August 03, 2015 Basic Money Management

By: Leonard Kim

I started my journey to entrepreneurship when I was 22. I was a young and arrogant kid who thought that sales was the only skill I needed to succeed, but boy was I wrong. ‎When I launched my first business, I knew nothing and I eventually lost everything because I was too stubborn to take the advice of others and change my habits.

I spent most of my young adult life living lavishly: buying $2,000 suits, going out to the best restaurants, and buying drinks for friends at Hollywood hot spots like Skybar and Les Deux. While I wanted to build a business, I didn't want to change my lifestyle. ‎That ultimately drove me deep into debt. Eventually, I ended up becoming an entrepreneur who struggled financially.

As I grew older, it was hard for me to change my ways. I still wanted nice things and I wanted to go out and have fun. ‎But when I tried to maintain my lifestyle and run a business, I failed. I tried multiple times to achieve a certain level of financial success with various startup companies, but something always went wrong.

We cannot solve our problems with the same thinking we used when we created them.

– Albert Einstein

One day, something in my mind clicked and I came to the realization that I had to do something differently to succeed in business. I pressed pause on my life. I took a year off from trying anything new, and I kept a stable job at a Fortune 100 company. During that time, I reflected back on all the mistakes I made. Then I started to figure out the lessons behind each mistake so I wouldn’t make them again.

Using what I learned from my mistakes, I started to lay out a new foundation and a new set of principles I needed to follow in order to achieve success. Then after another year, I started out in business once again.

How to Increase the Likelihood of Success in Business

Some of you may be out there building a business full-time while others may be working on it on the side. With the economy the way it is, many of us are struggling even if we don’t want to admit it. We have to figure out how to pursue our dreams while still meeting the obligations of taking care of our personal finances and families. With so much responsibility, it can make it quite difficult to secure business finances while still putting food on the table.

At 30 years old, I’ve become more open-minded and humble when it comes to figuring out how to achieve success. This is what I did to regain my footing and to find my place in the business world. By following these tips and pointers, you too will be able to increase your probability of success.

1. Reduce Spending

The first thing I did was to stop buying everything I didn’t absolutely need. The fancy suit? No more. The nice watch? I couldn’t afford to risk buying such a luxury. Going out every night? That needed to stop. While your expenses might look different from mine, it’s still an important step. Review your spending habits and postpone any unnecessary purchases until a time when you’re better able to afford them.

The next thing I did was review my monthly budget. I saw that my electricity bill was high, so I applied for a relief program. When my Internet bill suddenly jumped up to $60 a month, I called and threatened to cancel if they didn’t provide a discount. I went from driving every day to taking public transportation. I went over every single portion of my life and cut out anything that was absolutely unnecessary and negotiated down my bills until my overhead hit $1,600 a month. Go over your finances and cut costs on everything you can. Keep to a strict budget.

2. Utilize Free Resources

Marketing a business can be tough. Sometimes marketing campaigns go well, but more often than not, they can become a money pit. I was bootstrapping my way to success and I needed to maintain a low monthly overhead, so I couldn’t afford to spend any money on resources or tools to help me achieve my success.

So what I did instead was seek out and utilize free resources to leverage my brand. I did this by writing on sites like Quora, Medium, LinkedIn, Twitter, and various other social platforms. By getting active on social media and investing in platforms that invest back into you, you’ll be able to build exposure and connect with others who can help grow your brand.

3. Do Your Best and Create Value

My current business is a personal branding course. To make a course on personal branding, I first needed to build my own personal brand. The only way I could make a solid personal brand was by always doing my best. No matter who I spoke with, what I wrote or what I did, I always put my absolute best effort into everything.

When you put your best effort into what you do, it pays off handsomely. Sometimes, it pays off quickly, but more often than not, the results are slow and steady. Stick with it and put your best into every single thing you do.

You can’t be paid for everything you do with your business. At times, you have to create value instead. I created value by putting all my inside knowledge and experience of my struggles onto paper for the world to see. In return, I built a solid reputation and had thousands of people from across the world messaging me.

Most people are afraid to create value and put it out there into the world because they feel they should be paid for their expertise. Yet, when you’re able to create value in the lives of others, something magical happens. People start to believe in you and your company, they learn to trust you, and they either buy from you or send clients your way.

4. Network

I created an inbound network of business leads when I built up my personal brand, but I also had a second source of income: my job. Most of us can’t survive purely on incoming leads. You’ll have to reach out and network with others to secure more leads as you establish your business.

By creating value, I was able to create a global network of top tiered professionals who are experts in their fields. By networking and adding value to the lives of others, you’ll also attract more customers to your business. 

5. Ask For Help

I knew that building my business would be difficult and I couldn’t do it alone, so I dropped my ego and asked for help. Luckily, there are people who will go out on a limb to help me out with my business. For that, I will always be appreciative. My friend, Harry Tachian, who helped create and franchise many of the major name brand chains that we see today, says that the person who doesn’t ask for help will never make it big. In other words, the person who doesn’t ask for help always stays small.

The person that you ask for help doesn’t have to be a business partner. They don’t even need to benefit from your company in any way. You just have to drop your pride, become humble and reach out to these experts and tell them, “I need your advice” or “I need you to do this for me.” Asking for help is a key component to becoming successful with your small business.

6. Use Savings or a Secondary Income Source

This piece of advice is contingent upon where you are in business and whether you’re single or married. If you’re married with two kids, it can become difficult to maintain a successful business with so many responsibilities. Savings can become exhausted and sales can become slow at any time. It’s always good to find ways to make extra income, such as you or a spouse taking on a steady job to help with the family bills.

If you’re starting a business for the first time, there are two options to choose from. You can either save up at least six months of expenses to live off of and try diving right in; or you can work on your business part time while you work at your job. Personally, I recommend building your business slowly while maintaining your job. Then once your business is able to supersede your current job’s income, you can strike out on your own.

To this day, I’m working on building my business. I’m still cutting costs and asking for help. I’m also still creating value and putting my best foot forward. I hope you decide to follow the same path and reach your success as well. If you ever need any help or advice, don’t hesitate to reach out.

 

Leonard Kim is Managing Partner at InfluenceTree, a personal branding accelerator. He’s a columnist for Inc. and a Top Writer on Quora, an online knowledge market. On the side, Leonard enjoys cupcakes and blogs at LeonardKim.com. Twitter: @MrLeonardKim

 

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