If it doesn’t kill you, it will make you better.
Never give up.
— Rafael Badziag @BillionairePal #BillionDollarGoldNuggets
Suffering is for Mohed an indispensable element of success. “There is no success without suffering. You have to suffer to succeed.”
And you need to follow through despite adversity.
It’s the same with writing books. How many heads of the companies read economic books? Not all of them.
What’s the percentage of these who read books on the economy, read novels? It’s not a huge percentage, maybe 10%, 20%.
How many of those write something about the economy? You find another percentage. Small.
How many of these write novels, literature? It’s near zero.
But Mohed Altrad, in addition to becoming the world’s best entrepreneur in 2015, became an acclaimed author. He wrote several books on business and the economy and five novels. His autobiographical novel Badawi won several literary awards and became obligatory reading in many French schools.
There is no success without suffering. You have to suffer to succeed.
— Mohed Altrad #BillionDollarGoldNuggets
Know When to Hold and When to Fold
Often in business and life you are faced with the following dilemma:
What to do if the road to your goal is paved with failures? When to give up and when to hold on?
First, realize that every successful company almost failed at some point. So if you believe in the project, don’t give up.
Naveen Jain gave me the example of Infospace, which he founded:
Every business has obstacles. A business that has not gone to the valley of death has never been successful. Every company will tell you that they almost had a near-death experience. And when you come out of it, you’re stronger, better.
Infospace was a great example of this. I started it with my own money, and we had less than one month of payroll left in the bank, and I told every employee, we have one month to turn around; either we make something happen, we find a way to do business, or we’re going to die.
We were trying to build classified services for people to find homes for sale. And my business person comes to me and says, “Hey, there’s a guy, he wants to give us all the home listings for free and we can make all the money we want from it and he didn’t want any piece of it. We should just go out and take it, and we can do advertising and we can make money on it.”
Now, I was stuck on having to make money because we had no money left. I told him, “I want that guy to pay us for it.” And he said, “He’s giving it to us for free, why would he pay us?” And I said, “I want the damn money. Tell him he needs to pay us if he wants his listing there, he needs to pay us.”
My business guy on the phone told him, “My boss wants you to pay. If you want this listing to be taken, he wants you to pay.” And silence. Silence is golden, silence makes people uncomfortable. And the response on the other end was “How much?” Now, I had a business. We were burning $10,000 a month. He said, “Boss says $10,000.” Thought for a second, “Can I pay $5,000 in the first month then second month I’ll pay $10,000, starting second month?” And I said, “We have a deal.”
But my point was when you are near death, you come up with a business model that you would never do if you had lots of money. If you have lots of money, you would never ask the guy how much?
Until then, nobody would pay for the content he provides. But Naveen realized that the home listings were actually advertising, and it saved his company. Infospace became one of the giants of the dot com boom, a $40 billion enterprise.
Second, analyze the cause and then take the appropriate steps.
Cho Tak Wong, the Chinese auto glass giant, explained to me his approach:
If any business starts losing money, then I will admit that we must have made some wrong decisions. However, in order to set it right, I have to correct it right away. But before I do it, I will look for the reason. Is the reason the strategy, or was the reason the execution, or was it an environment change. If the reason was the environment change, then we didn’t do good study, so it was wrong decision; so I will correct it, including stopping it.
Sometimes it’s wiser to give up one limb in order for the whole body to survive. Hüsnü Özyegin recommends to cut the losses in unsuccessful projects:
Make tough decisions. If you think that there is no end in sight to the road you are on, you have to get out. You cannot insist on a business where you’re not successful. Of course, you have to be patient, but if you cannot see the light at the end of the tunnel, you have to cut your losses. It’s difficult, but once you make the decision, you feel better. In Turkish we have a saying, “Cut the arm,” you know? The body doesn’t go away. You have to cut the arm sometimes.
If you think that there is no end in sight to the road you are on, you have to get out.
— Hüsnü Özyegin #BillionDollarGoldNuggets
Cut your losses if you can’t win. Don’t lie to yourself. Take the losses if there is no straight line to profit.
Peter Hargreaves stops a project immediately as soon as he realizes it won’t work, and he has a method to spot it relatively early.
I once started a venture in the firm with a guy, and I told him I would give him two years to make it profitable. What he didn’t know was that if after six months it didn’t look as though it was going to make a profit, I would have closed it down then. Big companies when they give something two years never appraise whether it’s actually likely to be successful and run it for two years when they should have known it wasn’t going to happen within the first year. As soon as you know something isn’t going to work, you should cut it immediately. You know when something isn’t going to work when suddenly you spend an inordinate amount of time discussing it.
Don’t spend more time on things that don’t work than on those that do.
Are you prepared for the long fight against adversity, dear reader? Are you serious about your goals and committed to success? Do you accept “no” as an answer? Do you have the grit and resilience necessary to persevere through the valley of death? Do you know when to hold and when to fold?
