Contacting would-be VIP mentors is something most people have trouble with. The question isn’t just “how do I contact them?” but also “how should I communicate with them once I do?” I teach students how to reach the unreachables in my guest lectures at Princeton, and here is my response to a recent e-mail about the latter.
Dear Mr. Ferriss,
Hi. I took the first step towards gaining a mentor by calling [important Chairman], and he said I can call him whenever I had any more questions. I was wondering how frequently you contact your mentors. I don’t want to contact him so frequently that it consumes his time, but I don’t want him to forget about me either.
There may be no such thing as too much money, but there is certainly such a thing as too little time.
How does one of my best friends make several $100,000 USD per year as an investment banker but have less than two hours per month for his dream car, which sits gathering dust in his garage?
Let’s look at the numbers…
…when you compare modern Americans to their 1965 counterparts—people with the same family size, age, and education—the [leisure time] gains are still on the order of 4 to 8 hours a week, or something like seven extra weeks of leisure per year.
But not for everyone. About 10 percent of us are stuck in 1965, leisurewise. At the opposite extreme, 10 percent of us have gained a staggering 14 hours a week or more. (Once again, your gains are measured in comparison to a person who, in 1965, had the same characteristics that you have today.) By and large, the biggest leisure gains have gone precisely to those with the most stagnant incomes—that is, the least skilled and the least educated. And conversely, the smallest leisure gains have been concentrated among the most educated, the same group that’s had the biggest gains in income.
Aguiar and Hurst can’t explain fully that rising inequality, just as nobody can explain fully the rising inequality in income. But there are, I think, two important morals here.
First, man does not live by bread alone. Our happiness depends partly on our incomes, but also on the time we spend with our friends, our hobbies, and our favorite TV shows. So, it’s a good exercise in perspective to remember that by and large, the big winners in the income derby have been the small winners in the leisure derby, and vice versa.
Second, a certain class of pundits and politicians are quick to see any increase in income inequality as a problem that needs fixing—usually through some form of redistributive taxation. Applying the same philosophy to leisure, you could conclude that something must be done to reverse the trends of the past 40 years—say, by rounding up all those folks with extra time on their hands and putting them to (unpaid) work in the kitchens of their “less fortunate” neighbors. If you think it’s OK to redistribute income but repellent to redistribute leisure, you might want to ask yourself what—if anything—is the fundamental difference.
There were three reasons why we survived. We had no money, we had no technology, and we had no plan. Every dollar, we used very carefully.
Read that one again.
Excuses not to jump into the unknown are a dime a dozen. In the case of entrepreneurship, the “I don’t have” list — I don’t have funding, I don’t connections, etc. — is a popular write-off for inaction.
Little do most people know how often lack of resources is the ingredient that creates great companies.
It forces you to be clever, to dissect problems instead of throwing cash at them, and to innovate instead of imitating better-funded competitors.
The Florida-based PR agency Crispin Porter + Bogusky is a great example of this, as are a few little enterprises you might recognize — Microsoft and Nike come to mind — that started with less than $10,000 in funding.
There is often an inverse relationship between the amount of funding and the ultimate success of companies.
More than a few Silicon Valley angels and entrepreneurs have embraced this concept. In “VC’s New Math: Does Less = More?” from the Wall Street Journal, Peter Thiel of PayPal fame, who has invested in ventures ranging from Facebook (join the 4HWW group here, 433 people strong) to the film Thank You for Smoking, exemplifies the new breed:
His company also reflects how a new type of venture capitalist is emerging, as start-up costs for Internet companies decline sharply. Many start-ups now need a bankroll of no more than a few hundred thousand dollars to get rolling, compared with the millions of dollars required a few years ago.
Keep in mind that the hundreds of thousands still refers to funding, which can now be secured with a good idea and a little testing with rentable Amazon infrastructure that costs in the hundreds (not thousands).
How to re-evaluate your “weaknesses”?
1. Write down the positives of whatever you’ve been viewing as a negative. Don’t know anyone? You’ll be a fresh face and won’t have any strikes against you. No funding? It will force you to find the neglected options and set trends instead of following them.
