A book that has sold millions of copies, A Short History of Time. (And did you know he featured in an edition of The Simpsons ?) My hat off to you, professor.
We must also factor in disadvantage and age. Not of color, sex, race, religion, upbringing or lack of education. None of those present insuperable hurdles in a Western democracy. But mental handicap, growing senility and the physical decline of old age—none of which need be life-threatening in the short term—virtually rule out any serious accumulation of wealth, except by inheritance or winning a lottery.
So that leaves the relatively fit and those not old enough to call themselves old. Close to 40 percent of the population of the UK are either old enough to have little hope of acquiring real wealth if they have not done so already, or are too young to be able to acquire it in the short term, except by inheritance. If you fall into neither of these groups, you now have only 35,999,000 people to beat.
That equates to twenty-five chances in a million of scraping into the top thousand richest people in the country. Still daunting odds.
But, wait! There are huge chunks of the population around you who either have no desire to be rich or have chosen professions that rule them out of the race. I asked a researcher to estimate for me the total number of people working for the government in Britain. (If you can afford it, always get someone else to do the grunt work. See Chapter 13: The Joys of Delegation.) While it is theoretically possible for a civil servant to resign from their job and become a multi-millionaire (especially, apparently, if they worked for the Ministry of Defence), the number of ex-civil servants in the Sunday Times Rich List is tiny—two of them having inherited their wealth while parading in the corridors of power, and one who was rich long before he became a minister.
So what did my researcher discover? Well, the number is astonishing. Over 5 million people work for the government in the UK in one way or another and are unlikely ever to become rich. Your odds now have improved to twenty-eight chances in one million.
In the US, the stats are different, but the same basic rules apply. Fewer and fewer people enter the rich lists of America due to inherited wealth each year. And although you will have millions more people to beat to become one of the thousand richest people in the USA (for the simple reason that the population of the US is five times larger than that of the UK), there is an upside for you as an American citizen. It’s this: not only are there more opportunities to become a rich American than a rich European, the prevailing culture of America encourages you to make the attempt.
In Europe, believe it or not, there is still an unspoken social stigma attached to wealth; not only to being rich, but towards any overt attempt to become rich. I could write you a book about what lies behind this cultural idiocy, but we need to move on!
And now look around you. How many of the people you work with, the people you socialize with, the people you see in the street, do you think have dedicated themselves to getting rich, or are likely to do so anytime soon? Or have the drive or aptitude to attempt to do so? Two percent? Three percent? Five percent? Let’s take 3 percent, which I believe to be a massive overestimate, by the way. Personally I know only five acquaintances who dedicated themselves to achieving success in business in order to make themselves seriously rich. (As opposed to scores of senior managers or professionals known to me who dedicated themselves to success in their business life, but allowed others to reap the main financial rewards of their labors.)
Those five people, I might add, amount to a lot less than 3 percent of all the people whom I believe could have become rich had they wished to do so. Or had they drummed up the confidence to try.
So—3 percent of the 30-odd-million people still in the race in our British example, amounts to just under one million rivals. To reach the top thousand earners among them, all other things being equal, you have now shortened the odds to one chance in a thousand. Which is significantly better than the sixteen chances in a million we began with. Now you know what Carlyle meant by lies, damned lies and statistics.
Lastly, in any list of reasons not to get rich, we must come to philosophy and the benefits of hindsight. If I had my time again, knowing what I know today, I would dedicate myself to making just enough to live comfortably (say $60 or $80 million), as quickly as I could—hopefully by the time I was thirty-five years old. I would then cash out immediately and retire to write poetry and plant trees.
Making money was, and still is, fun, but at one time it wreaked chaos upon my private life. It blocked me from beginning to write poetry until my early fifties. It consumed my waking hours. It led me into a lifestyle of narcotics, high-class whores, drink and consolatory debauchery. As a philosopher might have put it—all the usual dreary afflictions of the seeker after wealth. These afflictions, in turn, helped to undermine my health.
