Every time we tune into the media, we’re bombarded by the multi-billion revenue and profits of big businesses like Amazon or Google.
It tends to give you the impression that all businesses work and grow in this dollar rich environment, doesn’t it?
If so, you might be surprised to know that less than 1% of all single-person businesses make more than $1 million a year in receipts, according to the 2016 US census.
To me, that’s a depressing statistic.
In fact, it’s one of the main reasons I’m here blogging.
There are plenty of experts who talk about what it takes to be a successful entrepreneur, waxing lyrical about capital needs or business plans. Unfortunately, most of them have never built or sold a business of their own.
As far as I’m concerned, the main problem most entrepreneurs have is that they don’t think or dream big enough.
So my message to you is to dream big, then take a deep breath and breathe in even more until you think your lungs will burst…
And then dream even bigger.
Keep in mind that I say this having built and sold 3 businesses for a combined value of over $300 million. That hardly makes me Google, but then, I’ve worked entirely from home less than 5 hours a day (and the last time I wore a tie was 2003).
And, I’ve not attended or held a board meeting or advisory board or any kind of mind-numbing ‘update’ meeting for a decade.
My home office is a casita overlooking the ocean, and my only permitted visitors are my wife and two furry dogs.
I’ll take that over the billions, thank you very much.
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Years ago, I read a book called The Magic of Thinking Big by David Schwartz (also someone who has never actually started or built a commercial company).
The author wrote that if you have a group of sales people in one room and separate those who have big dreams or ideas from those with small ones, you will see the difference of their ambitions reflected in the results of their sales.
A light clicked on in my head when I read this: Most people hold themselves back because they don’t think big enough.
As an example, I started my first company thinking that I needed $90k to buy the rights to a product, so I scrambled around to get it. It was hard, but after 9 months I made it.
Then I thought we needed $2 million to bring it to the next level, so I scrambled around to get that. It felt less effort, but still took 6 months.
Then someone told me to stop thinking about myself and think like an investor. He said, ‘Right now the investor is your customer. Think of the investor’s needs.’
A 20% return on $20 million is going to make an investor very happy.
A 20% return on $90k is going to bore them to tears.
That’s the magic of thinking big, although it’s not magic at all. In reality, it’s more common sense than fantastical.
A couple of years later, an opportunity landed in my lap, but I needed $28 million and quickly. This time, I went out and borrowed over $28 million in less than a month, and didn’t do anything different… other than the fact I was now aiming big.
This is a really important message that took me a long time to assimilate.
And I’m still learning it…
Talking in terms of hundreds of millions of dollars feels fine to me today, whereas $10k used to make me nervous. But if I’m really thinking big, I should be talking in terms of billions, right?
The point I want to make is this:
Whatever capital you think you need to start your business, multiply it by at least a factor of 10.
I think you’ll find it a lot easier to raise.