I focused on blogs for The 4-Hour Workweek launch because I essentially had no other options. If I’d had a huge budget and free reign over the publisher, I can almost guarantee I would have succumbed to outside peer pressure and put the bulk into print or ineffectual PR firms. Hunger and desperation can be good things.
2. Consider the negatives of the opposites. What if you had too much funding? It would create a false sense of security and breed complacency, both of which are more fatal to a start-up than bootstrapping. It could also overexpose you before your product or service is ready. It could give investors too much influence over big decisions. Don’t assume more of something is 100% positive. It never is.
3. Look for dark horse role models. “I can’t start a company — I’m too old.” Coronel Sanders started KFC after 40. The excuse doesn’t hold up. Can’t compete in sports because of a bum leg? Sprinter Oscar Pistorius has no lower legs and is aiming for the Olympics. You? For each reason for inaction you come up with, ask: has anyone overcome these or worse circumstances to do what I want to do? The answer is: of course.
Embrace your lack of resources, your weaknesses.
Far from a handicap, these are often the pressure points that will take you the furthest… if you’re able to use them instead of excuse them.
Odds or Ends:
Just a quick note to Om Malik — get well, my good man. Dear readers, send your good vibes his way, as he just recently had a heart attack and can use the moral support.
I almost never use cash for travel or electronics. How?
There are two simple methods for leveraging credit card point systems to cover both business and personal expenses: piggybacking and recycling.
The former is strategic expensing, whereas the latter is arbitraging cash (or equivalents) and credit (or equivalents) to mass produce points.
I use piggybacking exclusively, but I’ve heard some incredible stories about recycling. Do your homework before using either.
Piggybacking is particularly effective for those who have followed the muse development in the 4HWW, which provide templates for automated sources of income that are low maintenance but can be expensive in one or both of two tactical areas: manufacturing and advertising.
Regardless of where your expenses come from, shop for providers/suppliers that are willing to accept credit cards as payment, and negotiate this upfront. Here’s one approach: “Rather than trying to negotiate you down on pricing [only after you've negotiated up what they offer you for the same price to get a better yield per dollar], I just ask that you accept payment by credit card. If you can do that, we’ll choose you over Competitor X.”
This is yet another example of a “firm offer,” and not a question, that puts you in a stronger negotiating position.
“Piggybacking” is so named because it is the use of credit cards to pay for inevitable expenses, not the use of credit cards to actively accumulate points by buying things otherwise unnecessary.
The value of any reward point system is awful — generally one cent for every dollar spent. Focus on increasing your cash-flow and the commensurate increases in normal expenses you can then pay for using select high-yield credit cards. The points then simply “piggyback” your expenses, and the full balance of all cards is paid off at the end of each month. Don’t focus on points instead of profits, just as an addition.
I recommend getting two business credit cards, always separate from your personal credit cards, with at least two separate processing companies: American Express and MasterCard/VISA.
Sign up for all of your credit cards within 48 hours to minimize the negative effect these inquiries will have on your credit score. I currently use two cards for accumulating points, which I apply primarily to travel (assume 35,000 points/dollars-spent for a domestic roundtrip and 50-75,000 points/dollars-spent for an international roundtrip): American Express Business Platinum Card:
AMEX also provides the most flexible point system, as their points can be transferred to the greatest number of other programs, such as Southwest Airlines Rewards and the OnePass Alliance (of which Continental, below, is a member airline).
The primary deficit of most airline-affiliated credit cards is their inflexibility: if you own an American Airlines card, your points can only be used on American Airlines tickets, and that is it. Screw those guys, as they will happily screw you by expiring your points and imposing related jerkiness.
AMEX, by contrast, is not only flexible but has a catalog of over 20,000 worthwhile products (including iPods and assorted electronics) for purchase directly via their website. I use this card to pay for all online pay-per-click advertising (Google, Overture/Yahoo, etc.), which in turn pays for all of my domestic travel and consumer electronics purchases. My current point balance at the time of this writing is 197,486 points.
Many businesses will not accept AMEX for payment due to its high discount (processing) rate, hence the need for a MC/VISA card. This particular Chase card is sponsored by Continental Airlines but points are applicable to the OnePass Alliance, which comprises nearly 20 airlines. It is critical that you attempt to get a card with no blackout or restricted dates that are reserved only for paying customers.
