Tag: Investments

Warren Buffett’s Ten Rules to Success

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Warren-Buffett-150x150By David Repka

I recently walked in to a Jimmy John’s sandwich shop to get lunch and saw a plaque on the wall with Legendary Billionaire Warren Buffet’s Ten Rules. I thought that they were so good that I wanted to share them:

1. Reinvest Your Profits. This makes sense not only in the stock market, but in a small business as well. Entrepreneurs who bleed all the profits out of a business find that they may struggle to grow the business into something larger and more valuable.

2. Be Willing to be Different. Buffet didn’t make his fortune by following the crowd. Instead, he invested when everyone else was panicked, and sold off when everyone else was buying. That strategy always beats the market. Doing what everybody else is doing – the same way they are doing it – is the recipe for becoming average. Nobody pays extra for “average”.

3. Never Suck Your Thumb. After you gather the information you need, make a decision. To Buffet, any time wasted to get to a decision is just “thumb sucking”. Success comes from immediately grabbing every opportunity that you can recognize.

4. Spell out the Deal In Advance. Your bargaining position is never stronger than before you are committed. So, advantage of that opportunity to spell out the details and specifics of any deal before you start. This is especially true when working with friends or family.

5. Watch Small Expenses. In the investment world, this translates into watching not just the returns offered by investment funds, but also the fees charged by the fund managers. This is so true in every aspect of small business and personal finance, as well.

6. Limit What You Borrow. Buffet claims to never have borrowed a significant amount of money. His advice is to remain debt-free, and then save and invest money. This is a very counter-cultural (see #2) contrast to those who preach getting rich using Other People’s Money.

7. Be Persistent. This is an advantage that the small entrepreneur has over larger, more established competitors. Persistence and ingenuity can, and often does win against large odds. If you’ve done your research, taken care of the details, watched your expenses and stayed out of debt, your success through persistence may only be a matter of time.

8. Know When to Quit. Don’t throw good money after bad. Resist the temptation to salvage a bad deal with a last-minute home run.

9. Assess the Risk. Buffet recommends thinking through both the best-case and the worst-case scenarios. This helps clarify the risks and rewards for any venture, which is critical to the decision making process.

10. Know What Success Means. Buffet doesn’t measure success in terms of dollars. As he says, “When you get to my age, you’ll measure your success in life by how many of the people you want to have love you actually do love you.” Here is wisdom.

Please drop me a line and let me know your favorite Buffettism. For more inspiration and ideas on the mindset of Self-Made Billionaires please follow DesignerBuffalo.

What is more important to get our economy back on track? Jobs or availability of capital?

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I think that this is a bit of a chicken and egg question, but I think that the answer is availability of capital. Hard for a company to expand, buy equipment, rent more space AND hire new employees if they can not get access to capital.

Since the collapse of the global financial markets in September 2008 I’ve focused my energy on building relationships with alternative capital sources (hedge funds, private equity groups & CRDs – Certified Rich Dudes). I’ve been searching for a simple, scalable, brainless program to represent and ramp up a focused pipeline. I found it!

My plan for creating a supplemental income stream in areas outside my core strength of income producing commercial real estate is to focus on the capital needs of small businesses that have been shut out from obtaining funding from traditional sources. The personal credit of many of these business owners has been decimated by the global financial meltdown. My focus is to connect people, opportunities and capital.

We are creating a small business lending platform under www.Loan4Biz.com and would love your feedback on the programs we are establishing:

  • Owner Occupied Commercial real estate loans (SBA & non-SBA funds)
  • Factoring Accounts Receivable
  • Unsecured working capital loans from $5-100,000 * (credit score from 500)
  • Unsecured working capital loans for from $50,000+  ** (credit score from 720)
  • Merchant Cash Advances against credit card receivables for companies that can not qualify for a working capital loan

My partner, Lyn Matteson, has over 25 years of experience in corporate finance with august lenders like KeyBank and Charter One bank responsible for over 250 business development officers.

Send me an e-mail or call 727-537-0330 if you see a potential strategic alliance (or if you need access to capital).

Footnotes:
* Lyn has closed 31+ unsecured working capital loans with an innovative small balance lender. Sweet spot is loans in the $25-100,000 range. Simple, one page application and logical, repeatable process. Read more: http://loan4biz.com/loans/working-capital-loans

** Must have excellent credit and strong global cash flow. This is a wealth management product with no upper limit on the loan amount.