- Drifters accept their failure as the final defeat.
- Millionaires don’t give up as easily, but sometimes aren’t persistent enough and often spend more time on things that don’t work than on those that do.
- Billionaires are extremely tenacious but are able to cut the losses immediately when they realize a project won’t work.
For more stories on this topic, go to:
http://TheBillionDollarSecret.com/resources
CHAPTER 13
Do Not Conform
The reasonable man adapts himself to the world, the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.
—George Bernard Shaw
It’s a fallacy that learning all the rules and then proficiently applying them or complying with them will make you rich. Jumping through hoops established by other people might make you the perfect cog in somebody else’s machine, but it is a sure formula for mediocrity and financial failure.
Billionaires choose their own way and stick to their own rules. They do not conform to norms established by others. They don’t follow trends, nor do they follow others. They are the ones who create the trends for others to follow.
Self-made billionaires quite naturally are great individualists. Some describe themselves as loners or “lonely wolves.” You may say, “Well, it’s lonely at the top.” But it is their independent thinking and reliance on their own judgment that brought them to the top in the first place.
Have a Rebellious Spirit
Billionaires’ rebellious spirit and healthy disregard for authority often first materialize during childhood.
Sergey Galitskiy, now the largest food retailer in Russia, recalls: “I can say that I was abused by the life conditions in the
Soviet Union, and I always thought that this is not comfortable for me, and I was always thinking about it.” Once, he skipped the obligatory First May parade and ended up in big trouble at school as a result of it. “In fact, I had a very strong defiant spirit, my school results were not the best. So I was in conflict with the teachers. I didn’t feel that they were authorities. I didn’t see any people that may share with me some intelligent things that can surpass my individuality and make me do what they want.”
For Chip Wilson, a billionaire Canadian sports apparel manufacturer and retailer, defiance became a necessity when he was 12 and struggling with hunger due to a money shortage while his parents were getting divorced. He forged his mother’s signature on a check in order to buy some food for lunch. He realized at this moment that in order to survive he needed to do things for himself and couldn’t rely on anybody else—not even his parents. That independent attitude became his “winning formula,” which led to the founding of several successful businesses.
Manny Stul, the World Entrepreneur of the Year 2016, found school boring and stupid. “Don’t get me wrong; I was good at it. I just wasn’t interested. I was always in trouble.” He was notorious for his cheekiness and for talking back. “I can remember being given the cane across my hands or across the back of my legs in those days.” Once, when he was 16, he disappeared from home for several days. His strong will constantly sparked conflicts with his father, who punished him regularly.
Some billionaires, such as American software billionaire Naveen Jain, demonstrated disdain for the status quo from an early age.
While studying for his MBA in India at a Jesuit school, Naveen disliked that the entire city was under strict alcohol prohibition. Naveen never drank alcohol, but he didn’t like the regulation and decided to stir the pot by having a drink with the dean (whom he referred to as the “warden”). “I decided I’m going to take on this one, this is just not right,” Naveen explains. “They can’t be telling me what to do and what not to do. I should be the one making a decision I don’t want to drink. I don’t want them to be telling me that I can’t drink.”
The result? Naveen was called in to meet with the school principal, Father Megrat, who asked him if he had been drinking. He confessed that he had. The principal informed him that he was going to be expelled for his misbehavior. But the young Jainist (an ancient Indian religion) played the system: “Father, you’re probably right. But I am not Christian. You are. You asked me as Father and I confessed to you, and if you want to use my confession for whatever purpose you want, that’s entirely up to you.”
This caught the principal off guard: “You know I can never use your confession.” “I know that,” Naveen shot back. “Why do you think I told you?”
His deed went unpunished.
Lirio Parisotto wasn’t as lucky when it came to pursuing his career as a priest in a seminary. His strong temperament and behavior didn’t fit the religious standards of the Catholic Church. He was too much of an anarchist, which had a detrimental influence on other students, and was kicked out.
Break Social Norms
Billionaires seek to stand on their own feet and not be dependent on the roles assigned to them by society. They are people who break the norms, break the rules, and break out from the beaten path.
Mohed Altrad, who became the world leader in scaffolding, was born a poor Bedouin in Syria. His tribe was determined to force him to fulfill his destiny as a shepherd. Yet he resisted his fate, starting with attending school even though his grandmother had prohibited it.
Mohed’s family arranged for him to marry a poor Bedouin girl who matched his class, which would have cemented his shepherd status. Mohed went to court to cancel the arrangement, arguing that it was against his will. His tribe wanted to decide everything about his life: whom he should marry, how he had to dress, what he ate, and what he needed to do. He refused to allow others to decide his destiny and broke from his tribe’s practice.
