What is it that really differentiates entrepreneurs from others? It's not about his ingenuity, imagination, ability to predict trends or believe in his own ideas, according to a recent article in Quartz. It's the silver spoon bite they were born with. The most common trait among entrepreneurs is access to financial capital, notes the article, which cites a wide range of research. The Israeli study found that even those who scored lower on mathematical achievement tests but who came from a family with higher income and wealth were more likely to become entrepreneurs.
There are many entrepreneurs who have created incredible businesses, saved very little along the way, and then collected a fortune. If you are a doctor, employee or successful salaried, then the concepts I discuss in my book are not that relevant and while you can certainly invest and divide your assets into three equal groups, cash, stocks and real estate, the reason for an entrepreneur to have a third of your cash wealth is very different from that of a traditional non-businessman investor. As an entrepreneur, you need to stop thinking of yourself as the creator and owner of a business and you should start thinking of yourself as a creator of business wealth. A common objection I hear from entrepreneurs is that they are too busy building their business to bother learning and investing in real estate.
Fubu is a great company that demonstrates the good things that can happen when entrepreneurs don't fit perfectly into the mold of Silicon Valley. If you think that won't affect your chances of success, ask the non-white businessmen, not men and not young people who have been there. Many people think that before it was easier to accumulate wealth as a self-made entrepreneur and that most wealthy people today inherited their wealth. In my book, I suggested that an alternative option to owning real estate is to own a REIT (real estate investment trust), and although a REIT is an excellent investment vehicle, it is not good enough for entrepreneurs who are in control, type A and who are in control.
That's why, he argues, I've been a successful businessman for most of my life, and despite trying, he has never done it. Most of the people in the annual Forbes 400 ranking of the richest Americans are also self-made entrepreneurs. I have had several conversations with several entrepreneurs over the past few months who just realized that they should have spent more time investing outside of their business. If you're an entrepreneur who wants to create wealth and learn how to get rich, then it's not enough just to rely on your business to make a fortune.
The same thinking applies with regard to creating business wealth: don't just invest IN your business, also invest OUTSIDE your business.