The hardest thing for entrepreneurs isn’t finding success — it’s holding on to it.
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When we start on our entrepreneurial journey, most of us don’t see past the first business. We just see what’s in front of us. That’s not a bad thing. You should be intently focused on making your first venture work.
There’s always the distraction of new technologies, new industries and new tactics to reach consumers. The idea you start your journey with is rarely the same idea you implement when you reach your destination. You see people thriving in areas like AI and blockchain, and it’s easy to want to jump on those trends, too.
But the hardest thing for entrepreneurs isn’t finding success — it’s holding on to it. Consumers change, technology changes, our culture changes. Motorola had a great idea and the hottest phone in 2006 and was then crushed by the iPhone. It happens.
In your entrepreneurial life, you’ll constantly have to adapt. There won’t be years of highs and lows, but months or even weeks of highs and lows. And just like any good stockbroker would tell you, you have to diversify.
What You Should Do With Success
Spreading out your interests, once you’re successful, isn’t a sign of being distracted. It’s smart. You’re never going to be 100 percent successful.
I read last year about a championship boxer, Yahu Blackwell, taking his earnings and investing in everything from Rita’s Italian Ice franchises to technology. Some of my favorite athletes have wasted away their earnings, but in this case the focus was on investing in a future opportunity.
The fact that Yahu was already thinking about diverse ways to create generational wealth in the prime of his fighting career is a reminder that it is never too early to think about your endgame. And you should have an endgame.
Smart, generational wealth has always been built on ownership, whether that’s real estate or venture capital. Entrepreneurs are always chasing money. So once you have it, be smarter with it — and position yourself on the other side of the equation.
Access to money becomes your greatest asset. You don’t have to spend the next 25 years of your career chasing money. It’s hard to get out of that mindset, especially if it got you somewhere. But knowing when to shift mindsets, just like knowing when to shift your business, is what separates good entrepreneurs from great entrepreneurs.
Play Things Safe So You Can Take More Risks
Risk and risk avoidance are more related than you think. Your life portfolio can’t be fully one or the other.
A lot of people want to show off their first success. That impulse is perfectly natural. Whether you’re an entrepreneur, an athlete or an artist, you’ve struggled to succeed. It’s natural, after years of living lean, to want to enjoy that success.
But here’s the thing: Buying depreciating assets like cars, boats, etc., won’t help create long-term wealth. More importantly, they actually distract you from being able to take risks. Your ability to take financial risks or business risks is directly related to how long your runway is — the length of time you can hang on while failing.
It’s a simple relationship: The less money you have tied up, the more risks you can take. But not all assets are the same. Money tied up in a car is money you can’t get back. Money you invest in a property is money you can.
This is a good problem to have. Some of us may never get there, but you should have a plan. The worst place to be as an entrepreneur is in a spot where you don’t have any idea where to go next. Think of it like an emergency exit plan in a hotel: It’s there when you need it, but most of the time, you don’t even have to think about it.