An Open Letter to My Grandchildren
THE SUCCESS MARGIN
Tuesday, February 3, 2004
In this issue I share some information, ideas and
recommendations I'm sending to my grandchildren.
I feel the concepts apply to everyone, especially
parents and aspiring entrepreneurs. Indeed, as a
teenager I wish someone had given me even a part
of this message.
To My Dear Brittany and Alex,
At your ages, 13 and 15, in the next few years you
will both be making important career decisions.
My purpose in writing you today is to provide you
some alternatives you may not have thought about
I'm going to propose you look closely at a career
choice which is most probably not being discussed
or offered in school.
The career choice I'd like you to ponder is that of an
entrepreneur. This involves going into business for
Why do I suggest this option?
1. Conventional schooling is geared toward training
you primarily as an employee, working for someone
The emphasis is on getting a "good" formal education
and getting a "good" job. This means exchanging
time for money. Forever.
While this can be a good choice for many people, it
may not be for you.
2. Your own expressed desires.
In the past when I’ve asked Alex what he'd like to
do when he finishes school, he's stated: "I'd like
to earn a lot of money and live a lifestyle just
Please clearly understand that the only way you
can become wealthy is as an entrepreneur.
People who have a job (employees) almost never
become rich. They simply exchange their time
for money. Therefore, their income potential
is extremely limited.
Employees tend to live all their lives paycheck to
paycheck even as managers, directors and
professionals. This means they seldom accumulate
As an employee member of the "middle class," here
is what you can expect financially according to
At age 65, after over 40 years of work, the average
savings and income-producing assets of people in
the U.S. are less than $7,000. This amount of money
would last only a couple of months.
Please understand. Money is certainly not everything
(health is far more important). But at age 65 having
almost nothing in savings in the world's richest
country is really pathetic.
Here is the sad truth. The middle class is exactly
like the poor in one major respect. Neither
accumulates any real assets. Indeed, the vast
majority are less than three months from being
completely broke and even homeless.
** How the Rich are Different **
Wealthy people have money work for them.
The rich have income-producing assets. These
include stocks, bonds, and real estate.
But the number one asset of virtually all rich
people are income-producing businesses.
While some businesses can grow very large, all
start as small businesses.
And contrary to popular belief, you can start many
small businesses without capital—with little or no
Conventional wisdom says being self-employed is
risky. I submit this is a myth. Of course any
course of action, including your own business,
involves some degree of risk.
However, in my view what is a far riskier career
choice than being self-employed is to be an employee.
During poor business periods, you can be laid off.
Plus, you are subject to losing your job at the whim
of your employer! Maybe he or she wants to hire
a relative to replace you. You can become
unemployed at any moment.
There doesn’t have to be a good reason for any
employee to get fired. Let me ask you this.
Does this seem like a risk-free existence to you?
Please don’t misunderstand me. I don't mean to
suggest becoming a millionaire business owner is easy.
Indeed, to be super successful requires a lot of
persistence, determination and hard work. But the
skills are all learnable. And once you master the
necessary skills, you can go as far as you want to go.
The sky is the limit.
* What does it take to be a successful entrepreneur? *
1. You must be a "self-starter" and a person of
action. Employees tend to act only when their
management "nags" them to do so.
2. You must discover how to market and sell your
product or service.
Tip: the very best way to learn sales skills is to study
3. You must become financially literate.
4. You must learn to think and act independent of
5. You must learn to take advice only from successful
6. The ancient Greeks said it best:
"Know thyself." You must make an honest assessment
of your strengths and weaknesses.
Were I you, the first question I would ask myself is this.
Am I really a self-starter?
Or do I require someone else—a teacher, a boss, my
parents—to "nag" me to perform? Be as honest as you
can possibly be.
If you are not self-motivated, I urge you to finish
school, get an advanced university degree and get
a job. Start at any level with your employer. Make
yourself invaluable. And work hard to make a
company money or help cut costs. Choose a solid,
ethical company as your employer.
Everyone is not entrepreneurial material. And
Work on becoming the most skilled employee you
can be. Become a superstar who is the most likely
to be kept on the payroll in both good and bad times.
If you want to become an entrepreneur, here is the
action plan I recommend.
1. While you are still in school, instead of part-
time jobs, work on developing income on your
own. This can take many forms, including lawn
maintenance, babysitting, newspaper route, teaching
tennis or another sport, or selling a product. There
are numerous possibilities.
2. Invest in yourself. One thing you can never
lose or have taken away from you is your
knowledge. Know-how is your best investment.
Invest what you can afford in good books and tapes.
Focus on small business skills. Information on
personal skills is also invaluable. Pursue subjects
which include building self-esteem, active listening
and building relationships, both personal and
Read as many books on sales and business as you
are able. Autobiographies of famous entrepreneurs
such as Michael Dell, John Wanamaker, and Milton
Hershey are great too.
Some of my favorite authors include
Robert Kiyosaki, Napoleon Hill, John Caples,
Robert Collier, Claude Hopkins, and David Ogilvy.
And as soon as you feel ready, (my favorite author)
Ayn Rand. You might want to read all your
Grandpaw’s books too.
3. At the college level, I recommend majoring
in Philosophy, Psychology and History. I'd also
take courses in sales, marketing, finance and
4. Study entrepreneurial courses. While a
university degree is not absolutely necessary, I'd
go as far as I could and graduate from a good
college or university. (A big name school is not
important.) The social skills alone that you can
learn in school will be of invaluable help in your
5. Hang around entrepreneurs. When you have
the opportunity to spend time with successful self-
employed people, do it. You'll learn a lot just
from their positive "can do" attitude alone.
If your school has any clubs such as DECA (an
association of marketing students) which promote
entrepreneurship, join them and become an active
6. Avoid debt. Overuse of credit keeps nearly
everyone in debt their whole lives. It's become far
too easy to "charge it" to a credit card. Interest
costs can keep you broke. And when one over
borrows against a home, monthly interest charges
can become a lifelong burden. A good rule is delay
gratification until you can pay cash.
Please be aware that if you decide to join the
world of entrepreneurs, I will help you all I can.
But, the decision of what to do with your life is
strictly your own. I will love you, help and support
you forever in whatever endeavors you pursue.
In closing, let me say that starting my first business
at age 21 and founding and selling 23 others, while
having lots of setbacks, has been a fantastic and
exciting journey for me.
And it's given me a lifestyle others only dream of.
You, too, can achieve a lifestyle of your dreams
having a business of your own.
Small business owners create more jobs and wealth
than do big businesses. I consider entrepreneurs
to be the undiscovered heroes of the world.
If you decide to take your own entrepreneurial
journey, I'm confident you will do fantastically
well. But knowing you, I'm also sure you will
do great things in anything you choose to do.
With all my love,
I sincerely hope that in sharing this very personal
letter, the impact on you and your loved ones is all
that you want it to be.
Please drop me an e-mail with your experiences.
Until next time,
P.P.S. "The secret to success, in life and in
business, is to work hard at the margin.
Relentlessly. It's as powerful as compound
interest, the eighth wonder of the world.
Those little marginal extra efforts will
inevitably grow into something big."
Little things mean a lot.
"God is in the details."
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