10 Rules for Getting Rich: Insights from a Successful Entrepreneur

Rule #1: You Don't Need to Be Smart to Get Rich

Many people believe that becoming wealthy requires exceptional intelligence or an elite education. However, the reality is quite different. Success in accumulating wealth has more to do with understanding the rules of the money game than having a high IQ.

Here are some key points to remember:

• Making money is a game with specific rules
• You need to work hard, be patient, and use common sense
• Being too intelligent can sometimes be a disadvantage
• Smart people often see too many risks and miss opportunities
• Focus on making smart choices and sticking with them long-term

The Power of Persistence

One entrepreneur shared a pivotal moment in their journey:

"I remember attending a meetup event in 2016 when I was struggling with my first business. A speaker who seemed rather unintelligent boasted about making $400,000 per month. That moment changed everything for me. I realized that if he could do it, so could I."

This experience highlights an important truth: success in business and wealth-building often comes down to understanding the game and playing it well, rather than raw intelligence.

Embracing Opportunities

Interestingly, being less risk-averse can sometimes be an advantage in the pursuit of wealth. As our entrepreneur noted:

"Not being highly intelligent can actually be an advantage when it comes to making money because you'll take opportunities that others won't."

This willingness to seize opportunities, combined with hard work and sound decision-making, can be a powerful formula for financial success.

Rule #2: Saving Money Won't Make You Rich, But It Gives You Security to Take Risks

While saving money is important, it's not the primary path to wealth. Instead, savings provide a crucial foundation that allows you to take calculated risks in pursuit of greater wealth.

The Power of Financial Security

Our entrepreneur shared a personal experience:

"When I first started making money with my company, I was excited but overshadowed by debt and lack of savings. The first thing I did was pay off all my debt. Then, I created what I call an 'oh fund' - enough money to cover bills, living expenses, and start from scratch if needed."

This financial cushion had a profound impact:

"The moment I put that money aside, it unlocked a new layer of creativity. I could now focus on building the business without worrying about paying bills."

Investing in Growth

With this security in place, the entrepreneur was able to make significant investments:

• $4 million into starting another company
• $3 million into developing a software company

These investments might not have been possible without the peace of mind provided by savings.

Creating Space for Risk-Taking

The key takeaway is that savings create a space for taking calculated risks. As our entrepreneur put it:

"It's not about living below your means; it's about creating the means to take risks."

While savings alone won't make you wealthy, they provide the security needed to pursue opportunities that can lead to significant wealth creation.

Rule #3: You Make No Money for a Significant Period, Then You Make All the Money at Once

Wealth creation often follows a non-linear path. Many entrepreneurs experience long periods of little to no income before suddenly seeing explosive growth.

The Reality of Building a Business

Our entrepreneur shared their experience:

"The first 2 years of building my business, I didn't just not make money - I lost money. Then one day, I made a ton of money."

This pattern is common in entrepreneurship and wealth-building. It's not about getting lucky, but rather about persisting through the challenging early stages.

The Dunning-Kruger Effect in Business

The entrepreneur referenced the Dunning-Kruger effect to explain this phenomenon:

1. People overestimate their ability at first
2. They quickly realize it's hard and they're not as skilled as they thought
3. If they persist, they eventually improve
4. One day, they've accumulated enough skills to see significant rewards

The Power of Skill Accumulation

"During that period when I felt terrible, that's when I accumulated all the skills to make money that nobody and nothing can ever take from me," the entrepreneur explained.

This highlights the importance of viewing the challenging early stages as a crucial learning period. The skills developed during this time are what ultimately lead to success.

Exponential Growth

The nature of exponential growth means that results often appear suddenly after a long period of seeming stagnation:

"We went from zero to $7 million in six months, and from zero to $27 million in two and a half years."

Lessons from Successful Entrepreneurs

Even highly successful business people often face long periods without seeing financial rewards:

"Did you know that Howard Schultz didn't make any money from Starbucks for 17 years? He at one point had to borrow money from the guy who made the boxes for the shoes to pay payroll."

