More tips on start ups; zero to one

Nation building via learning and being the best in business

1.  Visioning

     1  Draw of a picture of what your projects would look like when completed:  entrance, office, landscaping, workspace

         Troy to do this comprehensively   COMPLETO  INCLUSIVE  Be alive be motivated energized by this picture.   You can do a an 

         great one by working with the architect or designer to complete your vision

    2. Draft you VMBP   

    3.  Draw a road map

2.   BE violently  insane  obsessed with customer service  Be like SJ  (Steve Jobs, when it comes to CUSTOMER SERVICE he is passionately fiercely obsessed.

      observing simplicity, efficiency functionality as key features.  Improving customer experience.  Look is important the satisfaction of 5senses.  Want satisfaciton

     CS and COBS

3.  Some billionaire tidbits

     1.  Entrepreneurs go into their own venture to establish control of business and independence

         A  tradesman was working hard and was asked why working so hard/  He said he wanted to earn so much to buy tools so that he can have his own

         contracting company.  

         But the billionaire said:   you are still a working man at the control and service of somebody else:    the general contractor and the owner.

        Why not:   seek contract, consolidate workers and trade and be a general contractor yourself:    you dont need tools  manpower.  All you do is negotiate

         contracts and you get clear profits.     Adds ons % etc.

      2.  On securing funding from vcs and other funders

           They sound so important because of mumbo jumbo but a clear paradigm injected into every ones start up mind.  Input first before business

           You need capital first before you can put business.  What  do you need the capital for:   initial hires, ads, software, office equipment

          But the billionaire said to Arthur who wants a $200,000 start up funding said focus on 3 S:  (YOU MIGHT NOT NEED THE $200, 000)

          SYSTEM

          SERVICE

          SCALE

        So Arthur went home went into a deep reflection problem solving mode.   What does he have, who is market.?  What can he offer them?

        So Arthur concluded that he is skillful  in logistics and there is one logistics problem he is working on.  So he has a list of 300 logistics company whom he

        emailed offering his solution.   One replied.   They had a deal.  If he can solve the company problem by Friday, he gets paid $6,000.  And they did.  Arthur

        got the bank transfer of $6,000.   He spent the $2,500 for someone to code him a program, spent $500 for supplies and saved the $2,000

       So he went into scaling up.  He made videos of his achievement for the first user and sent the gmail again to the rest of 299 addresses  3 replied.  He offered

       $2,000 lease of his software for their solutions.  He got 3 and got contract for $6,000 monthly revenues.  

       After 3 months Arthur was grossing $80,000 a month, enough to gross him $1,000,000 a year

      He met VAnce the billionaire again after 3 months.  Would Arthur still need the VC assistance?   Naw.  You are right with your 3s.  

You dont have to work harder, but smarter to be rich

Nation building via learning and being the best in business

1.  You are the business.  You have your own story, your brand, your grit, your energy.  Show your face

2.  Raise the bar, or burn the bar down  SJ was violent about standards, simplicity  That is why customers love Apple.   What habits are you tolerating low standards?  Be careful of what you tolerate.

3.  From star wars.    Build the parts of your vision before it happens    (Eg Lucas - who built their sets for the galaxy that never exist.  Can you do that for the business you envision)

4.  Conviction beats consensus.     E. g Bernard Arnoux  (LV)  50 year vision

5.  Delete before you improve  (Schumpeterian -  you have to destroy before you build)

     Destroy before you start.   Return to basic principles.  

     A E Del

     Automate

     Eliminate

     Delegate

     A Del2  (Automate,  Delete, Delegate

6.  Energy of start ups build empires  (Alexander the Great)

7.  Draw the dream and build the machine.  Eg. Disney  Land.  Drew the dream and built it.  

     Have you drawn the dream you want to build.   