Frank Hasenfratz, a Canadian auto parts manufacturer and another rebellious soul, remarked: “You know, we are oddballs.” Frank grew up in Communist Hungary. While serving as an apprentice in a factory, he once cut out the picture of Hungarian dictator Matyas Rakosi from a dozen newspapers and put the pieces in the factory restrooms as toilet paper. Frank was incarcerated for 30 days; he never confessed, despite being interrogated and abused.
When Frank became interested in rowing, he wished to train with rowers at another factory who were about to go to the Olympic Games. However, all of the training centers were company clubs that restricted play to their own employees. In order to join, he needed to be hired by them. He applied and went to work for the other company. But changing your workplace wasn’t permissible in the communist system, and he was dealt with severely. The regime at the time believed that if one person broke the rules it would jeopardize the factory’s “five-year plan.” His punishment included: being banned for life from continuing his education; a 10% wage cut; and he had to return to working for his previous employer. The wage cut wasn’t as much of a problem as the education ban. Still, Frank managed to complete his education during his time in the army, where he won the support of his colonel, who made it possible for him to study again.
His military service was riddled with instances of insubordination. He was jailed when he called an officer an “idiot.” His failure to follow the rules during a military exercise almost resulted in his shooting down a Soviet plane with a flak.
Even an army jail couldn’t hold Frank back from doing what he considered to be right. When his sister was getting married, he convinced the man in charge, Sergeant Yanush—who happened to be his earlier rowing buddy—to allow him to escape. He even managed to borrow his sergeant’s uniform. If he were to have been caught, it would have meant being charged for two more severe military crimes: desertion and impersonating an officer.
He attended the wedding and everybody was happy. Not only did he keep his family in the dark about his jail stay, he fooled them into believing he was a sergeant.
He was having such a good time he decided to stay in Budapest three days longer than planned.
On his train ride back from Budapest, he was spotted by his captain. “Where have you been?” the captain remarked. “I thought you’re locked up. And you got promoted in jail.” As Frank searched for an answer, the captain said, “Okay, I will talk to you later” before walking away. Apparently, he knew exactly what was going on but generously overlooked it and never mentioned it again, except for an occasional look that said, “I know about you.”
Perhaps the best proof of Frank’s nonconformity was fighting in the Hungarian Uprising on the side of insurgents against the communist Hungarian government and the Russian army.
Break Out of an Unsupportive Environment
Immigrants account for a strikingly high percentage of self-made billionaires on the Forbes List. Many of my interviewees left their countries to escape an unsupportive environment and break out of the roles assigned to them by their initial society before they became the people they were meant to be.
Out of 21 billionaires I have included in this book, five are immigrants:
- Frank Hasenfratz: left Hungary after the Uprising was suppressed by the Russians.
- Frank Stronach: exited impoverished postwar Austria for Canada.
- Naveen Jain: left India to find a better future in the United States.
- Mohed Altrad: was one of the best students in Syria, he became an immigrant to France when he won the right to study there.
- Jack Cowin: left Canada for Australia, where he was convinced he would find business opportunity.
Sometimes—as was the case with Tony Tan Caktiong, Lirio Parisotto, and Manny Stul—it was the children of the emigrants who sought to rise above the level of their struggling parents and to make it big in their country.
It is ingrained in the mind of a self-made billionaire that he will not base his future on anything he cannot control: th
e social background he was born into; the circumstances he has encountered; the role assigned to him by his family; or the social stigma of society.
Be Unemployable
Many billionaires always avoided being employed on a permanent basis; they are always independent, preferring to work on their own account. Due to their untamed natures, billionaires are often useless as regular employees. And those who started out as employees felt an undeniable urge to break free and become sovereign business players.
Lirio Parisotto is a good example here. After 20-year-old Lirio was fired from his job in Brasilia, he was hired at a meat processing company in Nova Bassano as a human resource official. This wasn’t enough for his restless spirit, and he studied to complete his secondary education. At the same time, he transported people in his newly purchased Volkswagen Kombi to the city of Passo Fundo, which was located 100 kilometers away (about 62 miles). A round trip today takes three-and-a-half hours—and it was longer back then.
Lirio usually returned late at night, and, as a result, he was so tired the next day that instead of working he slept in the back room of his friend’s office. Whenever the plant director searched for Lirio, people told him that Lirio was at the plant talking to employees. It took the director two years to discover the truth and fire Lirio.
Lirio subsequently won a competition for a job at Banco de Brazil, which offered him a top salary, a lifetime employment, and a full pension retirement guarantee. It was a dream job that everyone wanted but few could land. He gave it up for the dream of becoming a doctor. He quit the job that so many people dreamed about.
Lirio graduated from the university and became a physician, but even this didn’t work for him; he found himself unable to work at a hospital.
The Billion Dollar Secret Page 19