The Importance of Delayed Gratification

The ability to delay gratification is crucial for long-term success:

"The reason a lot of people don't make a lot of money is because they don't know how to delay gratification. The reason I know that I will make a billion dollars is because I know that I can delay gratification."

Rule #4: Money Always Chases the Best

True financial success comes from focusing on excellence rather than chasing money directly. When you become exceptional at what you do, money naturally follows.

The Journey to Excellence

Our entrepreneur shared their experience as a personal trainer:

"I had a mentor who told me, 'Focus on being the best and forget the rest.' So I asked myself, how can I build up evidence that I'm the best?"

This led to actions like signing up for fitness competitions to demonstrate expertise and results.

The Result of Becoming the Best

"From doing those things and becoming so good, I couldn't even take on the amount of people that came to me."

This experience illustrates a crucial principle: when you focus on being the best, people notice, and financial success follows.

Value Creation and Financial Reward

"Money is attracted to value, and excellence in any field creates value that people are willing to pay a lot of money for."

The entrepreneur used the example of a celebrity personal trainer versus a trainer at a local gym. The one who has demonstrated exceptional results with high-profile clients can command much higher fees.

Finding Your Niche

"Find a game that you can be number one at... I only know that I can be number one at something when I'm obsessed with it."

This advice encourages focusing on areas where you have both passion and potential for excellence.

Rule #5: Learn How to Make Money While You're Awake Before Trying to Make Money While You Sleep

Many people are attracted to the idea of passive income, but it's crucial to master active income generation first.

The Pitfalls of Chasing Passive Income Too Soon

The entrepreneur shared a personal story about investing in real estate prematurely:

"We buy this rinky-dink house... This house was more work than I could have ever imagined. They didn't tell me I'm going to have to manage tenants, I was liable for all these things happening with the home."

This experience cost time, energy, and $20,000 to resolve.

The Skills Required for Passive Income

"Investing itself is a skill... There are more transferable skills from learning how to actively make money into passively making money than there are passively into actively."

This insight highlights the importance of developing fundamental business and money-making skills before attempting to create passive income streams.

Active Skills for Passive Rewards

"Even passive income requires skills. There's no way to make money or compound your money that doesn't require some level of skill."

The entrepreneur emphasized that seemingly passive investments often require active learning and effort, especially in the beginning.

Warren Buffett's Wisdom

"Warren Buffett said this: before you can let money work for you, you have to put in the work yourself. Active learning and effort come first, passive rewards come later."

This quote from one of the world's most successful investors underscores the importance of mastering active income generation before pursuing passive strategies.

Rule #6: If Money is the Only Goal, You Will Never Have Enough

Pursuing wealth solely for its own sake often leads to dissatisfaction. It's crucial to have a deeper purpose for accumulating wealth.

The Empty Victory of Wealth Without Purpose

The entrepreneur shared a personal experience after selling their first company:

"I remember the moment where the big check hit my bank account... I felt nothing. I didn't even feel super excited. If anything, I felt relief because I was done with the process."

This moment of realization led to an important insight:

"What I realized is that if money is the goal, you just never have enough."

Money as a Tool, Not an End Goal

"Money is only a tool that you can use to then get other things."

This perspective shift is crucial. Instead of focusing solely on accumulating wealth, it's important to consider what you want to achieve with that wealth.

The Importance of Having a Vision

The entrepreneur's next thought after the sale was: "What am I going to do with this money? What am I going to use it to build?"

This led to the creation of a new venture, giving purpose and meaning to the wealth they had accumulated.

The Danger of Money as a Master

"Money is a great servant but is not a great master. Because as long as it's your master, you will never have enough of it."

This insight highlights the importance of maintaining a healthy relationship with money, viewing it as a means to an end rather than an end in itself.

Finding Fulfillment Through Process, Not Outcome

"I want to build an amazing business. A consequence of that is that I make money. That money is useful in building an amazing business."

By focusing on the process of building something meaningful, wealth becomes a byproduct rather than the primary goal.