But like an old, punch-drunk boxer, I couldn’t quit. I always craved just one more massive payday. One more appearance under the lights with the roar of the crowd and the stink of the sawdust and leather. One more fight. “I can take this young punk. I know I can. Just this once, so I can go out as a winner. So I can retire as the champ. Then I’ll retire. Just this last one.”
Pathetic. I should have known better. There is no such thing as a permanent champ. After all, I cowrote the first bestselling biography of Muhammad Ali back in 1974. (You’ll find it, republished as Muhammad Ali: The Glory Years on Amazon.com.) And there isn’t a single fan of Muhammad Ali who does not wish he had quit the ring several years before his failing powers made the decision for him.
It’s no excuse, but making money is a drug. Not the money itself. The making of the money. This sounds like so much hoopla, but it’s true, all the same. Nobody believed that exercise could prove addictive until science stepped in and discovered “endorphins” or whatever the damn things are called. And making money, I assure you, is a hell of a lot more of a rush than jogging.
Up to just seven years ago I was still working twelve to sixteen hours a day making money. With hundreds of millions of dollars in assets I just could not let go. Like I said, it was pathetic. Because whoever dies with the most toys doesn’t win. Real winners are people who know their limits and respect them.
Eventually I found a way out. I handed over day-to-day control of my businesses to younger and mostly smarter boys and girls. I cleaned up my personal life. I began doing what I wanted to do—not what I felt I had to do. After all, what did I have to prove? Except, perhaps, to myself.
It is possible that you will avoid such mistakes when you get rich. I hope so. One thing is for sure: “the usual afflictions” are no reason not to make the attempt. There is no reason on earth why financial success should lead to personal catastrophe. Least of all the odds.
The odds may still appear daunting, but only to those lacking sufficient guts and determination to try. If the odds of getting rich put you off, then you deserve to stay poor. Or, to put it more kindly, whether you deserve it or not, you will stay poor.
But we’re done here with reasons not to get rich. Our ends are not foretold in our beginnings. The poet was wrong there. We’re heading for our own version of The Glory Years. We’re on our way.
It’s time to concentrate on getting started. To take the first step on the long road to getting rich.
PART TWO
GETTING STARTED
3
Harnessing the Fear of Failure
Go tell the Spartans, thou who passeth by,
That here, obedient to their laws, we lie.
—JOHN DRYDEN, ON THE SPARTANS AT THERMOPYLAE
The 800-Pound Gorilla
This is the 800-pound gorilla. The King Kong of your nightmares. The reason, almost certainly, that you have not already begun to make yourself rich. He’s a big bastard, so arm wrestling is out, but he’s not quite as scary as you might think. Maybe we can bribe him with a sack of bananas? Or poison him? Or teach him to sit up and beg? Let’s see.
“Not begun until half done,” lectured John Keats gloomily in a letter to a relative nearly two hundred years ago. Keats was a sublime poet, who died when just twenty-five years old. Although he would rank well inside my own top twenty favorite writers of verse in English, perhaps in the top ten, he would have made a totally rotten entrepreneur.
I would use, instead: “Once begun—the job’s half done.” Because taking that first, irrevocable step has proved to be the most difficult part of nearly every venture I have been involved in.
In the memorable words of the American philosopher and poet Ralph Waldo Emerson:
No matter how much faculty of idle seeing a man has, the step from knowing to doing is rarely taken.
There are so many reasons not to do anything, many of them highly persuasive, especially in the mouth of a Jeremiah. And the world is full of Jeremiahs. They infest our planet. In the living room, in the pub, in the office, at the boardroom table. Everywhere you look, you will find men and women who appear to take perverse pleasure in pointing out the shriekingly obvious: that if a new venture does not succeed, it may result in failure.
Not that they will say so in so many words. It would be so much easier to overcome the bulk of their objections if they did. Instead, they trot out facts and figures, statistics and trends, charts and graphs, together with endless reminders of failures of the past, with especial emphasis on the failures of those lucky enough not to be in the room at the time. (There is rarely any mention of their own failures, in my experience.)
