Early on in my entrepreneurial journey, a lot of my friends asked me, “What’s your exit strategy?” and “When do you plan on selling your business?”
To be honest, I never thought about an “exit strategy” because my goal was to create a profitable and sustainable business that would enable me to become financially independent. In hindsight, the fact that I didn’t focus on an “exit strategy” was one of the reasons I was able to accomplish my financial goals.
If you’re a regular reader, you know that I harp a lot on the fact that most would-be entrepreneurs never even get started. My intent is not to be overly critical or negative, but to reinforce the point that for every real entrepreneur, there are dozens of aspiring entrepreneurs who never even take the first step.
Taking that first step is arguably the hardest hurdle you will have to clear as an entrepreneur. I understand all too well that doing so is easier said than done. However, I’ve discovered one simple trick to overcoming your fear, anxiety, and complacency.
One of the most frequent questions I get from friends and family is, “How much, and how hard, did you have to work to get rich and retire early?” I won’t sugarcoat this. The simple answer is, a lot. And very hard.
However, the truth is a little more nuanced than that. On the one hand, you will need to work more and harder than you ever did at your day job. On the other hand, you will be far more motivated and passionate about your ownbusiness than you ever were about working for someone else or for a corporation.
Business is full of counterintuitive axioms, and the 80/20 rule is no exception. In case you’re not already familiar with the 80/20 rule, it states that 20% of what you do is responsible for 80% of the results. The trick, of course, is to identify the important 20% and focus like a laser on that 20%.
One of the most frequent questions I get from friends and family is, “How did you decide on your number?” In other words, how much money do you really need to retire early? The vast majority of personal finance experts will give the same answer: “It depends.”
I agree with that answer but disagree with their rationale. Also, since I hate non-answers such as “it depends,” I’ll say about $1 million multiplied by the number of people in your household. In other words, get somewhat rich. More on that later.
The year was 2002, just a year after the infamous dot-com crash. I was nearing 30 years of age. I was toiling away at my desk job, going through the motions, and more than mildly discontent.
It was an okay job, the money was decent, and I was making a dent in my student loans, but another 30-plus years of the grinding, soul-sucking rat-race was a bleak and depressing prospect. And, even if I sucked it up and endured it for three to four more decades, a comfortable retirement would be far from certain.
Conventional wisdom tells aspiring entrepreneurs to first write a business plan. Makes sense, right? Although what I’m about to say might sound counterintuitive, that’s a bit like putting the cart before the horse. Here’s why.