Dillon Carter

Entrepreneur, Hacker and Future Mad Scientist 🚀☕

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How Anyone Can Go From Nothing to The Top 5%

I believe anyone, from any situation or circumstance can rise to the top of the social class using a framework. We no longer have excuses, but it does take time and it isn’t easy. I know what I’m saying is a bit controversial, but stick with me for a bit and open your mind to new potential. In this post I will detail a few key frameworks and ideas that shows how anyone can join the higher class given time.

 

Knowing The Outcome

 

Before we dive into the “how to” stuff we need to do some simple math. If you don’t understand what your ideal outcome is, how do you know if you’re there?

 

First, think about retirement and what lifestyle you want. For me, I want $100,000 a year after I retire, but for this post we will stick with $400,000. Now we need to calculate how much money we need in a retirement account to yield $400,000 every single year based on interest. We assume a conservative 5% and multiply our yearly income goal by 20 (our 5%) which gives $8,000,000 in total.

 

So we need $8,000,000 to bring in $400,000 every single year and to be considered one of the wealthy elite… This is a great start as it gives us a goal.

 

Side note: I’m utilizing retirement accounts because you don’t want to worry about earning $400,000 every single year. Instead you want to protect your assets and have more freedom.

 

Take your target annual income after retirement and multiply it by 20. This is how much you need in a retirement account to live off the interest and to maintain your wealth.

 

Income Is Based On Value

 

How much you make is directly tied to the value you provide to the market. This is why a CEO of a company makes more than the Intern. Overall the solutions they provide in their roles are more valuable to the company/market through experience, knowledge, action and responsibility versus an intern or someone new to the company. This is not to say that an intern or anyone below the CEO is non valuable or lacks similar work ethics as this is simply not the case.

 

Ever notice how the guy at work who stays late and “kisses ass” gets promoted faster? He’s providing more value than everyone else.

 

From a logical standpoint, if we want to increase our income, we increase our value. This is done through going to college, personal/professional development and many more growth opportunities. The downside to working for someone else is that there is always a ceiling that stops your growth. The only step you can take at this level is to start your own company, which you will be providing more value to the market.

 

For entrepreneurs, skipping the 10+ years it takes to reach this ceiling is commonplace. Why go through all of that when you could start your own company?

 

A business is the single fastest growth vehicle for building income and wealth (there is a vast difference between the two!).

 

Starting A Business Without Money or An Idea

 

No, seriously..

 

Successful entrepreneurs understand how to minimize risk and how to effectively find (NOT create) profitable ideas.

 

You don’t need the next Facebook or Google. You need a solution to a problem that people are willing to pay you to provide. This is done using a framework called Idea Extraction.

 

Here is how it works:

 

Target a specific group of people, for this example I’ll choose Real Estate agents. I talk with 50-100 agents and ask about their most painful tasks each day, week etc… I keep diving deeper, often coming up with multiple problems to solve. I don’t want just any problem, I want their most painful problem, the problem they will beg me to solve.

 

After talking to 50-100 agents I find a common painful problem I can solve. My business idea came from people wanting a solution, NOT from myself.

 

I can solve this problem through the various business models such as; a service, physical product, informational product, software etc…

 

Side Note: I focus on software as people will pay every single month for access to the solution which gives me recurring revenue.

 

So I started with no ideas, picked a market, talked to them and find a painful problem they are willing to pay for? Yes… But the idea isn’t completely validated yet. I want them to actually prove it’s painful enough to pay for. So I ask them to.

 

If a problem is painful enough, a potential customer will pre-pay for a solution. They will actually pay for a product that doesn’t exist yet. I know this seems crazy, but I’ve done this before and it’s how risk in business is practically eliminated.

 

So instead of thinking of an idea, finding investors, wasting my savings and wasting 6+ months of my time building a product like most people do, I’ve gone directly to the market to provide more value and can start a business WITH paying customers. Most companies spend well over a year to find ONE paying customer.

 

I now have an idea (let’s assume it’s software). For some reason we assume it takes money to make money, but that simply isn’t the case. I still need a developer to build the software that solves my customers problem, but I can’t code.

 

Remember how we validated our idea by getting people to actually pay for it? This funds our development costs. This is called pre-sales or pre-selling and is done more than you realize. Just look at Kickstarter for an idea of how common this practice is.

 

So at this point I’ve extracted a painful problem for real estate agents that 50+ agents have in common, validated the idea through them actually paying for it upfront and used that money to fund the building of my product.

 

Do you think everyone has the opportunity to reach out to a group of people and find their most painful problems?