They will say the company or the individual does not have the resources. That it has all been tried before. That “the light isn’t worth the candle.” That outside advice is required or that an individual should seek further counsel. That the individual or company is uniquely unsuited to such an enterprise. That it is too late, or too early, for such an idea to have any chance of succeeding.
How many millions upon millions of man-hours are wasted annually, I wonder, in all this doom-mongering? Personally, I’ve had a bellyful of it.
At the last extremity, as far as most company enterprises are concerned, the Jeremiahs will call in the big guns. “We must form a committee to investigate the possibility of proceeding. That’s the answer. A committee. Who shall we choose to chair the committee?”
This is the death knell, in nine cases out of ten, for any new venture. What lies behind it is the desire to apportion blame that may accrue later as widely as possible. If a committee is formed and eventually makes its recommendations, then future blame for either action or inaction cannot be laid at any one person’s door. In business and political jargon, this nonsense is called “collective responsibility.” In common parlance, it is “covering your backside.”
“A committee is a cul-de-sac down which ideas are lured and quietly strangled,” as Sir Barnett Cocks, clerk of the House of Commons, once pointed out. Well, Sir Barnett should certainly have known. He served on enough of them. Or in the words of an anonymous American wit: “A committee is a group of the unwilling, chosen from the unfit to do the unnecessary.” Just so. And they do it so brilliantly well. Whether in a college dorm, or in the walnut-paneled boardroom of an international conglomerate, or around your own kitchen table.
Of course, there is nothing wrong with robust debate, either with others or with oneself. What is undesirable, however, is the pretense that any such debate can resolve the risks involved in advance. It cannot. All debate can do is clarify, support or contest the next step. The risks remain, however much talking is done.
It is for this reason that committees are discouraged on the battlefield. A commander may be proved wrong. He may be proved right. But prompt decisions and orders, right or wrong, are far healthier than endless debate and prevarication. This applies equally to a debate within one’s own mind. Fretting is counterproductive at any level.
And so is lack of action. Knowing that fear of failure is holding you back is a step in the right direction. But it isn’t enough, because knowing isn’t doing.
Fear of failure and the avoidance of blame, then, is what drives Jeremiahs and haunts them. To be fair, it haunts all of us. In essence, it comprises two components. The first is our natural desire to avoid letting ourselves or others down, perhaps with calamitous financial repercussions. The second is the exposure of that failure to the outside world.
The majority of you reading this now are mentally nodding in agreement. (Otherwise, why would you be reading a book called How to Get Rich?) No shame there.
Believe me, I have sat with colleagues and partners of long standing, many of them highly experienced, and listened in disbelief while they have talked themselves around and around in circles. Or figures-of -eight. Or any configuration designed to delay the agony of saying:
“OK. Let’s do it.”
Or even: “OK. Let’s forget it.”
And looking back, I have to say that I regret the majority of the times I acquiesced in shilly-shallying and a retreat to safety. I would rather have tried and failed, in most cases, than have taken the safer course that so often appears to be wiser in the abstract.
Back in the late 1970s, for example, I had a conversation with a much older man, a senior manager at the high-street retailer, W.H. Smith. W.H. Smith is a power in the magazine and newspaper industry. This old buffer was friendly and helpful toward my little publishing company. I was interested in launching a personal computer magazine. He dissuaded me, warning me over and over that “nobody would ever pay money to read monthly magazines about dinky little computers.” Several colleagues in my company agreed with him. After weeks of discussions, I abandoned my plans.
Shortly thereafter, another entrepreneur, Angelo Zgorelec, launched just such a title, called Personal Computer World. It soon exhibited all the signs of becoming a big success. Fortunately, Angelo did not have sufficient capital to promote it. In the nick of time I was able to purchase a majority stake in the magazine, which I proceeded to sell for a small fortune four years later to a large conglomerate.