The True Source of Happiness in Wealth Creation

"In building my business and accumulating all this money, I did not get happier having more money. I got happier through the process of who I became to create value that created money."

This profound realization emphasizes the importance of personal growth and value creation in the journey to wealth.

Rule #7: If You Have No Money, You Should Have No Shame

Many people remain in poverty because they're too ashamed to do the work necessary to become wealthy. Overcoming this shame is crucial for financial success.

Embracing Humble Beginnings

The entrepreneur shared a personal story from their time as a hike guide:

"I remember there was this guy, and he was pretty out of shape... He looks at me and says, 'You know what, I'm just really grateful that we have people like you in this world.' He's like, 'Yeah, people that are willing to do the work that you're doing. I could never do what you're doing.'"

Instead of feeling ashamed, the entrepreneur saw this as an opportunity:

"In that moment, I thought to myself, 'Dude, I'm willing to do this work because one day I will be richer than you.'"

The Value of Doing Unglamorous Work

"Those who are willing to do the work - it's not sexy work, but it is work, and it will move you along, and it will make you money, and it will progress you - those people will also expose themselves to more opportunities than anybody else."

This insight highlights how being willing to do work that others might consider beneath them can lead to unexpected opportunities and growth.

Overcoming Poverty Through Action

The entrepreneur referenced a famous saying:

"Poverty is not a disgrace, but not striving to overcome it is."

This emphasizes the importance of taking action to improve one's financial situation, regardless of starting point.

No Job is Beneath You

"If you're not rich, there is nothing beneath you when it comes to making money and when it comes to doing what you've got to do to create a stepping stone to the next thing."

This mindset allows for taking advantage of any opportunity that presents itself, no matter how small it might seem.

The Shame of Inaction

"There's no shame in being broke, and there's no shame in doing grunt work. But there is shame in not trying to change your circumstances."

This powerful statement encourages taking responsibility for one's financial situation and actively working to improve it.

Rule #8: Counting Other People's Money Won't Make You More

Focusing on how much money others have or make is a distraction from your own wealth-building journey.

The Futility of Comparison

The entrepreneur posed a thought-provoking question:

"Does counting someone else's reps in the gym make you more buff? No. So then why would counting somebody else's money make you more rich?"

This analogy effectively illustrates how focusing on others' wealth does nothing to increase your own.

A Costly Lesson in Deal-Making

The entrepreneur shared a personal story about losing a valuable deal due to concerns about how much the other party would make:

"We can't do this deal like this. If we sell for the target that we have, he's going to make $500 million... That's not fair."

This focus on the other party's potential gain led to walking away from a deal that aligned with their own targets. In hindsight, this was recognized as a mistake:

"I have watched that company over the last 4 years essentially 10x in value. They've been incredibly successful."

The Mindset of Wealth

"People who don't have money are constantly focused on how much everyone else has... That is not how wealthy people think because they know that focusing on someone else's pockets does not fill their own."

This insight highlights a crucial difference in mindset between those who accumulate wealth and those who don't.

The Benefits of Others' Success

"They also know that there's a lot of benefits to people around you and other people having a lot of money, and that it's not some scarce resource that you need to have more of than every single person around you."

This perspective recognizes that wealth creation is not a zero-sum game and that others' success can create opportunities for everyone.

Focus on Your Own Growth

"If you're trying to make more money and if you want to become wealthy, stop looking at other people's money."

This advice encourages redirecting energy from comparison to personal growth and wealth creation.

The Best Deals Benefit Everyone

"The best deals are when each person feels like they got the better end of the deal."

This insight promotes a win-win approach to business and wealth creation, rather than always trying to come out on top at others' expense.

Rule #9: You Don't Need to Change Your Beliefs to Make More Money, But You Do Have to Change Your Behavior

Many people mistakenly believe that changing their mindset alone will lead to wealth. However, it's changes in behavior that truly drive financial success.

The Myth of Manifesting Wealth

The entrepreneur shared a personal experience of trying to "manifest" wealth:

"I heard all these people talking about like, 'You have to manifest the money, and you've got to see it before you get it.' I read this book... It specifically said I need to act as though money is in abundance and I need to act as if I'm already rich in order to get more money."