 

Achieving $400,000 and Elite Status

 

Let’s get back to our $8,000,000. This seems like a TON of money and it is, but we can’t expect to knock this out in one blow. This may take 2, 5 or even more companies to achieve and that’s ok.

 

Companies are sold every single day to investors willing to pay a multiple of either its monthly or yearly earnings. For most internet based businesses, the multiple is 20-22 times it’s monthly earnings. So if I have a small business that generates $1,000 a month, It’s value if sold is $20,000.

 

At this point we’ve already started a company WITH paying customers who pay us every single month for access to our solution. What they pay can range from $50-$5,000 a month depending on how painful the problem is, the value of your solution and the marketplace. Pricing is also determined while asking the customers what they would be willing to pay and then asking them to do so.

 

Now obviously you would want to build your business even higher in revenue than when you started and eventually you would get to a point where you would either sell the business, higher a staff (virtual assistants in the Philippines for $5/hour) to run and grow your business while you repeat this whole process talking to a brand new industry and finding more painful problems to solve.

 

Conclusion

 

This is essentially a roadmap or a framework for someone with nothing to determine what they need, find REAL problems to solve, fund their business with paying customers, automate or sell and repeat until they reach their end goal.

 

For some, they may only need $50,000 a year to travel the world and so they would need much less than our elite character needing $400,000 a year in income. I’m not saying this is easy, otherwise I wouldn’t be in this class. I would be spending my time how I saw fit, but I am saying it’s possible and is my life’s passion to accomplish.

 

I hope in this post I’ve opened your eyes to the possibilities of finance, business and being conscious about the world around you and what you can achieve.

Smartcuts Book Review

shortcutsbookshaneI was recommended the book Smartcuts by a few people and when I saw post after post about this book, I knew it would be worth the read. I’ve become more aware of my need to take notes on everything I learn. From books to podcasts. I have a specific notebook dedicated to all of these notes.

Shane Snow, the author, walks us through countless times in history where great men have completely gone against the traditional path to hack their way to the top. From presidents to programmers.

Here are the notes taken from Smartcuts:

Think in 10X terms. NOT a 10% improvement. Break it down and rebuild it for better results.

Think laterally when growing anything in your life.

Use Sinatra Style programming: Using someone else’s credibility to spring your success forward.

Most companies focus on breeding faster horses rather than building automobiles.

Companies whose aim in philanthropically large do much better in all areas than those who don’t.

SpaceX went against old-industry giants to be the first private space company ever. Now, they operate in 100X terms, not 10X terms.

Use productive laziness for success: If you only need a C to graduate a college class, but by doing so increase time to focus on important life tasks or projects, why would you work harder for an A?

Think in layers to improve upon anything in life.

Search for the least wasteful way to learn something or level up. The Effective Dose.

Rapid negative feedback is the single most important thing to ask clients and customers for. Negative is better than positive feedback.

“Sometimes the questions are complicated and the answers are simple” -Dr. Seuss

Level up before you are ready for a greater advantage.

DHH used the theory of layers within business and life to quickly level up.

Study and steal from masters for quick improvements and less waste.

Spend the shortest amount of time required to move to the next level up. NEVER take the traditional path.

What is your platform advantage?

Friday Quick Post

This week was fantastic, but not much of an update on things. I’ve been going through Ramit’s Earn1K course and it has been incredibly eye opening. I’ve been focusing on using the two qualifier method to generate very unique client profiles and ideas.

Now we are moving into creating benefits instead of features and how to really find what your potential clients/customers want. A lot of the content is geared towards quality and finding a real idea or problem that people are willing to pay you to solve. This is something I feel that a lot of people are missing lately, including myself.

We want fast results and the 4 Hour Work Week without the 4 hours of work. Instead, we need to focus on building real, high quality products that sell themselves and solve real problems.

Here are some of my notes so far:

1. Finding Your Idea:

  • Pick Your Top 5 Skills
  • Pick Your Top 5 Strengths
  • Pick Your Top 5 Interests
  • Pick Three Ideas Related Your Skills, Strengths and Interests That Have High Priority

2. Define Your Target Market:

  • Use The Two Qualifier Method – [Qualifier 1] + [Qualifier 2] who (Need Your Service)
  • Ex. Bloggers who have 1,000 subscribers who want to (generate revenue with info. products)
  • Ex. Lawn Care Business Owners with At Least 5 Employees who want to (scale their company)

Notice how specific you are being when it comes to who your target audience is. The more specific the better in this case.

3. Create Client/Customer Benefits (NOT Features!):

  • Create at least 10 client benefits or end results.
  • Don’t sell the process, but the end result
  • Ex. Personal Trainer:
    • Look Better
    • Save Time
    • Accountability
    • Lower Risk of Deseases
    • Reliability

 

So far I have focused on a few industries and client profiles while using the two qualifier method and creating client benefits. The next step is unknown as the next module is locked until next week….