I was given 15,000 points upon signing, which left me with 35,000 points to acquire before any free international flights. I use this card to cover a minimum of $20,000 per month in manufacturing and $5,000 per month of print advertising, for an average of 6,250 points acquired per week.
This means I can get a free first-class roundtrip ticket to Japan or Brazil every eight weeks or so, particularly if I sweet talk a OnePass operator into helping me drop the miles needed, which can be done with a few sentences of playful begging. Call back until you get an operator willing to help.
One can also combine the AMEX points when needed and boost the points using recycling for an international roundtrip every four to six weeks, without any real effort other than normal business expenses (of course put on autopay) and a little well-placed charisma. My current point balance on the Continental card is 78,265 points.
Recycling and related arbitrage allows you to legally move cash from credit cards to cash-like instruments and back to credit cards, without significant fees but with all the benefits of point accumulation. There are many methods at your disposal, but the least time-intensive I’ve heard of involves a simple 1-2-3 process:
1. Set your credit card cash advance limits to $0. You don’t want any nasty surprises if the processors or banks change their policies, and cash advances are an expensive way to learn. If they ask you why, just tell them you want to protect your account against identity theft.
2. Purchase gift cards that can be used as MC/VISA debit cards. An example of such a card is the AllAccess Card. “CharterOne Mastercard Gift Cards” used to be the cult favorite, but I couldn’t find them.
3. Use the gift card to purchase a Walmart or postal money order, which is then deposited back in your bank account to pay off your credit card balance and finalize the points. There is a nominal cost per 1,000 points associated with this ($1.25 or so per $1,000 money order with the USPS), but it is a useful tactic if you don’t have the requisite cash-flow or have a deficit of a few thousand points for your desired reward.
Alternatively, you can replace steps 1 and 2 by simply purchasing traveler’s checks at a AAA agency, which is often commission-free, and then redepositing them into your bank account to pay the credit card balance. The rules and restrictions for the cards change often, so the payoff may vary, but you shouldn’t get hurt in the attempt, assuming that you have a $0 cash advance limit and pay off your balance in full at the end of each month. Again, do your homework, as things change often.
Also… play nice and tell your dear accountant about your plans so his head doesn’t explode trying to figure out what the hell is going on with your cash-flow.
Last but not least…
If you are still a few thousand points behind par and need to inflate your rewards account quickly to get an international ticket, AMEX is often happy to provide a boost in exchange for spreading the wealth.
Call AMEX and tell them that you would like to get gold cards for your family and employees (even if you have none, they don’t check). The last time I used this, I received 2,500 per referral for a maximum of five people, or 12,500 points. I signed up the three members of my family and two of my best friends, whose cards were then mailed to me, at which point I simply cut them up and tossed them in the garbage.
Each card cost me $35 each, a total of $175, but it also pushed me over the threshold and allowed me to get a $1,000+ roundtrip ticket to Brazil for nothing but points.
This last tactic is needlessly expensive if you are not on a deadline of some type, but I was rushing for a pre-Christmas relaxation trip to warmer climates in 2004. If you are similarly short on time, this can put you on a plane where you wouldn’t have enough points otherwise.
While you’re at it, can you please stick bicycle spokes in my eyes?
Bob Cramer has taken six tech companies to successful exits, IPOs or acquisitions. Here is how he negotiates family time, from “The Secret Life of a Serial CEO” in the January 2008 issue of Inc.:
“He recounts how he recently considered taking the CEO job at a database company with big potential. But the second round of interviews spilled into a schedule family vacation, and he refused to change his plans. When he returned, he learned the company had gone with someone else. He was a little surprised and disappointed but felt he had made the right decision. After all, he was just following another of his rules: ‘Never regret doing a family thing over a business thing,’ he says.”
Some people are excellent at protecting family time, but most are terrible at protecting personal time.
How would your quality of life change if you safeguarded personal time like Bob safeguards family time, even if you’re single?
Odds and Ends: More videos from Buenos Aires – Taxis and Tango
Crossing under the “obelisco” and flying across the widest avenue in South America, 9 de Julio.
This is the famous “La Viruta” tango club in Buenos Aires. It is 4am on a Sunday night (Monday morning), and these 100s of people have to work in a few hours. God, I love cities designed for night owls!