Money Quotes You’ve Never Heard But You Absolutely Need For Your Business | by Joseph Mavericks | October 2022
Words of wisdom from the greatest minds
As an entrepreneur/business owner, keeping control of your finances is paramount to the success of your business. Money may not buy happiness, but it’s what fuels the economy our world revolves around, so the better you manage it, the less trouble you’ll have.
You’ve probably read or heard a lot of money management tips. Things like saving half your salary, investing 20% in the stock market, having an emergency fund… While these are all fair points, these are things we have all heard time and time again, and they are not not always usable correctly. away (for example, many people cannot afford to save half their salary).
In this article, we’ll go over some financial advice you’ve probably never heard before that provides great insight into how money works as a business owner. For each quote, I’ve included some of my personal experience as a content creator.
“The darkest hour in a man’s life is when he sits down to plan how to make money without making it”
There have been many different phases in the “hustle community” in recent years. First of all, guys like Gary Vee or Grant Cardone started telling us that if we want to make a lot of money, we have to work 70 hours a week, not see our children, skip the weekends and wake up at 5 a.m. every day. Then, around 50-60, we may be able to enjoy the fruits of our labor, if we are lucky.
Then there was the movement of the 4-hour work week, on the other side of the spectrum. Tim Ferriss & Co started telling us that you actually don’t need to work hard, you just need to work smart. You can only work a few hours a week and still earn a lot of money. All you need is a virtual assistant and a dropshipping company.
These days, we seem to have found common ground. The pandemic has arrived and we have all had time to reflect on our mental health. YouTubers like Matt d’Avella or Joey Schweitzer (of the Better Ideas channel) remind us that chronic stress and anxiety don’t have to be part of everyday life for entrepreneurs. You can make money, get by and be happy and healthy, but it’s not easy. Most people fail and burn out.
While all of these options are different and tend at different times, they all have one thing in common: they require you to work. In this world, there is no free lunch.
I’ve always wanted to make my own money, but too often, as a young “budding entrepreneur”, I’ve been tempted by a quick fix rather than taking the time to build a viable business. Selling code on forums rather than creating an online store for it, or creating an online store for physical products but without inventory… Each time, I made a few hundred dollars and was out of breath.
Always remember that money should be earned fairly, not easily. It may take you longer to get it and you may encounter many obstacles before doing so, but it is part of the journey. No man (or woman) has ever made a decent fortune without hard work.
“It’s not what you don’t know that gets you in trouble. It’s what you know for sure that’s not the case.
When I was a teenager, every time I saw my parents paying their bills, having trouble with paperwork, or having to call the bank, I thought to myself: “It all seems like a waste of time, when I can afford it I’ll hire an accountant to take care of my money.”
Years later, my business started making enough money to pay for accounting services, so I didn’t hesitate and signed up right away. The first invoices they sent me for their services were not very expensive. I said to myself: “I hate bookkeeping, I don’t even know how to do it, so this is surely a great use of my money as it saves me time which I can spend on more content creation.”
As the company grew, my accounting fees also increased. All the while, I was sure it was worth it. Then one day I received a bill for way more than I expected. It wasn’t like I couldn’t afford it, but it was a ton of money, and now it was too late not to pay it because the job had been done. I paid the bill and cut all ties with the accounting firm. I told them I would find it on my own.
Over the next year, I taught myself the basics of accounting and do all my reporting myself. It takes me longer but it saves me a ton of money, and it’s actually not that complicated. I was 100% sure that I needed an accountant for 10 years, and it turned out that I was completely wrong. Then, as Mark Twain says, it got me in trouble and I had to pay a lot of money.
As a business owner, it is very important to keep an open mind and always be on the lookout for scenarios and situations where you could go wrong. It goes beyond running costs like accounting, it’s also about the world of tomorrow, as we’ll see with the next quote.
“Stock prices have reached what looks like a permanent high plateau”
I included this quote here because it shows the importance of thinking outside the realm of what you think is possible. Irving Fisher was one of the most respected economists of the 1900s. In 1929, when the stock market was experiencing its biggest crash in history, he could not imagine how it could rise higher than the 1929 peak. It seemed impossible for the economy to recover and then go beyond. Until the day he died in 1947, Irving Fisher probably thought he was right because the stock market did not recover to its 1929 peak until 1955:
Today the Dow Jones is up 340% from its 1929 high. Irving Fisher will never know, but he was wrong. Throughout history, there are tons of examples of companies and people who got their possible outcomes wrong and had to pay the price. In the case of Irving Fisher, it didn’t matter so much because he died before he was wrong, and he was even able to profit from the gold market rush of 1932 until the end of his life.
Kodak thought digital photography was a fad in the 2000s, so they didn’t invest in it. They were earning 11 billion dollars in 2005, now they barely earn 1 billion dollars a year and have been in constant decline for 2 decades.
Other examples include the coronavirus pandemic, the energy crisis, the 2008 subprime crisis… Very few people saw these events coming. Twenty years ago, the median home price in the United States was $179,331 (adjusted for inflation in 2020 dollars). Today it’s $336,900 and in 20 years it will probably be over $700,000. It sounds crazy, but only those who open their minds to the wildest possibilities get ahead in life. Always be on the lookout for the unthinkable as a business owner. This is the best way to identify opportunities and survive crises. As Benjamin Disraeli, former Prime Minister of the United Kingdom once said: “What we anticipate rarely happens, what we least expect usually happens.”
“Spending rises to meet income”
— Parkinson’s second law
I’ve written in the past about how companies like Snapchat have a market capitalization of $17 billion but lose hundreds of millions every month. Their CEOs receive hundreds of millions of dollars in bonuses while their company bleeds money. The goal is to pump as much money as possible into growth, reinvesting all profits, to hopefully one day become a capitalist mammoth capable of gobbling up any future competition. The problem is that probably 0.1% of companies succeed like that. It’s been the standard business model in Silicon Valley for the past 20 years, but it’s starting to falter.
I also wrote about how my CEO, who despite ending up selling his company for $30 million amid the pandemic, ran out of investor money a year prior. His company was making millions in annual recurring revenue, but between salaries, office expenses, and other expenses, we were still in the negative.
I only started making my first serious money online about 3 years ago. Since then, I have focused on expanding my business, which means reinvesting a lot of the money I earn into growth. The problem with this approach is the same as that faced by Snapchat or my CEO’s company, albeit on a smaller scale: if you’re not careful and let expenses meet income, you don’t earn a penny.
Later, I learned that it is a question of risk management. As with your personal finance, you don’t have to spend everything you earn as a business, you can create an account to keep some money aside, to reward yourself when you deserve it or just to increase the value of your business. I also always wonder if I really need something that I want to buy or not. It’s very easy to justify any purchase as a “business expense” when you’re making a lot of money from your business. A computer here, a tablet there, a new phone…
The more people earn, the more they tend to spend, but the secret to wealth is the exact opposite:
Spend less, earn more and don’t forget to enjoy the journey.