ENTREPENEURSHIP 2+2=22

By Sam J. Jacobsen

Einstein’s famous equation E=MC² to explain relativity may be likened to the entrepreneurship 2 + 2 = 22. On the surface it makes no sense. However, in an entrepreneur’s world the equation explains everything from where he came from and where he is going.

The entrepreneur identifies assets, which, when assembled represent a value far greater than the total parts. A simple example may be two or more business lots separated by different ownerships. By arranging an ownership consolidation, the new value could be a multiple of total cost.

Real wealth is seldom, if ever, the result of saving salary or commission income. The lucky one is rare. It is not as difficult as you may surmise to learn the entrepreneurial basics. First, you need to understand some essential requirements and the myths. To begin with, do you possess a deep aspiration to control your own destiny? Do you aspire to a higher standard of living? Are you of integrity and value convictions? With these basic qualities, you, too, may be an entrepreneurial candidate.

Almost every aspiring entrepreneur comes forth with the same obstacles – they don’t have enough seed money to explore their idea. It is true you need to have what I call bread and butter to service your family needs. However, money is not your first problem – it’s really the last. You can literally manufacture equity dollars from assembling asset values. The asset values are your source to borrow funds to carry out your idea to reality. There’s an old gross saying… “If you have to pay for it, it’s prostitution”. So the sophisticated entrepreneurs may acquire valuable assets without paying for it or with a minimum investment. Finally, all of the above is possible without cheating or misrepresentation. It’s simply a manner of assembling asset values.

THE DO’S AND DON’T’S

• Partnerships are by nature 99% doomed to failure. Don’t even consider it.

• Franchising generally is subterfuge for employment. You can bet your bottom dollar, in one year, you will be convinced you’re smarter and you can do it better than the franchisor. Think that over. Want a particular franchise – go to work at one for a year.

• Take an accounting course. Not to be an accountant, but to understand values and business accounting terms. This becomes the corner foundation of your entrepreneurial efforts for your benefit and your creditors.

• A good banking connection is a requisite to your success. The connection is not so much the loan institution’s good reputation, but rather the right individual loan officer. Like picking the attorney, the bank officer’s clients are the best way to identify the right person. I recall in earlier years my only bank locked me up almost 5 years on a $500 credit line. After moving my financing to an out-of-town bank, the new loan officer viewed me as having a bright future. From then on, my loan requests were promptly processed and grew to very large amounts.

• Your business and a good banker have more interests in common than you are perhaps aware. Help him appreciate that your good reputation, accounting and image are superb and, in time, he may think so much of you that financing your business becomes as simple as making a request. To a successful business, money is usually the owner’s last problem. You’re a credit diamond in the rough.

• Take a Dale Carnegie course. It’s amazing, of the number of successful executives, how many are alumni of Dale Carnegie courses.

• On attorneys – most people dislike them. Many with good reason. To be successful, you need a good attorney. Don’t pick a friend or a friend of a friend. My best advice in selecting an attorney is learning the firm’s reputation and specific clients of the attorney you are considering. Good attorneys are expensive, but very reasonable to the extent they can contribute to your future.

They are very important to you. Learn when and how to use an attorney. When an attorney attempts to give you business or financial advice, find another one. Drop any attorney or law firm that promotes their services by advertisement.

• An aspiring entrepreneur will strive to make connections in knowing the right people. More particularly those in business. The more connections you have the more value you will create with help and advice. Also, you should note connections are enhanced through affiliations, service clubs, golf, Dale Carnegie, accounting courses and seminars.