Scaling to a Million Dollar Business
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I recently read the Millionaire Fastlane by MJ DeMarco, and while I originally thought with a title like that the book was going to be fairly lame and full of get-rich-quick schemes.
That was not the case.
This is a very practical book about creating wealth as a producer -- someone who creates something that fills a need for others.
While this book talks about getting rich quickly, it's a reasonable 'quickly,' in 3, 5 or even 7 years of dedicated work building something useful that positively affects many people either in scale or magnitude.
That last part (scale or magnitude) I really liked. It just seemed to make a lot of sense to me. The idea in the book is that if you want to make a million dollars (or more) you need to positively affect a million people with your business either in scale or magnitude.
What DeMarco means by scale is simply reaching a million people and positively fulfilling a need they have. You have a widget that solves a specific problem and it only costs $1 and you reach and sell that widget to a million people, you're a millionaire (technically).
The idea of magnitude is a bit different. With this idea DeMarco uses the example of real estate. If you own rental properties you can earn significantly more money from renters than the $1 widget from our previous example. With that rent you're providing someone, maybe an entire family, a place to live -- that's a bigger positive impact on others than selling a $1 widget. In both cases a need may be fulfilled, but their is more 'weight' with the real estate example, and that's what DeMarco means by magnitude -- you're selling something that has a bigger impact and thus yields more money per sale.
So if you own 100 rental units that you charge $900 in rent per month, over the course of 12 months you're a millionaire.
Definitely, an interesting read that I would recommend to others.
Posted by Nick Venturella
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