Lessons Learned From Losing a Million Dollars
Image credit: Peter Gerdes | Flickr
Reaching that first million, keeping that first million and continuing to make more money afterwards isn’t easy. At 28, I, Joshua B. Lee, had a spendable $1 million in my bank account -- and spend I did. I bought expensive watches and fancy cars, because I hadn’t adjusted my mindset to prepare for and be a good steward of that amount of money. I quickly blew through the cash.
When you aren’t bred from birth to be ready for seven figures and beyond, maybe it’s a lesson you can only learn by experience. But I prefer to be a little naïve and share with you my lessons so hopefully you don’t have to repeat my mistakes.
Making and keeping more than $1 million requires you to focus on key strategies. These strategies include preemptively adjusting your mindset, becoming good at spotting trends, providing old-school customer service and making strategic alliances.
1. Adjust your mindset and perceptions.
Before you make that first million, ask yourself what you’ll do with it once you have it. You’ll desire to buy some new toys once you see that 1 and six 0’s in your bank account. This is why it’s so important to adjust your mindset beforehand and have a plan for what percentage you’ll spend, save and invest.
Envision how you’ll scale yourself. Build a plan your research shows can yield more than $1 million, because nothing in life goes exactly according to plan. Halfway to reaching your goal, start implementing your money plan. For the percentage you invest, will it all be invested in your company or other investments also?
As you get about 80 percent of the way there, re-evaluate what you really want, because the situation changes after you earn your first seven figures. My mind wasn’t prepared the first time around, so I quickly spent and lost my first million.
2. Develop an always-on opportunity radar.
Keep your eyes peeled and your ear to the ground for the next opportunity to expand your company. Where’s the money, where’s the next revolution, where’s everything moving toward? Continue to hone your skills at more quickly figuring out who has the background, budget and willingness to buy from you or help expand your company.
Too many people get caught up in the long-term opportunities sacrificing everything today. I’m willing to sacrifice 30 percent or 50 percent today for the bigger long-term opportunity but I won’t sacrifice 90 percent. Getting some money today is important for your mindset. It’s important for your well-being and continued ability to stay in the arena and keep fighting, to borrow a metaphor from Teddy Roosevelt.
3. Develop a spotting-trends radar.
Where is the money flowing? How do we find the money? Pay attention to social media, economic shifts, hot new trends and what’s in. One mutually beneficial way I do this is by mentoring young entrepreneurs. I observe new trends they’re high on. They benefit from my business experience. If you choose this path, your mentoring benefits them and their trendiness can be invaluable to you.
4. Practice old-school customer service.
Always look at the bigger picture to improve your business. Take care of your customer’s needs, answer their questions and provide human support for them. Legendary customer service is rare these days so it’s a neglected way you can stand out above your competitors.
Allow people to understand who you are. Work with integrity. Respond to their questions quickly and efficiently so they’re confident that’s how you do business and will continue to do so in the future. They’ll keep spending their hard earned money with you because of this. This is one thing I did get right throughout my entrepreneurial journey.
5. Create strategic alliances.
It’s much easier to work with fewer people who pay you less than a ton of people who pay you more. Ally with people who support you and have your back, those who don’t let money be the sole driver of the relationship. The way to earn trust and deepen these relationships is through mutual respect. Identifying and creating strategic alliances is another thing my company has done well from the start.
6. Build smart.
The final thing that fostered my success was my intention to build a quick and nimble company that could adapt in this crazy, fast-paced modern world. I sought mentors who had already achieved what I was looking to do and followed their advice. Remember, knowledge isn’t power. Applied knowledge is power.
Next, foster a culture in your team that encourages failure because you’re reaching for big ideas. Learn from those failures and emphasize to each of your team members that the main goal is co-creating opportunities together. This builds trust that you’ll have their back during tough times and they’ll do the same for you.
Remember to act with integrity while capitalizing on where money is flowing. Invest in yourself and your team, because making $1 million or more is a team sport. Adjust your mindset so you’ll be ready for the big dollars. Plan how you’re going to use that first million to continue your growth and your company’s growth. Finally, enact a plan your research shows can yield more than $1 million, then you won’t be disappointed if you fall a little short.