Category — mindset

Despite the current mortgage crisis in the U.S. and the fact that homeowner equity is at its lowest point since 1945, there are wealthy people buying multi-million dollar houses. As in $49 million for a 29-room townhouse. Wow.

Personally, I don’t know anyone with that kind of money but I have known a few millionaires over the years. In my mind, owning a million dollars in property is attainable, and it’s a starting point for more wealth. (My father used that base to build up to several million in property in the 1980s, though he overextended himself and lost a lot of it.) That’s my answer to “If I had a million dollars.”

But I wouldn’t buy a single home for a million dollars. Some options:
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One of the great benefits of the Internet is that small businesses focusing on a small niche stand a chance at success. That’s because, theoretically, it’s easier for them to find customers for their niche product, compared to, say, if they had a physical storefront in some small town. Or even a big city.

If their product is aimed at a relatively obscure market, then if the entire Internet-connected world is their potential customer base, it’s much easier to find enough customers. Enough to keep the business going, whereas a bricks-and-mortar equivalent might not make it.

How Many Customers Is Enough?

How many customers do you need, then? I can’t answer that and I won’t even try. But I will answer a related question. How many satisfied customers do you need to be successful on the Internet selling your product? Answer: 1,000. Or so says Kevin Kelly [via Business Opportunities, Performancing, Chris Garrett], in discussing how an artist can capitalize on the Long Tail phenomenon online. (That is, don’t try to please everyone. Focus on those who would appreciate your work the most.) [Read more →]

Think about it for a second: we live in the successes of those that came before us. Those of us that work for other people, even on a contract or project basis, do so because they’ve already achieved some level of success. If we’re employed by a company, it’s due to the success of the founders, who in turn could build on someone else’s success before them. It’s a chain of success.

So what happens to people who fail in an endeavor - even those surrounded by other people’s successes? What’s the missing ingredient? I don’t know. I believe myself to have the characteristics of a startup entrepreneur. But even after three or four failed startups, I don’t know what was lacking. My current business is doing okay, though this online work feels less stable than the offline consulting I used to do. But in most other ways, this is more enjoyable work. And I don’t have to deal with the negative peripheral factors: traffic jams, road rage by other drivers, backstabbing colleagues, bosses with personal agendas or even no discernible modus operandi.

Maybe that’s it. Even with all the entrepreneurial characteristics, including passion for the work I used to do, if there are other factors that negate the good, and if you cannot effectively deal with them, then success is unlikely. So my new theory is that happiness breeds success. Or at least, it’s a huge plus. I’m testing that theory this year.

Thomas Robert Malthus (1766-1834), a demographer and political economist (according to Wikipedia), came up with a law of population dynamics. In a nutshell, it says that only natural causes and vice will keep populations in check. I believe that there’s another factor: the cost of oil and gas, which could start killing us if the price keeps going up.

Our societies depend so intrinsically on these fuels. Most of us are at the mercy of the $106+ per barrel of oil that was reached this week. And that cost affects pretty much everything. Our cost of living goes up significantly as a result. That includes food, the fuel we need to survive. In just two years, my weekly groceries - which I keep pretty constant for experimental reasons - have gone from about $30 to $45. That’s a 50% increase. And on top of that, the cost of the gas I need to get to the grocery store has gone up.
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The U.S. economy is in a recession, according to Warren Buffet and others. Home foreclosures were at an all-time high in the last quarter of 2007, and in some places such as parts of Florida, condos have been discounted down to 50%. If you’ve got the money and the patience, you could make a killing in real estate, buying when everyone is selling. That’s the prosperity mind, but it’s easy if you already have the money. (However, I don’t see this recession lasting long, espcially if a Democrat wins the Presidency. So if you have the money, you might consider some real estate.)