      

How we wish business success can be via the crystal balls? (or how many gurus, we and pundits have crystals between their thighs)

Nation building via learning and being the best in business

We know how many zillionaires came to being:  by correctly predicting the next big thing:  Bill Gates taht the software si more valuable than hardware in the PC market, Steve Jobs that the next central platform for entertainment:  shows music knowledge would be via mobile phone (not PC or TV as billion dollar investments were poured into this)

There was a knowledge platform Megatrends before (what happened to this) that focussed on changing socio economic trends to predict the next big thing.  Now we have the AI hype but which is now showing mix results.  Others say we will have more leisure time, but most will be out of job.  But even minor tasks being assigned to the AI like writing a business plan, marketing plan is showing a lot of mistakes.

Generals kings before consulted oracles before going into a large batttle.  How we wish there were oracles of Delphi before  making a big bet on new technology or next big thing

Legal loopholes you can use to speed up (not slow down) compounding

Nation building via learning and being the best in business

You can build your wealth through compounding.  That is doubling your money every x years using the rule of 72.  (72 /9  = 8 years to double your money).    That is why higher yields (less risk) make you double your money faster.

Compounding is one of the greatest feature (others say invention) of modern finance.  Others say returns on stock investment is marvelous but there could be bad days/months.    Psei again returned to 6,000+ level.    How many were slaughtered at Phil stock market   My daughter stopped talking about her stock portfolion several years ago

Rule in investing -  DONT LOSE.   Is paramount.

However taxes can take a bite of your returns, Lower the returns and the compounding slows down and takes longer    At todays rate at banks, if in savings this will take  144 years.   At 3% on time deposit (gross)  2.4% net, this will take 30 years.

This video outlines several tips on how to beat the tax bite on returns so that your PHP can compound:

1.  Tax free investments -  There used to be CBCIs  I wonder whether there are still available  There seems to be none

2.  Borrow still die strategy -  Borrow against your stock sleep on it, pay off interest with your dividends.  Dont sell or liquidate.

3.  Hold off selling and pay capital gains when you do.    Those who sell and who are on salary basis pay cgt year after year.

     However for RE in PHL it seems to be a losing battle for real estate flippers.  Its because of the regular increase in Zonal Valuation and having the real property classified as capital goods subject to 12% vat.  No wonder, leases are popular, and flipping is slow, as seen in the 3 years worth of inventory of condos.  No wonder a fmr senator Sec of DOF gets so much hated  Mr. Tax Man.  Mr VAT

    There was this condo offered in Cubao for mere P7 m (market was 12)  But after computing for cgt, interest, and CUSA, the margin  for the  flip in case was merely P500,000 or just a little over 10%

which was minimal.    We could get that return elsewhere.

4.  Depreciation in commercial property.  

    Though there is capital appreciation commercial properties can charge depreciation for 10 20 years  And thus, tax due is lesser and ROI becomes bigger.

5.  Tax free employee plan for retiremen;

     Tax free income for retirement fund, stock options and the like

6.  Index fund -  several transactions gathered togehter as fund, lesser CGT or transaction tax.

7.  Wrappper, corporate veil by placing your investment under a corporation, holding company, or trust, you shiled our personal risk via a corporate veil.   Only the corporation, trust or holding company gets the hit.

8.  Geographicala arbitrage -  Lesser tax bureden abroad, lesser cost of living, lesser cost of investing in the Bahamas, Switzerland,  Cayman islands, lesser cost of livng in Thailand, the PHL, Vietnam

Why Warren Buffett prefers securities over real estate

Nation building via learning and being the best in business

1.  You can do stock transaction in 10-15 minutes and only one deal either buy or sell

2.  Real Estate is more complicated and takes a lot of time   You deal with the owners who could be varying in ideas about the property and one complication lead to another.   It takes time to sell real estate:  you have to find agents, you have to list this, nego for the dp, arrange for the bank financing, and it takes time.   One issue leads to another.  There could be dead owners, unpaid electircity bills, etc.  It is complicated.  It is not a simple business transaction.  It is a lot of head ache

(We have a case of seller suing us for alleged fraudulent docs  They received the full payment. what is there to sue for?)

Only 3 numbers to look at before buying shares/company according to Warren Buffet

Nation building via learning and being the best in business

There may be a lot that analysts other businessmen look for.  Warrent Buffett looks only at 3 measures:

1.  ROI

2.  DE ratio

3.  PE ratio