My goal with this course is to come out with a framework to be used at any time in my life to extract amazing ideas and profitable businesses without the headache or guessing, but with real paying clients from the start. Not only that, but I obviously hope to come out with a business that generates at least $1,000 per month, but my aim is to generate around $3,000/Month with the idea and learn how to really scale a business and turn it into something huge.

Ramit is an incredibly high quality and legit resource to learn from.

 

What I‘m Reading

  • THE Backlinking Strategy That Works – 2014 and Beyond Edition
    In 2010, while documenting the creation of a niche site publicly here on the blog, I published a massive article called THE Backlinking Strategy that Works, and it did work – extremely well.

 

 

  • Lessons In Manliness from Fight Club – Today we’re gonna break the first rule with aplomb. Hey, everyone else does too. Though it came out a decade and a half ago, the film version of Fight Club continues to be a cultural touchstone, especially in discussions about masculinity.

 

Tool of The Week

  • Trello – Project Management Tool (Free Month of Trello Gold Just For You!)

 

Share some of your small or major wins from this past week with me in the comments!

A Life of Abundance or Scarcity?

I’ve read countless personal improvement books over the last few years and I noticed something very important; your perception of reality dictates your reality. Many authors write about living in a world of abundance.

Living in a world, or perception of the world that is unlimited resources seems grand, but I’m not sure how to feel about the subject.

Abundance can be good, but for most (including myself) this mentality can put us in a state of taking zero action. Because time, money and other valuable resources are unlimited, we tend not to make any progress because the pressure isn’t on.

The only abundant resource we should focus on is our motivation and work ethic. As I get older the more this is moving to the forefront of my mind.

Ask yourself a hard question; Are you truly living up to your potential? This means how hard you work, how bad you really want to achieve your goal etc….

When I really sat down and asked myself this question, I was appalled with the answer. I know I can do better and I need to work harder for the things I want. You need to build a fiery passion for the things you want or want to achieve.

Living in world of scarcity can be greatly beneficial. When you view your time as scarce, you begin taking more action in life.

We are consumers by nature. We spend countless hours watching tv, reading articles and listening to podcasts. The only thing in life that gets us closer towards our goal is action. Consuming content isn’t a bad thing to do. I share what I read each week publically on this site.

The trick with consuming content is to only consume content that relates directly to what you are trying to achieve. I’m not perfect and this is a work in progress for myself.

I want to hear your thoughts on abundance vs. scarcity. Do you agree or disagree and why?

 

Friday Quick Post

This week I was able to delve into Ramit Sethi’s Earn1K course which is amazing so far. He restricts how much of the course you can go through each week to limit the students from becoming overwhelmed which I agree is a fantastic idea. So far I’ve learned a crap ton; What not to do, business non-essentials and how to connect two different industries to form a fantastic idea.

The weeks seem to be going by incredibly fast which I somewhat don’t like. I know it means I’m busier than usual, but I still like to experience life in a slower pace. It just reminds me that I am getting older and have limited time  to achieve my goals. When you really understand time as a resource, you begin to turn up the heat and really get to work.

I read a crap ton this week, which I’m not particularly proud of. Here’s why; When we spend time consuming we spend less time producing. As entrepreneurs, we should spend the vast majority of our time producing something of value instead of consuming article after article.

There is nothing wrong with reading and increasing our knowledge. The issue arises when we don’t apply this new knowledge and instead put it at the back of our mind. This becomes a complete waste of time and a way to procrastinate on what we really should be doing. Hold your time valuable and only consume that which you truly believe will help you and is actionable.

What I‘m Reading

  • Hacking Elance: How To Make $23,700 Freelancing In 4 Weeks – Today’s post is a detailed breakdown on freelancing strategy by Daniel DiPiazza at Rich20Something. If you’ve ever wanted to learn how to leverage your skills to make extra money on the sideor leave your job entirely, freelancing is the perfect way to start.

 

  • Life is Like a Game. Here’s How You Master ANY Game – I swept the chess pieces to the floor and ran out. The pieces were still popping around on the ground like popcorn when I left the room where the match was being played. It was my school versus some other school. I had lost.

 

 

 

  • The Productive Sprint – In the past two weeks, I’ve written more than 45,000 words, including 10 posts for Zen Habits and Sea Change and 30 chapters in my new book. That’s a lot of writing.

 

 

 

Tool of The Week

Peak User Testing – Free User Testing Videos of Your Site!

 

Video of The Week

 

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