This led to behaviors like giving away groceries and donating money, which didn't lead to increased wealth.

The Reality of Wealth Creation

A pivotal moment came when the entrepreneur's partner said:

"Money doesn't discriminate who puts in the work to make it."

This insight shifted the focus from changing beliefs to changing actions:

"What if I didn't try and change the way I think, and I just change what I'm doing every day?"

Action Over Intention

"The road to success - you get there by working hard. You don't get there with intention. You get there by doing it."

This emphasizes the importance of taking concrete steps towards financial goals, rather than just thinking about them.

The Power of Action Regardless of Belief

"I promise you that if you go out there and you do the same things as a person who made a million dollars, you will make a million dollars, even if you don't believe you're worthy of it."

This powerful statement highlights how actions can lead to results, even when beliefs haven't caught up.

Personal Experience of Action-Driven Success

"I didn't believe in myself, and I didn't believe that it was possible for me to make that kind of money. I didn't believe it was possible for me to make hundreds of millions of dollars. Never believed it once, never thought it was possible ahead of time. And here I am - I just took action like somebody who could."

This personal testimony underscores how taking action can lead to success, even in the absence of strong self-belief.

Getting Out of Your Head

The entrepreneur quoted Tony Robbins:

"Stay in your head, you're dead. Nothing good comes from staying in our heads. Get out of your mind and get into life and start taking action like somebody who could make money."

This advice encourages moving from overthinking to taking concrete steps towards financial goals.

Rule #10: The Amount of Money You Make is Directly Correlated with the Difficulty of the Problem You Solve

The final rule emphasizes the connection between the value you create and the wealth you accumulate. Solving more difficult or important problems typically leads to greater financial rewards.

The Elon Musk Principle

The entrepreneur referenced Elon Musk's approach:

"If you want to make more money, provide more value by solving harder problems."

This principle is exemplified by Musk's companies like Tesla and SpaceX, which tackle significant global challenges.

A Tale of Two Products

The entrepreneur shared a story about a friend who had two ventures:

1. A software company for SMS chat
2. A revolutionary protein bar

While the software company had moderate success, the protein bar business exploded because it solved a more significant problem in a unique way:

"It didn't taste like a protein bar, and it didn't have whey protein in it... The problem that it was solving is a problem that no other protein bars in the market had solved."

The Correlation Between Problem Difficulty and Reward

"You are directly paid in proportion to the difficulty of the problem that you solve."

This insight explains why some ventures are more financially rewarding than others, even within the same industry.

Personal Growth and Problem-Solving

The entrepreneur shared their own journey of tackling increasingly complex problems:

1. Teaching individuals how to lose weight
2. Selling customers into gyms for gym owners
3. Teaching gym owners how to get customers
4. Teaching gym owners how to build sellable gyms
5. Teaching business owners how to build sellable businesses
6. Teaching CEOs and founders how to build eight or nine-figure enterprises

"Each time what you notice is that I solved a harder problem, and each time I took a jump in solving a more complex problem or providing more value, I made exponentially more money."

The Importance of Skill Stacking

"I also wouldn't have been able to solve the really big problem if I hadn't first solved the very small problem at the beginning."

This highlights the importance of starting small and gradually building up to solving more complex problems.

The Path to Wealth

"If you solve harder problems, you make more money. But you can't skip steps. The only reason I can make the money I make now is because I have put a decade of eating shit and just time over time skill stacking, solving harder and harder problems."

This final insight emphasizes that wealth creation is a journey of continuous learning and tackling increasingly challenging problems.

In conclusion, these 10 rules provide a comprehensive framework for approaching wealth creation. They emphasize the importance of action over belief, the value of solving significant problems, and the need for persistence and continuous learning. By applying these principles, aspiring entrepreneurs can navigate the challenging but rewarding path to financial success.

Article created from: https://www.youtube.com/watch?v=LuJxo_I1iNc